COMBATING POVERTY IN CHINA

One of greatest challenges of the People’s Republic of China, since its founding in 1949, has been poverty reduction. About one percent of the Chinese population lives below the poverty line of $3.20 a day. The figure was around 10 percent in 2000. According to the World Bank, China has had great success in its anti-poverty struggle since Mao’s death in 1976 due to aggressive measures. During the 18th Party Congress in November 2012, Chinese leaders pledged to double per-capita incomes by 2020.

China defines extreme rural poverty as annual per capita income of less than 4,000 yuan ($620), or about $1.70 a day, compared to $1.90 a day the World Bank benchmark. Up until the 2010s, China is defined poverty as having an annual income of below 3,000 yuan (US$450) a year. Li Guoxiang, a rural development researcher at the Chinese Academy of Social Sciences, said large sections of China’s population remain relatively poor even though the Chinese government says they have emerged from poverty. “It seems to be a game of figures, ” Li told the South China Morning Post, adding that there were“more realistic” metrics to measure “whether people have really been withdrawn from poverty”. The researcher defined this as people not having to worry about paying for the basics such as clothing, food, education, medical care and housing. [Source: Mimi Lau,South China Morning Post, November 2, 2017, New York Times, 2020]

Robert Guang Tian and Camilla Hong Wang wrote in the “Worldmark Encyclopedia of National Economies”: The impoverished population dropped from about 250 million in 1978 to 125 million in 1985 because rural areas experienced economic growth. The Chinese government has been planning and organizing a number of large-scale anti-poverty programs all over the country since 1986. By the end of 1992, the poverty population of rural China was reduced to 80 million, reducing the poverty rate to 8.8 percent. [Source:Robert Guang Tian and Camilla Hong Wang, “Worldmark Encyclopedia of National Economies”, Gale Group Inc., 2002]

“In 1994, in order to accelerate the poverty alleviation and ultimately eliminate poverty by the end of last century, the Chinese government launched the "8-7 Plan, " the main point of which was to eliminate absolute poverty in 7 years through the tax favorite policy, financial support, and social-economic development program. For the convenience of implementing the "8-7 Plan, " the central government selected the 592 poorest counties from the more than 2000 counties nationwide and designated them as "national poor counties." It was estimated that more than 70 percent of the 80 million poor concentrated in these 592 counties had very bad natural environments and under-developed social-economic conditions.

“After four years, the poor population of rural China was reduced to 42.1 million, and the poverty rate was 4.6 percent by the end of 1998. The Chinese government spent 24.8 billion yuan (US$3 billion) on poverty alleviation in 1999, 30 times more than in 1980. Rural per capita income among China's 870 million rural residents in 1999 was 2, 210 yuan. Only 3 percent of the rural population remained impoverished or living below the 635-yuan standard, making China's rural poverty rate the lowest among developing nations. In 2000, China announced that it had eliminated "absolute poverty."

“Han Jun, director of the Office of the Central Rural Work Leading Group, wrote: “Between 2013 and 2017, the central government pumped in 278 billion yuan (US$41.4 billion) and provincial governments 182.5 billion (US28.2 billion) to alleviate poverty”. At the end of 2016, more than 43 million people in China were still living below the poverty line, according to Han. “Han said the central government would focus on channelling resources to the worst affected areas, including Tibet, Tibetan autonomous counties in neighbouring provinces, the Liangshan prefecture in Sichuan; southern Xinjiang, Nujiang prefecture in Yunnan and Linxia prefecture in Gansu. +++

Websites and Sources: Wikipedia article on Poverty in China Wikipedia ; Social Issues in China peopledaily.com ; Wikipedia article on Social Issues in China Wikipedia ; Suicide in China Guardian story guardian.co.uk ; China Daily article chinadaily.com ; Center for Disease Control cdc.gov

Decline of Poverty in China

According to World Bank figures the percentage of people living below the international poverty line — which it defines as living on less that US$1.90 a day according to 2011 prices — fell from 6.5 percent in 2012 to 1.9 percent in 2013. the following year. In 1990 66.6 percent of the population fell below this line. [Source: Mimi Lau, South China Morning Post, November 2, 2017]

As of 2005 China was home to two thirds of Asia’s poor. But the numbers were estimated to have fallen 46 million to 416 million —or from 36 percent in 2003 to 32 percent in 2004—according to the World Bank. It has been said that “China helped more people out of poverty than any other country in history.” Since the Deng reforms the number of people living in absolute poverty (unable to adequately feed themselves) has declined from one in four in 1978 to one in twelve today (less than 100 million people). The number of extreme poor has been reduced by 300 million.

