From September 21 to 30, 1949, the First Plenum of the Chinese People's Political Consultative Conference (CPPCC) was held in Beijing, with the participation of various political parties, popular organizations, non-Party democrats and representatives from all walks of life. The CPPCC drew up a Common Program, which served as a provisional constitution. It elected a Central People's Government Council, with Mao Zedong as Chairman, and appoint Zhou Enlai Premier of the Government Adminsitration Council and concurrently Minister of Foreign Affairs. On October 1, 1949, a grand ceremony inaugurating the People's Republic of China was witnessed by 300,000 people in Beijing's Tiananmen Square. On that day, Chairman Mao Zedong solemnly proclaimed the formal establishment of the People's Republic of China.

The early days of New China were a period of economic recovery. While developing production, China gradually established socialist public ownership of the means of production. From 1953 to 1956, large-scale socialist transformation of the national economy was implemented, the First Five-Year Plan (1953-1957) for the development of the national economy was achieved ahead of schedule, and China established and expanded basic industries necessary for full industrialization, hitherto non-existent domestically, producing airplanes, automobiles, heavy machinery, precision machinery, power-generating equipment, metallurgical and mining equipment, high-grade alloy steels and non-ferrous metals.