July 19, 2004

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A tale of two countries

Many people think of China as potentially two countries: the People's Republic on the Mainland and the Republic of China in Taiwan. However there's a far more important split with the Mainland's populace. China's economic boom of the past twenty years has primarily benefited those living in the provinces on China's coast as high as Shanghai and across to Beijing. However the great mass of people living in-land have largely missed out on the benefits of this boom.

Today's Standard carries a report by the Chinese State Council's poverty reduction office saying the number of residents without adequate food and clothing increased by 800,000 last year for the first time in 20 years.

"Since Beijing started transferring money originally allocated for coastal economically developed provinces including Guangdong, Fujian, Zhejiang and Shandong, to relatively poorer western provinces in 1994, six million people were lifted out of extreme poverty every year,'' he said. "However, the number fell to about two million in 2001 and 2002.''

China's extreme poverty levels, defined as those without adequate food and clothing, and earning less than 625 yuan a year, are significantly lower than the international standard of US$1 a day...

"The people lacking adequate food and clothing, mostly farmers, are those earning less than 625 yuan a year while the income in China's rural areas on average is 2,622 yuan. This means the average income of rural people is about 4.12 times the extremely poor figure. But in 1992, the average income of rural people was about 2.45 times the extremely poor figure,'' he said.

"The current gap might widen more when one takes into account social benefits provided in some rural areas.''

Even in China the rich get richer and the poor get poorer. And note that we are not talking about poverty (the US$1 a day mark) but extreme poverty: 625 yuan a year is US$80 a year. China's economic reforms have been a great boon for lifting literally millions out of poverty. However the "trickle down" effect of this wealth has not permiated inland and is not likely to for a variety of reasons. While China has pretentions of being (or at least becoming) a First World economy, when 30 million citizens still exist on less than a US quarter a day, there's more work to be done. All that glitters is not gold.

posted by Simon on 07.19.04 at 09:50 AM in the


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The Two Nations
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Tracked: July 23, 2004 11:52 AM


Very interesting, Simon. Just to put that 625 yuan in a different perspective, Wuxi and Shanghai recently increased minimum monthly wages to 620 and 635 yuan respectively. Without getting into the complexities of wage payments, overtime, workplace conditions, why rural residents move from one place to another, etc, it's clear that the incentive for workers in extreme poverty to take up factory jobs on the coast is pretty high.

It's sometimes useful for people in Australia, the US, and elsewhere in the developed world to think about factory work in China this way: what might you be willing to endure if you could earn in a month what you would earn in an entire year back home?

Obviously it's not a very good analogy, but it's useful to think about the answer. BTW, this is not an argument for poor and dangerous conditions in Chinese factories; it's simply a way of complicating what is sometimes seen in black and white terms.

posted by: Stephen Frost on 07.19.04 at 11:47 AM [permalink]

I have to think that come the Revolution, these inequities are going to be taken care of. Oh, wait, I forgot.

In all seriousness, I think that nothing must scare the Chinese leadership more than the thought of another peasant rebellion.

posted by: RP on 07.19.04 at 09:11 PM [permalink]

Wonderful blog. Simon, should the number be 300 million? Why 30 million? Thanks.


posted by: Anne on 07.20.04 at 02:57 AM [permalink]


Thank you for the comments. The number of 30million sounds right - we're talking about extreme poverty here. The number of people living under the US$1 mark will be significantly higher, although I don't know the exact number. The main point is China is not a uniformly rich country. In fact compared to the USA, for example, where differences in wealth also exist, the differences between regions are massive and a major risk for the CCP leadership.

posted by: Simon on 07.20.04 at 09:27 AM [permalink]

July 9, 2004

Exposé of Peasants' Plight Is Suppressed by China
By JOSEPH KAHN - New York Times

HEFEI, China - In their muckraking best seller about abuses against Chinese peasants, the husband-and-wife authors, Chen Guidi and Wu Chuntao, told the stories of farmers who fought the system and lost.

The book, "An Investigation of China's Peasantry," describes how one farmer's long struggle against illegal taxes ended only when the police beat him to death with a mulberry club. It profiles a village activist who was jailed on a charge of instigating riots after he accused a local Communist Party boss of corruption.

Now, Mr. Chen and Ms. Wu say, it is their turn to be silenced.

Though their tautly written defense of China's 750 million peasants has become a sensation, their names have stopped appearing in the news media. Their publisher was ordered to cease printing at the peak of the book's popularity this spring, leaving the market to pirates who subsequently churned out millions of copies in violation of the copyright.

A ranking official sued sued the authors, accusing them of libel, in his home county court. In a country that does not protect a right to criticize those holding power, it is a case they say they are sure to lose.

Top Beijing leaders acknowledge that China's surging urban economy has done relatively little to benefit the two-thirds of the population living in rural areas. They have put forward new programs to reduce the widening gap between urban and rural living standards.

But the effort to quiet Mr. Chen and Ms. Wu makes it clear that officials will not tolerate writers who portray China's vast peasantry as an underclass or who assign blame for peasants' enduring poverty.

"We spoke up for powerless people, but we ourselves are powerless before these officials," Mr. Chen said in an interview near his home in Anhui Province. "The authorities will not allow peasants to have a voice."

Prime Minister Wen Jiabao has ordered the government to address, in the latest slogan, "three peasant problems": farmers, villages and agriculture. But he and other officials rarely emphasize what many rural experts consider the biggest peasant problems: corruption and abuse of power.

"An Investigation of China's Peasantry" deals with little else. It praises the spirit of central government efforts to reduce the rural tax burden and raise farm incomes. But it shows how such policies are sooner or later undone by local party bosses determined to line their own pockets.

It also details how local officials deceive China's top leaders, including Jiang Zemin, the retired party chief who still leads the military, and Zhu Rongji, the retired prime minister. Even Mr. Wen, whom the authors credit with understanding rural problems better than other leaders, is portrayed as being unable to penetrate the local officials' Potemkin displays of fealty.

Mr. Chen and Ms. Wu shocked many urban readers with their tales of rural backwardness. But they appear to have misjudged how much shock the one-party system would accept.

"We had hoped that there would be some support for our work among central government officials," Mr. Chen said. "But it is really sensitive when you write that the general secretary of the Communist Party does not know what's happening in the country."

Mr. Chen, 61, and Ms. Wu, 41, were both born to peasant families. But they escaped the countryside at an early age and, like many professional writers in China, treated the hinterland as an abstraction. An earlier essay by Ms. Wu, titled "Cherishing a Faraway Place," recalled her rural upbringing and struck a bucolic tone about the simple, honest values of the peasantry.

She said her attitude changed in 2000. That year, when she gave birth to her son, she read that a peasant mother in rural Anhui had bled to death after delivering a child. A hospital had demanded a $360 cash advance to treat her, a sum far beyond her family's means.

Mr. Chen had written environmental tracts and novels about social upheaval. He and Ms. Wu agreed to work together to understand why rural policies had failed.

posted by: Anne on 07.21.04 at 03:46 AM [permalink]

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