Kenneth R. Weiss wrote in the Los Angeles Times, “One of the Communist Party’s primary aims has been to banish hunger and raise living standards, and by many measures the results have been impressive. By reducing the number of dependents per household and freeing more women to enter the workforce, population control efforts have helped lift hundreds of millions of people out of poverty and contributed to China's spectacular economic growth. [Source: Kenneth R. Weiss, Los Angeles Times, July 22, 2012]

Between 1990 and 2009, China slashed its numbers of rural poor from 85 million to 35.97 million, thanks in large part to the wages sent home by migrant workers. The government hopes further urbanization will lift more rural people out of poverty. According to the United Nations, the number of people living on less than $1 a day was reduced from 33 percent worldwide in 1990 to 16 percent in 2000 mainly because of economic growth in China and India.

Much of China’s dramatic decline in absolute poverty occurred in 1980s when the rural poverty rate fell from 76 percent in 1980 to 23 percent in 1985. The poverty rate has changed relatively little since then. The fact that much of the economic growth occurred after that raises the question: how much has market economics really helped the poor?

Development and Economic Reforms in the Poor Areas of China

Development in China has been spotty and uneven. While Beijing and Shanghai have been ranked by the United Nations as equivalent to developed countries in terms of income levels the provinces of Gansu and Guizhou have been ranked with developing countries. Government assistance for the poor includes welfare payments for destitute city dwellers, rural anti-poverty projects and incentives for investments in poor provinces. As a whole the rural poor have been affected very little by the massive amounts of foreign investment that has poured into China.

Micro-credit lending schemes are being used and supported. Nobel-prize winner and Gameen Bank founder Muhammad Yunus is working with the Chinese government to introduce his micro credit system to rural China. The concept of NGOs in China is almost a contradiction of terms. The equivalent of NGOs need to be sponsored by a Communist-controlled umbrella group and registered with the Chinese government, sometimes as companies.

Liu Bolin, China’s Invisible Man artist
Maybe this is what its like being poor and ignored in China Today

Rural people benefited from the Deng reforms the most in the early 1980s when prices for crops were allowed to rise. This one move lifted hundreds of millions out of poverty and is regarded as the biggest anti-poverty measure in history. Under the Deng reforms many peasants moved from mud huts to brick homes and acquired better jobs, health care, food and opportunities than they had in the Mao era. Even though 800 million peasants were the first to benefits from Deng's economic reforms, they have been left behind by the explosive growth in the coastal regions, cities and special economic zones. Incomes for farmers leveled off in 1985 while incomes for urban workers have risen sharply since then. According the World Bank "the quick reductions of poverty through agricultural growth" in China "were largely exhausted by the end of 1984. According to Chinese government statistics 170 million moved out poverty between 1978 and 1985 but only 36 million moved out of poverty between 1985 and 1997.

Number of Poor Counties in China Shrinks

In 2017, the Chinese government removed 28 counties off its list of the poorest places in China — the first time in over 30 years that the list of areas suffering extreme poverty has been reduced Xia Gengsheng, of the State Council Leading Group Office on Poverty Alleviation and Development, said that 28 counties in nine provinces were removed from the extreme poverty list, including Jinggangshan in Jiangxi and Lankao in Henan.[Source: Mimi Lau, South China Morning Post, November 2, 2017]

Mimi Lau wrote in the South China Morning Post: “An initial list of counties suffering extreme poverty in 1986 identified 331 areas. “Despite years of sustained economic growth, this list grew steadily over the years — due to a series of statistical refinements and a greater official focus on tackling the problem — reaching 832 before the latest readjustment.

