After the announcement of Deng Xiaoping's ‘Open Door Policy’ in 1978, China experienced a gradual transition from a state-owned economy to a socialist market economy. The Four Modernizations project for agriculture, industry, national defence, and science and technology – launched in December of that year – quickly became outdated due to the rapid expansion of transnational capital in the 1980s and economic stagnation around the time of the 1989 Tiananmen Square Incident. The term ‘socialist market economy’ was introduced by Jiang Zemin during the 14th National Congress of the CPC in 1992 to describe the goal of China's economic reforms. The shift from a planned economy to mixed forms of private and public ownership within a market environment represented a new historic breakthrough in the reforms and opening up and created entirely new prospects for China's political, economic, and cultural progress between the 1990s and the 2000s. In November 2012, President Xi Jinping promoted a new slogan, the ‘Chinese Dream’ (Zhongguo Meng: a popular term in the prc describing a personal and national ethos and a set of ideas), to represent his ideals for national development and to uphold the ruling ideology of his new leadership. Xi Jinping's Thought on Socialism with Chinese Characteristics for a New Era was included in the cpc's Constitution during the 19th National Congress in October 2014.

The Chinese Dream is associated with President Xi's goal of the great rejuvenation of the Chinese nation (Callahan 2015a, 2015b, 2017; Ferdinand 2016).