Despite the criticism and doubts, Chinese President Xi Jinping and his administration have stood firmly behind the plan, which Xi staked his legacy on fulfilling in 2017.
Having made remarkable progress toward eradicating poverty over the past seven years, China is reportedly in its final push to achieve a definitive and absolute victory over severe wealth inequality despite the economic impact of COVID-19.
Chinese President Xi Jinping is at the forefront of this push. During an inspection tour in 2018, Xi declared to villagers that “To lead the people to a better life is our goal. Not a single ethnic group, family or person should be left behind.”
However, Xi is hardly China’s first leader to pledge a “war on poverty.”
In 2007, then-President Hu Jintao also vowed to “reverse the growing income disparity” within China. However, a report from the Communist Party-run newspaper China Daily three years later found the income gap to have reached record levels under Hu’s authority. This finding was subsequently echoed by late Premier Wen Jiabao in 2011.
Now, Chinese Premier Li Keqiang has again reiterated these promises in 2014, stating that “China will wage a war against poverty with a stronger resolve.” Li’s push sought primarily to transfer China’s population from rural to urban areas, a move that he hoped would lead to more desirable living standards for China’s rural poor and boost national consumerism.
However, the Chinese government’s approach has received criticism.
In a report by The New York Times, substantial issues were documented with the strategy, including poor construction and few jobs in the feigned urban areas. Concerns over moving small farmers from their land and its effect on China’s food security were also raised.
Furthermore, the report notes that if China’s economic growth continued to slow (as it had begun to in previous years), so too would the fiscal “trickle-down” to individual assets. Should the country’s income growth slow too quickly, domestic consumption would reach a standstill that would in turn endanger China’s economic rebalancing.
As the coronavirus pandemic came into full swing, this is precisely what happened.
In the first recorded reduction in China since before institutions of the Mao-era were removed in the late 1970s, economic data revealed that China’s economy had shrunk 6.8% in the first quarter of 2020, during which around 460,000 Chinese businesses closed.
Some critics even argue that this data is inaccurate and that the true estimates are underrepresented. JP Morgan predicts that by comparison, the US economy will contract by 40% in the second quarter of this year.
“The epidemic and floods in summer have been big challenges, but we are very confident that we can reach the poverty alleviation target this year,” said Hong Tianyun, deputy head of the State Council’s Leading Group Office of Poverty Alleviation and Development. And thus, despite the criticism and doubts, Xi and his administration have stood firmly behind the plan, which Xi staked his legacy on fulfilling in 2017.
The plan to alleviate absolute poverty
In the five years of Xi’s first term, 13 million people were lifted out of poverty each year on average, according to government data. His plan targeted more than 43 million people who lived on fewer than 95 cents a day, the established poverty-level set by the Chinese government. Five years earlier, about 100 million people lived below that line, according to official statistics.
According to the World Bank, nearly 500 million – or about 40% of China’s population – still live on less than US$5.50 per day.
The plan to address this crafted a variety of approaches, including allocating tens of billions of dollars and more than US$370 billion in microloans for villagers. In doing so, Xi instructed officials to focus on alleviating poverty in rural areas where farming conditions are poor, access to essential social services is limited and residents struggle with medical ailments but lack access to a hospital.
Adopting a slightly decentralized approach, around 775,000 officials were sent to villages to implement government measures designed to alleviate poverty. Officials identified each household deemed to be impoverished with a clear sign by their entrance and the name and telephone number of a public servant or staff of a state-owned enterprise paired up to help the household.
Officials are even empowered to resettle villagers against their will, hand out cash subsidies and vigorously follow Xi’s call for a “targeted” approach, with many tracking individual residents’ progress on massive bulletin boards in town centers.
Xi’s administration would then judge these officials on their success in improving living standards to meet President Xi’s 2020 deadline. Throughout this period, more than 1,800 people were investigated last year for embezzling antipoverty funds and related corruption, according to official statistics.
The Chinese Communist Party (CCP) punished nearly 400 government officials for embezzlement or misuse of poverty alleviation funds, all of whom were poverty alleviation authorities at the provincial, city, or county levels. Half of these identified officials were department directors, the Central Commission for Discipline Inspection said.
Critics remain skeptical
Some scholars have responded to the plan by casting doubt on the reliability of the data. In 2019, Xiang Songzuo, an economist and professor at the School of Finance of Renmin University, said that official statistics do not give an accurate picture of China’s economic affluence.
According to Xiang, when he visited these rural areas and spoke with people, the “local government officials are much more frank about the fact that their regions are experiencing negative growth.” Shortly after, his comment was removed from the internet.
Xiang believed some local officials might have understated poverty rates amid intense pressure to meet President Xi’s targets.
However, some critics believe that China falsely reporting data goes further than economics, questioning the integrity of the majority of the country’s data, including, more recently, coronavirus reporting.
According to an analysis by Radio Free Asia, officials may have vastly underreported the official death toll in Wuhan.
So far, the pandemic has resulted in more than thirty-six million confirmed cases and over one million deaths worldwide. The United States has had nearly 7.6 million confirmed cases and over 210,000 of the world’s deaths.
China, where the virus originated, has revealed surprisingly modest statistics. As of September 28, China reported a total of 90,993 infections and 4,746 deaths, figures that some analysts believe to be inaccurate.
Other critics, however, are less concerned about data and more focused on the plan’s specifics, suggesting a lack of consideration for urban areas where many people still struggle to receive adequate education and health care and where many often live in subpar conditions.
The Chinese president’s comment about not leaving “a single ethnic group, family or person … behind” has also resulted in a backlash, with critics citing the active suppression of ethnic groups by the government, most specifically citing the continued construction of concentration camps in Xinjiang, where the Chinese government has reportedly detained at least one million Muslim Uighurs.
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