“According to Yang Lian, the deputy director of the poverty alleviation group’s evaluation division, measures such as developing industry, boosting employment and moving residents away from environmentally challenging areas had helped to lift the population out of poverty in the counties affected. Financial aid has also been provided to ensure the elderly, chronically ill and disabled enjoy a basic standard of living, she said. However, Chinese officials have acknowledged a long and winding road awaits them in combating poverty as it will take a greater effort to lift the remaining 800 or so counties out of poverty. “The remaining counties trapped in poverty are more extreme cases that require more effort as they lack basic infrastructure and social-economic development foundations, Xia told a press conference on Wednesday. “The further we go, the harder it will get.”

Poverty in China is defined having an annual income below 3,000 yuan (US$450) at current prices. “A county can be removed from the extreme poverty list if less than 2 percent of its population is living below the poverty line. In western regions that figure rises to 3 per cent. Stringent criteria are in place to make sure counties seeking to be lifted out of the poor category meet the requirements. This year “another 100 or so counties filed withdrawal applications”, Xia said. To prevent counties from sinking back on to the poverty list, Yang said the central government would continue to pay subsidies until 2020. Chinese officials have said previously that many poor counties are reluctant to have the poverty designation removed because it guarantees subsidies and other help from the central government.

China’s Money-Driven Drive to Erase Extreme Poverty

Reporting from Jieyuan village in Gansu Province, Keith Bradsher wrote in the New York Times: “When the Chinese government offered free cows to farmers in Jieyuan, villagers in the remote mountain community were skeptical. They worried officials would ask them to return the cattle later, along with any calves they managed to raise. But the farmers kept the cows, and the money they brought. Others received small flocks of sheep. Government workers also paved a road into the town, built new houses for the village’s poorest residents and repurposed an old school as a community center. Jia Huanwen, a 58-year-old farmer in the village in Gansu Province, was given a large cow three years ago that produced two healthy calves. He sold the cow in April for $2,900, as much as he earns in two years growing potatoes, wheat and corn on the terraced, yellow clay hillsides nearby. Now he buys vegetables regularly for his family’s table and medicine for an arthritic knee. “It was the best cow I’ve ever had, ” Mr. Jia said. [Source: Keith Bradsher, New York Times, December 31, 2020]

“The village of Jieyuan is one of many successes of President Xi Jinping’s ambitious pledge to eradicate abject rural poverty by the end of 2020. In just five years, China says it has lifted from extreme poverty over 50 million farmers left behind by breakneck economic growth in cities. But the village is also a testament to the considerable cost of the ruling Communist Party’s approach to poverty alleviation. That approach has relied on massive, possibly unsustainable subsidies to create jobs and build better housing.

“Local cadres fanned out to identify impoverished households — defined as living on less than $1.70 a day. They handed out loans, grants and even farm animals to poor villagers. Officials visited residents weekly to check on their progress. “We’re pretty sure China’s eradication of absolute poverty in rural areas has been successful — given the resources mobilized, we are less sure it is sustainable or cost effective, ” said Martin Raiser, the World Bank country director for China.

“Beijing poured almost $700 billion in loans and grants into poverty alleviation over the past five years — about 1 percent of each year’s economic output. That excludes large donations by state-owned enterprises like State Grid, a power transmission giant, which put $120 billion into rural electricity upgrades and assigned more than 7,000 employees to work on poverty alleviation projects.

“The campaign took on new urgency this year as the country faced devastation from the coronavirus pandemic and severe flooding. One by one, provinces announced they had met their goals. In early December 2020, Mr. Xi declared that China had “achieved a significant victory that impresses the world.” “But Mr. Xi acknowledged further efforts were needed to share wealth more widely. A migrant worker in a coastal factory city can earn as much in a month as a Gansu farmer earns in a year. “Mr. Xi also called for officials to make sure that newly created jobs and aid for the poor did not fade away in the coming years.

Problems with China’s Money-Driven Drive to Erase Extreme Poverty

Keith Bradsher wrote in the New York Times: ““While the poverty alleviation program has helped millions of poor people, critics point to the campaign’s rigid definitions. The program assists people classified as extremely poor at some point from 2014 to 2016, without adding others who may have fallen on hard times since then. It also does very little to help poor people in big cities where wages are higher but workers must pay far more for food and rent. [Source: Keith Bradsher, New York Times, December 31, 2020]

“According to the government’s complicated criteria for determining eligibility for aid, anyone who owned a car, had more than $4,600 in assets or had a new or recently rebuilt house was excluded. People hovering just above the government’s poverty line continue to struggle to make ends meet, but are often denied help with housing or other benefits.

