China's Approach to Poverty Reduction

发布日期:2018-06-08 13:15:07    来源:北京大学国家发展研究院



On 25 April 2018, Dr. Tan Weiping Deputy Director General, International Poverty Reduction Center in China (IPRCC), talked on China's Approach to Reduce Poverty: Taking Targeted Measures to Lift People out of Poverty with the students of the Institute of South-South Cooperation and Development at Peking University Public Policy Forum International.

Prof. Fu Jun, the Academic Dean of the Institute of South-South Cooperation and Development welcomed the speaker and noted that there are four policy domains, “growth and poverty alleviation, climate change and environment, population and health, and education and innovation”, as fundamental pillars and integral parts of the learning process of the programs. He reminded students that the Sustainable Development Goals (SDGs) have 17 goals with 169 indicators of poverty alleviation as the overarching objective. According to him, China represents one-fifth of the world's population, meaning that it is very important to look at its poverty indicators in spite of its remarkable achievements over the decades.

At the beginning, Dr. Tan Weiping emphasized that the 2030 Agenda for Sustainable Development, with poverty reduction as its primary goal, demonstrates the confidence and determination of the international community in jointly eradicating poverty and achieving common development. As the world’s largest developing country, China has always attached great importance to poverty alleviation and development. He catalogued his presentation into four major contexts:

  • China's poverty reduction achievements
  • China’s proposal for poverty reduction
  • China’s poverty reduction experience
  • How China's approach to poverty reduction benefiting people all over the world

China's poverty reduction achievements

According to the 1.9 dollars poverty line, from 1981 to 2013, China lifted 850 million people out of poverty and the percentage of people living in extreme poverty falling from 88% to 1.85%.

A latest World Bank estimate noted that in 2013, 10.7% of the world's population lived on less than US$1.90 a day as compared to the 12.4% in 2012. According to the report, the number of people living on less than US$1.90 dropped from 1.85 billion in 1990 to 767 million in 2013. When taking into account the movement of people out of extreme poverty since 2013, the number could be a bit lower than this - not so fast as the reduction in the incidence of poverty was mainly driven by East Asia and the Pacific notably China, Indonesia, and India. China alone contributed 70% of poverty reduction across the world and 76% of the achievements made in the global poverty reduction in line with the Millennium Development Goals (2000-2015).

For Sub-Sahara Africa, the case is different as only 4 million people were moved out of extreme poverty while more than 389 million people still living on less than US$1.90 a day as of 2013. It is too sad for a continent endowed with so many natural resources.

In spite of being the second largest economy in the world characterized with sporadic manufacturing, infrastructure development and massive outburst in the area of science and innovation, China is still grappling with the complexities of poverty. The intensity of the fight is manifested in the victory that has been won so far on the poverty reduction frontline. Since 1981, the country has managed to lift more than 850 million people out of extreme poverty with less than 2% of the population currently living in extreme poverty.

China’s proposal for poverty reduction

The country's proposal for poverty alleviation has been a fundamental component of the CPC long-range plan whether it was the Five-Sphere Integrated Plan and the Four-Pronged Comprehensive Strategy embedded in the18th CPC National Congress of 2012. The fight against poverty is both a national and a personal call.

At the national level, the CPC developed proposals for poverty reduction, including:

  • Setting up of clear targets to secure rural residents’ food, clothing, medical care, housing, and compulsory education by 2020;
  • Development of a poverty database to trace the moving in and out of poverty. All the poverty-stricken people should be registered in the database system;
  • Implementation of targeted poverty alleviation strategy via industrial development,  relocation, eco-compensation, education, and social security;
  • Establishment of institutional systems to coordinate and facilitate the fight against poverty in registration system, policy system, investment system, assistance system, social mobilization system, multi-channel, all-around supervision system and assessment system;
  • Accurately support: Send village work teams

China’s poverty reduction experience

Since 2017, employment has been recorded to grow steadily with an average of 13 million new entrants in the labor market whereas growth in urban and rural personal incomes outpaced national economic growth with the middle-income group ever expanding. This remarkable economic growth, according to the Chinese leader, has been a direct result of the role of the state in economic development and poverty alleviation to include the construction of government-subsidized housing projects. The improvement of public health and medical services are all parts and parcel of the strategy to fight poverty.

Another effective comparative advantage that China has in fighting against poverty is its strong use of an online data system that disaggregates the level and ratio of poverty in each province. According to Dr. TAN Weiping, the poverty registry system was able to track 128 thousand villages, 290 thousand households and 90 million poor people in 2014. Alone with this distributional statistic, the CPC and the government on average dispatched 3 officials to stay in each village for two to three years, teaching and training peasants on various methods in the fight against poverty.

However, as it seems, the strategy is not without some hurdles in terms of implementation. One important factor to take note of is the issue of Eco-compensation, a situation in which villages or towns are forced to relocate due to the development and environmental problems. Once an area is recognized as economically valuable for development and that investment will pose an environmental risk, the next best option is the relocation of the indigenes.

