From The Sick Man of Asia To Economic Miracle: China’s Poverty Alleviation Program

From The Sick Man of Asia To Economic Miracle: China’s Poverty Alleviation Program

In Ningxia, China, 110-year-old Lanqing Shi is sitting in front of a camera, talking to thousands of people online about the famous Goji berry—a healthy food frequently used in traditional Asian cuisines—that her family sells. Many households that plant the Goji berry in Ningxia are able to live a comfortable life. However, it was just 20 years ago that the only way out of poverty in backwards inland provinces like Ningxia was to leave home to do cheap labour work, which is primarily found in advanced industrial cities located eastward. “When I was young, I was on the edge of death because of either cold or famine,” said Shi about her memory of a century of extreme poverty in an interview with Chinese news agency Xinhua Net.

After years of destructive wars and having declared its establishment, China struggled to address its stagnant economy. After opening-up policy reform in 1978, the average monthly salary of a worker in China was only $6.25-$7.81 (RMB 40-50), and 250 million people living in the rural area were in extreme poverty. By 1986, the first major poverty alleviation program was implemented. Since then, the goal to eliminate poverty within China by 2020 was set. 

Reflecting on the 40 years of exploration, it is clear that China uses its unique approach of centralized management, intensive and targeted goals, and strategically adapts to local conditions to transform from an insignificant global economic competitor to the second-largest economy in the world.

China’s poverty alleviation program is centrally planned and organized. These features pose a potential risk of uneven development caused by different resources, cultures, and environments across the country. Therefore, the government is constantly shifting its focus and creating new strategies to cater to the ever-changing socio-economic situation. Initially, the methods adopted to help the poor, such as providing credit funds, work relief, and increasing employment, are straightforward and widely used. After witnessing the exponential growth of the economy in China due to the open-up policy in the late 1980s, the Chinese government realized that the development gap between opened-up and rapidly developing eastern coastal areas and the more closed southern inland area is diverging. In order to address this imbalance, the Chinese government shifted their stress to help those areas with poorer production and living conditions. A list of “poverty counties” was announced, and detailed procedures to get erased from the list were elaborated on in a document, motivating local governments to spend more on poverty alleviation. . 

After experiencing remarkable success from the new policy, the Chinese government started to look for constructive and more well-rounded ideas for growth. The building of democracy, infrastructure, and social capital was introduced. To create a positive image as a responsible member of the international world, the Chinese government took sustainable development into consideration. Access to education, health care, and improved infrastructure in rural areas was guaranteed. Additionally, more environmentally friendly policies were introduced to control pollution, allowing a sufficient supply of clean water to more than 16 million people living in poverty.

Entering 2013, poverty alleviation stepped into a new era. The government increased its efforts in identifying and tracking impoverished households. In rural China, the number of people living under the poverty line has dropped from 98.99 million in 2013 to 43.35 million in 2016, marking the significant success of the targeted poverty relief strategy. 

Another key to the success of China’s poverty alleviation program has been the principle of adaptation to local conditions. Take Ningxia, for example. The sunlight and temperature gifted this area with the outstanding environment of growth for certain agricultural products, such as Shi’s Goji berry. The Goji berry business cannot succeed without the local government’s centralized, intensive, and creative advertisement and related subsidies, technological guidance, and brand raise. Meanwhile, the provincial government also took advantage of its cultural heritage and turned southern Ningxia—where there used to be a base for the Chinese Communist Party during the Long March—into a popular touristic site. In 2018, households living under poverty in this area were reduced from 200 to six, and the poverty rate was reduced to 0.56 percent.

With such steady progress, Chinese President Xi Jinping has announced that China has accomplished the goal of eradicating extreme poverty—ten years ahead of schedule relative to the United Nations’ Sustainable Development Goals. Within the past 40 years, China’s poverty headcount has reduced by 740 million. However, there has been doubts against Xi’s statement from the foreign media. In 2018, the extreme poverty rate in rural China was reported to be around five times higher than in urban areas.  This huge urban-rural gap is not considered in China’s own national poverty line. Taking this into consideration, China’s rural poverty line should be at about 2.30$ a day at 2011 Purchasing Power Parity (PPP) instead of the  official 0.93$. This number is significantly higher than the international extreme poverty line of 1.90$, indicating that the poverty rate of rural China’s is higher than the international standard. 

Despite criticism, China’s substantial achievement of targeted poverty alleviation attracts many foreign policymakers to learn from the country’s experience, thereby increasing China’s ability to influence other countries within its orbit. For example, China’s Belt and Road initiative, which aims to facilitate regional economic cooperation with other countries in the Global South, suggests cooperating with African countries to facilitate sharing China’s knowledge on anti-poverty campaigns. However, it is still unclear if other countries will implement China’s approach, given China’s unique social and political position. Nevertheless, China has shown the world its determination to bring wealth to every part of its territory. 

Edited by Riyana Karim Hajiani

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