“The party’s campaign-style approach also fails to tackle deep-seated problems that disproportionately hurt the poor, including the cost of health care and other gaping holes in China’s emerging social safety net. Villages provide limited health insurance — only 17 percent of the cost of Mr. Jia’s arthritis medicine is covered, for example. Hefty medical bills can ruin families.

“Despite the challenges, the poverty relief program may have a long-term political benefit that helps to ensure some of it survives. Gratitude for the program seems to be reinforcing the political power of the party in rural areas. “In Youfang, Mr. Zhang was quick to praise not just the poverty program but also Mr. Xi, comparing him to Mao. “It is good for the country to have Xi Jinping, ” he said, “and the national policy is good.”

China’s Money-Driven, Poverty-Reduction Drive in Gansu

Gansu is China’s poorest province. Tibet is poorer but its not a province. In November 2020, officials in Gansu said it had lifted its last counties out of poverty. A decade earlier poverty in the province was widespread. Keith Bradsher wrote in the New York Times: ““Hu Jintao, China’s leader before Mr. Xi, visited people living in simple homes with few furnishings. Villagers ate so many potatoes that local officials were embarrassed when a young girl initially refused to eat yet another one with Mr. Hu in front of television cameras because she was tired of them, according to a cable disclosed by WikiLeaks. Though many villages are still reachable only by single-lane roads, they are lined with streetlights powered by solar panels. New industrial-scale pig farms, plant nurseries and small factories have sprung up, creating jobs. Workers are building new houses for farmers. [Source: Keith Bradsher, New York Times, December 31, 2020]

In 2017, Zhang Jinlu woke in terror when the rain-weakened mud brick walls of his home gave way. Half the roof timbers came crashing down with slabs of dirt, narrowly missing him and his mother. Officials in Youfang village built a spacious new concrete house for them, complete with new furniture. Mr. Zhang, 69, now receives a monthly stipend of $82 through the poverty program. His original house was rebuilt for him as a storage shed. “This house used to be dilapidated, and it leaked when it rained, ” Mr. Zhang said.

“The government helps private factories buy equipment and pay salaries if they hire workers deemed impoverished. At Tanyue Tongwei Clothing & Accessories Company in southeastern Gansu, about 170 workers, mostly women, sewed school uniforms, T-shirts, down jackets and face masks. Workers said that several dozen employees received extra payments from the poverty alleviation program in addition to their salaries. Lu Yaming, the company’s legal representative, said Tanyue receives at least $26,000 a year in subsidies from poverty alleviation programs — out of which $500 a year was paid to each of the 17 villagers deemed impoverished. But the viability of these factories without ongoing aid is far from clear. Until the subsidies arrived, the factory frequently had trouble paying wages on time, Mr. Lu said.<

Issues Involving Who Gets Poverty-Reduction Money and How the Money Is Spent

Keith Bradsher wrote in the New York Times: “Inevitable questions swirl over whether some families have used personal ties to local officials to qualify for grants. Corruption investigators punished 99,000 people nationwide in connection with poverty relief efforts last year, according to official statistics. At local eateries in communities like Mayingzhen, where a heavily seasoned platter of fried donkey meat costs $7, the talk is all about who received what, and whether they really should have qualified. [Source: Keith Bradsher, New York Times, December 31, 2020]

“Zhang Sumei, a 53-year-old farmer, earns $1,500 a year growing and selling potatoes and had to use her savings to build her home in concrete. She says that she should have qualified for aid for the extremely poor. Farming Gansu’s notoriously infertile soil is hard and difficult. “In this society, poor families are designated by cadres, and we have nothing.” she said bitterly.