The process is not just a flat one. After establishing a suitable location, the next best thing for the government is to provide market opportunities for inhabitants such as the construction of factories. The relocation package also involves short and long-term training programs so that residents can fit into the market structure, as well as a ten years education program to improve adult literacy.  The training process is changed from agriculture to technical and vocational education so that inhabitants can fit into the urban workforce such as manufacturing, waitressing and other urbanized service.

Addressing the social aspects such as culture, religion, weather, and customs are some of the bottom necks in the process and must be carefully looked at in the decision making process. Fortunately, more than 90% of the population belongs to the Han, so religion has not been a major challenge.

Unlike other developing countries that rely on international organizations or friendly nations to assist in formulating policies that address poverty alleviation, China's approach is based on its national conditions, characterized by active explorations and extensive practices. For example, in Africa, the fight against poverty is both an initiative by domestic governments and the development partners.

There are times that it is well coordinated, and at other times, the governments and the donor community carry out the process separately. But such is not the case for China. The fight against poverty has a two-prong approach likewise but with different characteristics. The Chinese model includes the Party's leadership and the Government leadership with both institutions using a consolidated, cohesive, decisive and precise approach in the fight against poverty.

In short, Dr. Weiping noted that China's collective experience in the poverty reduction takes five approaches into consideration: a strategy of targeted poverty, increase financial-investment, generate the support and enthusiasm, buy-in and creativity of the poverty-stricken residents, the mobilization of social forces in the fight and the intensification of assessment and supervision to ensure consistency in the implementation process.

But how does component two (the system of financial investment) work was the question posed to Dr. Weiping. In response, he noted that both the Central and Provincial governments have special funding for the process. The combined budgets for 2017 and 2018 stood at 200 and 300 billion RMB respectively. Funds are disbursed either in the form of agriculture inputs such as machinery, seeds or fertilizers. In addition to the joint funding mechanism, there is also a provision for loans with low or no interest rate at all. In some cases, the government pays the interest rate on behalf of the company wanting to invest in any of the targeted poverty community.

How China's approach to poverty reduction benefiting people all over the world

China's reform and opening-up process were not only limited to its desire to ensure the manifestation of the China Dream but rather to share its experience and resources in assisting other developing countries in their fight against poverty through mutual respect and share prosperity.

During his speech at the Global Poverty Reduction and Development Forum in Beijing China in October 2015, President Xi Jinping called on the international community to boost cooperation to jointly implement the 2030 Agenda for Sustainable Development so as to realize a win-win cooperation. His zeal to eradicate or reduce poverty is not focused on China alone but rather the world as a whole. Towards this end, China over the decade provided around 400 billion yuan in overseas development assistance to developing countries and has sent more than 600,000 aid workers to various countries.

Additionally, the PRC has completed more than 2,700 projects including the construction of hospitals, roads, and other needed infrastructures, and has trained more than 12 million people from more than 60 countries in various professions.

In spite of these poverty reduction strategies through overseas development assistance, there are still some lessons to be learned in the process. One classic example is the fact that some of these developmental projects do not have sustainability framework, that locals are not trained or trained effectively with the technical skills to manage or takeover projects in the event of a problem or after the Chinese experts leave.

Even at the medical levels, some have complained that in spite of building decent hospitals in and around Africa, the Chinese do not provide the necessary training for health workers to take over in the event when they are gone. If these statements are anything to go by, then China needs to firmly rethink its aid architecture to developing countries, as without a sustainability plan, Chinese taxpayers’ money could be wasted over-time.

But as China development plans, especially the fight against poverty is evolving and not carved in stones, the Deputy Director of the International Poverty Reduction Center in China, Dr. Weiping noted that such an issue is worthy of consideration when thinking about aid effectiveness and poverty reduction in developing country.

And like noted earlier on, the fight against poverty is both a national and a personal call. During his speech to the 19th Congress of the CPC, President Xi noted that the wellbeing of the people is the fundamental goal of development, hence the need to do more to improve their lives in the areas of social fairness and justice. Doing so requires an intensified fight against poverty so that Chinese can have a greater sense of fulfillment as they contribute to, and gain from the development of their country.

President Xi himself had his share of working on poverty in the village of Liangjiahe, Shaanxi Province. During his seven years of working with rural peasants at the tender age of 16, the Chinese leader experiences firsthand poverty including extreme hunger which turned some of the villagers into beggars. It was with this deep sense of personal passion intensity and how poverty can threaten the human existence that has given rise to his zeal towards an all fight against poverty.

As the clock tickles toward 2020, the world will be watching with anxiety and great expectations to see whether the world second largest economy will make poverty a thing of the past-the rejuvenation of the Chinese Dream.  (By: Doctoral Candidate: P. Emmanuel Munyeneh