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China's countryside 'returning to poverty': think tank

Nov '19
Pic: Shutterstock
Pic: Shutterstock
Hit by the economic slowdown, the trade war and the widening rural-urban divide, China's countryside is ‘returning to poverty’, says a report by the Beijing Orient Agribusiness Consultant, a think tank linked to the country's agriculture ministry. Rural income has been declining since 2014 and has fallen by 20 per cent in the first half of this year, it said.

"The current situation is not optimistic, the countryside is returning to poverty," a top Hong-Kong-based newspaper quoted Ma Wenfeng, an analyst from the think tank as saying.

Rural China accounts for more than 40 per cent of the country's total population. The report comes in the backdrop of Chinese President Xi Jinping's pledge to eliminate poverty completely by the next year.

China lifted 82.39 million rural residents out of poverty over the six years till 2018, according to a Chinese state-run news agency. Over the past 40 years, more than 700 million Chinese people have cast off poverty, representing over 70 per cent of the world's total during that period, it said.

The welfare of the agricultural economy has become ever more crucial as China's relatively untapped rural consumer market is now seen as a resource to help offset the slowest growth in more than 28 years, clouded by continuing trade tensions with the United States, the Hong Kong newspaper reported.

But the government's good intentions could once again be thwarted by structural obstacles that stand in the way of needed economic reforms. With each year, the gap widens between China's rural villages and its cities, the report said.

According to the government data, rural per capita income excluding the proportion from migrant workers fell to 809 yuan ($114) at the end of June this year, compared with the 1,023 yuan ($145) at the end of 2018.

A major impediment to improving farm income is non-ownership of land tilled by farmers. All land in China is owned by the state and farmers have the right to use it under a renewable 30-year lease. But farmers do not have the right to sell what would be their most important asset and significantly diminishing their financial security, the report said.

The current government policies focus on how to grow and sell more agricultural products but do not directly address farmers' long-term welfare, Ma said.

As such, commercialisation has not addressed structural issues that stand in the way of improving the lives of most Chinese farmers, Ma argued.

Many academics and economists blame China's land policy, which dates back to the early years of the Communist Party rule in the 1950s, as the cause of rural problems.

After redistributing land from rich to poor farmers, the party quickly moved to nationalise farm plots, which have remained government-owned ever since, he said.

Fibre2Fashion News Desk (DS)

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