“Yang Xiaoling, a 48-year-old worker who works at another government-subsidized factory in Gansu, wept uncontrollably as she described the crippling debt she faced after paying medical fees for her husband, who suffered kidney failure. Three years ago, she borrowed $7, 700 at zero interest from a bank affiliated with the poverty alleviation program and was supposed to invest the money in buying livestock. But instead she borrowed more money from relatives and then spent all the money on a kidney transplant and medicine for her husband.

“Now the entire loan is due and she has no money to repay it. Follow-up medical treatments for her husband consume her entire salary. So the couple and their three children and her husband’s invalid parents subsist on monthly government poverty assistance payments of less than $50 per person. “I don’t have the ability to pay it back. I can’t help it, ” Ms. Yang sobbed. “I have already borrowed a lot of money, and now no one lends me money.”

NGO Programs to Help Poor Chinese Villagers

Deng Chaochao wrote in Sixth Tone: In 2016, “The NGO I work with, Serve for China, organized a New Year’s product fair across all of our various programs. Villagers would produce goods unique to their region or town, and we would take care of the packaging and marketing. Proceeds from the sale would be divided among the villagers. The local specialties in Mendai [a village in rural Hunan Province] include larou, a kind of cured meat, and baogushao, a spirit derived from corn. Having managed to set up some sales channels in advance, we were relatively confident before production had even begun that we wouldn’t lose any money on the venture. “However, we didn’t want to tell the villagers that it was a surefire way to make a buck, as we worried it would turn the whole activity into just another handout. We decided to give residents two ways to participate in the project. The first was a direct goods-for-cash exchange with the cooperative we set up; the second was to trade their finished goods for shares in the venture, which would pay a dividend based on the project’s outcome.[Source: Deng Chaochao , Sixth Tone, October 9, 2017. Deng is an expert in poverty alleviation at Serve for China, an NGO].

“Every time I visited a home to collect a family’s goods, I always stressed the same point: “There’s a chance we’ll make money and a chance we won’t. If you choose to take shares in the project, then you’ll receive a portion of any profits. But if the venture loses money, then you’ll share in the losses. Ultimately, about two-thirds of the villagers chose to take shares. Goods produced in Mendai eventually brought in more than 100,000 yuan, and those villagers who chose the stock-based option received an average dividend of 1,000 yuan apiece. After Chinese New Year, those who had no shares in the project contacted me and asked whether we would run the same program again this year.

“Although villagers were willing to put their faith in us and share in the risks involved in our project, if we were to leave, this willingness would disappear with us. The most important aspect of our work is helping villagers reach the point where they no longer need outside involvement to motivate them to improve their station. With this in mind, we decided to set our sights on the local youth, whom we hoped we could help start their own businesses.

In March 2017, “we launched the Hiker Project, an initiative designed to help more poor families by providing exceptional young locals with the resources and training they need to start their own businesses. As part of the project, we organized a series of educational workshops, inviting entrepreneurs from industries like farming and manufacturing to come and engage with local youngsters. These businesspeople shared their own stories and tried to ignite their audience’s passion for entrepreneurship. Yayou, the township to which Mendai belongs, is also the source of the area’s water. The flavor of baogushao is in large part derived from the pure water used in its production, and my colleagues and I decided to make this drink the emphasis of our industry development efforts. Bringing together seven youth-operated liquor retailers from across Yayou’s six villages, we established the Baogushao Cooperative.

“Unlike our previous venture, this time we decided to place a villager in charge of the cooperative: Ma Liping, who was just 27 years old. This transfer of power had a marked effect on members, who seemed encouraged by the shift. When I first got here, I thought my job was to help people in the countryside. A year later, my views have changed. My work here isn’t just about helping to compensate for a lack of resources; rather, it is to open up new possibilities — which is far more important. It’s like a line of dominoes, where we act as the first tile. By pushing local residents to work their way out of poverty, we can create chain reactions that help whole communities reach better standards of living.

