There are several reasons. China had been witnessing a long time of armed conflict since the late 1920s, a civil war, then the war against Japan , and then the continuation of the civil war. It had not had enough time for economic recovery. After Japan´s surrender in 1945, the war between Nationalists and Communists resumed after having joined forces to face the Japanese occupiers. In the late 1940s, the government of the Chinese Nationalist Party (Kuomintang) of Gen. Chiang Kai-shek was plagued by widespread corruption; there was high inflation and the public administration was seen as ineffective in solving urgent problems. The Nationalists had the support of the USA that provided weapons and money. Besides, the Communists, led by Mao Zedong, had won much prestige for the fight of their guerrillas against the Japanese; they got weapons and supplies from the Soviet Union. Mao employed successful tactics against the superior Kuomintang armies and defeated them, destroying the Nationalist morale. Chiang and the remnants of his army and administration escaped to Taiwan, off the coast of southern China in 1949.
