For much of the past forty years, China was lucky: It was nearly self-sufficient in food, water, and most raw materials. Cheap access to these inputs, plus low labor costs and lax environmental standards, helped make China an industrial powerhouse. Its firms could outcompete foreign manufacturers and dominate industries such as cement and steel. And the fact that China had a relatively pristine environment and untapped resources at just the right moment—the start of the reform and opening period—made the vital difference.