Guizhou Poverty Alleviation Program Also Combats Global Warming

In 2018, the Chinese government introduced a program that pays low-income households to plant trees. Li You wrote in Sixth Tone: Policymakers are hoping to kill two birds with one stone through a tree-planting program that endeavors to trap carbon emissions and combat poverty. Announced at the 10th Eco Forum Global in provincial capital Guiyang, the voluntary program connects residents of Guizhou province’s low-income villages with individuals and businesses across the country who are willing to pay to offset their own carbon footprint. Villagers plant the trees and pocket the money — expected to reach more than 1,000 yuan ($150) a year per household, in a province where the average annual income for rural residents is only 8, 869 yuan. [Source: Li You, Sixth Tone, July 10, 2018]

“Fu Yeqiu, head of the climate change department under Guizhou’s provincial development and reform commission, explained that she and her colleagues will help villagers record the trees they plant, calculate their carbon sequestration, and upload the information to an online platform. When people buy offsets on the platform, the money is deposited directly into the planter’s bank account. Each tree earns the planter 3 yuan per year for both the initial planting and subsequent care.

“According to Fu, households plant the trees on their own land and commit to protecting the forest. If the trees are damaged by natural disasters, they must report the damage and replant affected trees. Tareq Emtairah, director of the Department of Energy at the United Nations Industrial Development Organization, made the first purchase via the platform at the forum, along with a local Party official. “My suggestion now for the program is to launch an English version so as to have more international participants, ” he told Sixth Tone.

At the end of 2017, 2.8 million people in the province lived below the poverty line, accounting for one-ninth of China’s population living in poverty. Coal mining, hydropower, and tobacco planting and processing are some of the province’s main industries. “Most of the population living in poverty is distributed in the mountain areas, ” Wu Qiang, deputy governor of Guizhou province, said, adding that the area is severely affected by limestone erosion.

“In its bid to protect the environment and reduce poverty, Guizhou has issued policies for reforesting farmland, as well as relocating hundreds of thousands of people living in ecologically vulnerable areas. Yet it’s difficult to break the cycle of desperate people seeking economic development by any means. “In an ecologically vulnerable area, continuous exploitation of natural resources for development leads to ongoing destruction and reliance on these resources, ” Li Xiaoyun, a professor at China Agricultural University, told Sixth Tone. Li stressed that sustainable alternatives need to offer residents real financial incentives. “The income it brings must be much higher than their original income, or they will return to their previous livelihoods, ” Li said.

China’s Anti- Poverty Efforts Hurt by Coronavirus

Javier C. Hernández wrote in the New York Times: “Xu Rudong, a farmer in eastern China, thought he had left poverty behind long ago. He turned a small plot of land into a flourishing field of leeks, selling enough to pay for luxuries like fish and meat for his wife and four children. He even had money left over to buy an electric scooter. “Now Mr. Xu is once again struggling to pay for basic necessities like food and medicine. The economic slowdown caused by the coronavirus pandemic has hurt his income, and severe flooding has devastated his crops. “We are poor, poor people, ” Mr. Xu, 48, said in a recent telephone interview from his home in Wangjiaba, a village of 36,000 in Anhui Province. “We don’t eat meat anymore.”[Source: Javier C. Hernández, New York Times, October 26, 2020]

“Vowing to “leave no one behind, ” Mr. Xi has traveled to hard-hit areas like Wangjiaba to reiterate his commitment. “But the pandemic has exposed the party’s shortcomings in providing its most vulnerable citizens with more than the barest of social safeguards, especially in rural areas. And some experts warn that the government’s response to the crisis — favoring infrastructure spending and tax breaks for companies instead of direct aid for families — may widen China’s gap between rich and poor, which is already among the highest in the world.

“While wealthier workers have largely kept their jobs and assets during the pandemic, millions of people on low incomes are working fewer hours at lower pay, depleting savings and taking out loans to survive. “Our society is not fair, ” said Jike Erge, 27, a construction worker from the southwestern province of Sichuan. “My dream is to be rich, but I don’t know if it can be realized. A stable income and job are impossible.”

“Mr. Jike did not work in the first half of the year because of lockdowns related to the coronavirus. In August, he endured another crisis when severe floods destroyed his home, valued at about $15,000, which he had just finished building. He said he had not received compensation from the government for his losses from the floods, which affected tens of millions of people across China and were the worst in decades. “We work outside for four seasons a year, but we have no savings, ” Mr. Jike said. After the epidemic and the floods, he said, “we couldn’t be poorer.”

“Chinese experts say the strength of the government’s monitoring system will ensure that people stay on a path to prosperity. Local officials, who face the threat of punishment if they do not meet Mr. Xi’s targets, maintain detailed lists of the income levels of poor residents and hand out subsidies, housing and loans to push them above the poverty line. “Any groups of people who are below the standard are put into a file and recorded, ” Li Xiaoyun, a scholar at China Agricultural University in Beijing who is an adviser to the government on poverty programs, said in an interview. “Every village knows.”

Xi Jinping Declares Declares 'Victory' and End of Rural Poverty in China

In February 2021, Chinese President Xi Jinping said that China had achieved "complete victory" in the effort to eradicate rural poverty at a ceremony in Beijing. In December 2020 he said that under his leadership nearly 100 million people were pulled out of poverty, a milestone he as a birthday present to celebrate the 100th anniversary of the ruling Chinese Communist Party (CCP) in 2021. In November 2020, the party announced with little fanfare that China no longer had anyone in extreme poverty. That was down from an official estimate of almost 99 million living on annual incomes of less than 2, 300 yuan ($355) per person in 2010.

Reuters reported: “In an hour-long speech, Xi hailed what he called a testament to the party's leadership and the advantages of China's political system. “The CCP's leadership and China's socialist system are the fundamental guarantees against risks, challenges and difficulties, " Xi said in Beijing's Great Hall of the People. Some global policy experts have said China sets a low bar in its definition of poverty, with sustained investment required to fund continued development in its poorest areas.China defines extreme rural poverty as annual per capita income of less than 4,000 yuan ($620), or about $1.69 a day at current exchange rates. That compares with the World Bank's global threshold of $1.90 a day. Xi said China had invested 1.6 trillion yuan [US$248 billion] in fighting poverty over the past eight years. [Source: Reuters, February 25, 2021]

Eliminating poverty has been a a key aspect of Xi’s ambition of making China a “modern socialist country” by 2050.Joe McDonald of Associated Press wrote: The ruling Communist Party is celebrating the official end of extreme poverty in China with a propaganda campaign that praises President Xi Jinping as a history-making leader who is reclaiming his country’s rightful place as a global power. The propaganda apparatus has been linking national successes to Xi, including fighting the coronavirus, China’s rise as a technology creator and a successful lunar mission to bring back moon rocks. “The full-scale propaganda campaign launched this month has filled state-controlled newspapers and airwaves with reports on the anti-poverty milestone and Xi's personal role in it. [Source: Joe McDonald, Associated Press, February 25, 2021]

“They credit Xi with launching an initiative shortly after taking power in 2012 that enabled China to beat by a decade the 2030 target set by the World Bank for eliminating extreme poverty. A report by the party newspaper People’s Daily this week on the “historic leap” refers to Xi by his full name and title as party leader 121 times. “General Secretary Xi Jinping has stood at the strategic height of building a well-off society in an all-around way and realizing the Chinese dream of the great rejuvenation of the Chinese nation, ” the newspaper said.

Xi Jinping’s Campaign Against Rural Poverty

Rapid economic growth from the 1970s to the 2010s lifted most people in China out of poverty. Under Xi Jinping, the Communist Party vowed to help those who remained at the bottom, focusing his antipoverty drive on people who earn less than 92 cents a day, reducing their number from nearly 56 million in 2015 to around five million in 2020. [Source: Javier C. Hernández, New York Times, October 26, 2020]

“Xi's predecessor, Hu Jintao, and then-Premier Wen Jiabao began the process of improving conditions in rural areas”, Joe McDonald of Associated Press wrote, “ by stepping up spending on rural schools and health care to spread prosperity from the thriving, export-powered east coast. In some areas, low-income ethnic minority communities have been moved out of remote valleys into newly built towns. In others, officials went door to door signing up poor families for job training, grants to start businesses and other aid. “Nearly 10 million people moved into new homes and those of 27 million more have been renovated, according to Xi. He said the government has spent a total of 1.6 trillion yuan ($250 billion). Average income per person among the “rural underprivileged” rose from 2, 982 yuan ($356) in 2015 to 10, 740 yuan ($1, 665) last year, according to the official Xinhua News Agency.

“Some experts suggest China might be less successful than it claims because it is still using standards for the poorest countries long after graduating to middle-income status. The World Bank’s middle-income poverty standard is income of $5.50 per person per day. In a report in January for the Brookings Institution, former World Bank expert Indermit Gill argued China is almost as well off as the United States was in 1960 when it became a high-income country. But Gill said that based on the U.S. income standard from that era, as many as 90 percent of China's people would be considered poor. “If our numbers are correct, China is years — if not decades — behind schedule, ” Gill wrote.

Xi Jinping’s Poverty Alleviation Claims Overstated?

Some analysts called China's poverty eradication claims s a house of cards. Sophia Yan wrote in The Telegraph: While the Chinese government has managed to pull hundreds of millions of people out of poverty in efforts to become a “moderately prosperous” country, scores still struggle to make ends meet. China defines "extreme rural poverty" as an annual per capita income of 4,000 yuan ($620 or less), or roughly $1.70 a day, compared to the World Bank’s global threshold of $1.90 a day. Experts, however, have long said that China should use a more relative poverty line to gauge the economic health of its population. The World Bank estimates about 373 million Chinese are living on less than $5.50 a day, a more comparable poverty line for an upper-middle-income country, like China. Per capita income also remains only about a quarter of that of high-income countries. [Source: Sophia Yan, The Telegraph, February 25, 2021]

“In other words, on paper, China appears to have lifted many out of poverty. But in practice, it hasn’t been enough to broadly improve living standards sufficiently, especially as income inequality remains a major issue, particularly between rural and urban areas. The other concern is whether China’s measures to achieve its target of eradicating poverty will prove sustainable in the long run. Many people have been paid government stipends, increasing their income levels — again, on paper. While government support has been welcomed by some, there are questions on how exactly China will manage to continue to make payments. China’s state pension fund is already slated to run dry by 2035.

“There are also gaps in coverage — one such programme that serves as the primary safety net for some of China’s poorest people covered only 3.1 percent of the population as of mid-2020, with monthly payments as low as around $65 a month, according to the Center for Strategic and International Studies, a think tank in Washington. Local officials determine which households receive payments, making the programme vulnerable to corruption. Critics have also pointed out that cash stipends could disincentivise people from working.

“Rural farmers, relocated from their land to modern housing blocks — a plan meant to improve their livelihoods that has backfired — have told the Telegraph that their only choice is to live off government payments as they aren’t trained for jobs available in urban areas. In some cases, these farmers have even rented out their shiny new apartments — handed out by the government in the name of poverty alleviation — returning secretly to villages and using rental income as a way to survive. So it’s unclear how sustainable China’s poverty alleviation policies will be. In many ways, the government is simply kicking the problem down the road.

Javier C. Hernández wrote in the New York Times: “As with any government initiative with heavy spending, the authorities also routinely report cases of bribery, embezzlement and favoritism in doling out funds, drawing calls for stricter oversight. It is also unclear whether efforts to fight poverty — such as programs to help poor people sell fruits, vegetables and clothing online — will endure after Mr. Xi meets his goal. Mr. Xi faces questions within the party about “the extent to which this poverty elimination campaign is now for real, given the enormous assault that’s happened on disposable income, ” said Kevin Rudd, a former prime minister of Australia who maintains close ties to Chinese officials. He cited the impact of the pandemic and trade tensions with the United States in holding back economic growth. “Many people are wondering, ‘Do I have a job? Has my business gone bust? And how do I feel about my future?’” Mr. Rudd said. [Source: Javier C. Hernández, New York Times, October 26, 2020]

Image Sources: Bucklin archives; Liu Bolin, China’s Invisible Man artist, Global Times Chinese: photo.huanqiu.com ; YouTube

Text Sources: New York Times, Washington Post, Los Angeles Times, Times of London, Lonely Planet Guides, Library of Congress, Chinese government, Compton’s Encyclopedia, The Guardian, National Geographic, Smithsonian magazine, The New Yorker, Time, Newsweek, Reuters, AP, AFP, Wall Street Journal, The Atlantic Monthly, The Economist, Foreign Policy, Wikipedia, BBC, CNN, and various books, websites and other publications.

Last updated October 2021