Chinese economic problem: poverty

Introduction

With the development of globalization, the gap between rich and poor has increased. Poverty has been a sustainable economic problem, which would cause a series of problems such as economic distribution, social security, economic fairness, or environmental threats. The poverty’s expansion would also worsen the fairness and social stability. The report would focus on Chinese poverty issue, and would provide the background, deviation, measurements of anti-poverty, challenges and recommendations.

Main Body

Chinese Poverty Issue

In China, according to national calculation agency, there are about 71 million people, which are under poverty line. According to UN’s poverty estimation, the citizens under poverty line has ranked about 10%. According to 2010’s financial assessment, the poverty rate in China has decreased from 10% to 2.8%. Compared with international average poverty rate, Chinese poverty problem has improved rapidly.

According to Engle’s index, when the index is over 60%, poverty problem forms. In 2017, the Chinese Engle’s index has been 29.3% with 0.8%’s decrease, has been coordinated to UN’s average rich range (Anderson, Huang, Ianchovichina, 2004). However, the gap between urban, and rural areas have huge gap.

According to governmental official statistics, there are about 585 towns and districts which are under poverty line. They have dominantly been within Yunnan, Tibat, Guizhou, Henan, Hubei, Shanxi, Gansu, Shanxi, Guangxi, and so on. The average payment has been 625 RMB-865 RMB’s state financial support (Chambers, Wu, Yao, 2008).

Since 1985, China has provided schedules districts which have had average 150 RMB per month. According to global agricultural organization estimation, during 1990-1992, the average population in starvation can be amount to 289 million. Since 1995, Chinese government has launched 110 anti-poverty programs within 260 poor towns, with 20 million people’s direct favor. Since 2007-2009, China has engaged in World Bank and ordered mortgage for urban construction, and environmental governance. According to state council’s estimation, there are about 16 thousand villages have 20%’ poverty rate, and 110 towns have 18%’s poverty rate (Gustafsson, Shi, 2010). It means, in spite of the political governmental control, the poverty problems have still been huge because of the resources’ inequality, and administration drawbacks.

Background of Chinese poverty

There are some reasons for the formation of the poverty in China. It can not be denied that, poverty has been divided into absolute and relevant poverty. The death, diseases, natural living conditions or other factors would all cause poverty in Chinese districts.

2.1 Land and natural resources shortage

With the expansion of population, the land resources have faced with tension. In China, the geographic conditions vary. In the Northwest, or Southwest, the large amount of land has not been exploited, and the local living condition is rather poor, and scattered. While in the Southeast, and Northeast, because of the favorable natural living conditions, the urbanization is advanced, yet the divergence between urban districts and countryside is still huge. At the same time, the natural resources are unfair. In the agricultural industry, the north and south have grown totally different crops. The natural climate, or soil differences would restrict the natural resources utilization, such as water, food, or so forth. In the manufacturing industry, Southeast China has specialized in textile production, while North China has specialized in machinery production. The traditional natural resources for production can not fit for expansion of population. Thus, the survival or living conditions for Chinese people is in low level.

2.2 rural area and isolation

The infrastructure in China has faced with huge gaps. The urbanized districts have high and advanced construction, while the rural or distant districts such as Yunnan, Tibet, have faced with harsh living conditions. The economic state is traditional, and the commercialization is lacked. Local people only have self assisted agricultural industry. But the profitability in local districts are low. At the same time, the traffic condition is problematic, zigzag mountainous range, or unexploited valleys have bothered the development of Chinese residence. The local residence is only under governmental financial aid to survive, while the electricity, or information exposure, education are all lacked. Sometimes, frequent earthquakes, floods, droughts, hurricane or catastrophes would strike local residence or cause epidemic diseases. All these would result in poverty.

2.3 Poor Sanitary or social protection

The poor districts would be out of social protection or social welfare. First, the governmental measurements or public administration would lag behind. The local districts’ population expansion and economic development can not be coordinated, and people do not obey the national development plan, which would cause high birth rate, and population pressure. Second, local people would suffer from poor sanitary or health care protection, the poor natural conditions or chemical pollution, industrial contamination would cause high death rate, or high chronological disease rate. Third, the security management is low. Because of poverty, people have to grab others’ belongings, or trade drugs, or commit crimes, the consequences would be in a series. Without qualified education or enlightenment, people can not think of problems to become rich. The market economy provokes for market competition, the poor districts have to suffer from poverty because of rare market opportunity.

Harmfulness of Chinese poverty

Social disorder

The social classes would be diverted, the social security would face threats because of the extreme poverty. First, people would have low life span, and disease infection. The life quality can be in a low level and the labour resources would be inadequate. Second, people would lack education, and commit crime such as murder, rape, theft, and would go to prison. Some children would lack opportunity or cost to study university, and have to be forced to work at an early age. Third, people would ignore the spiritual civilization awareness and tend to focus on material benefits, so that the social stability would be hindered.

Gap between Rich and Poor

The gap between rich and poor would be huge, and the extreme poverty would cause the social bias towards different races, sub social groups. Specifically, the district differences would cause contempt or misunderstandings, or money worship, or economic conflicts, dishonest business trade, fraud, corruption, program management problem, salary debt abnormal relationship, and so on. For example, the coal mine engineering project would only offer the local workers about 300 RMB/day, sometimes if the project halts at the middle section, the workers would not be paid. Even if the project would cause high risks in death because of explosion of coal mine foundation, the death would has no insurance or rescue. For another example, the Guangzhou Fushikang workers have committed suicide because of 14 hour’s constant work pressure in manufacturing.

4.Measurements in anti-poverty campaign

In order to protect economic sustainable development and go against poverty, the Chinese government, social capital, public financial assistance or other stakeholders have made contributions in Chinese society.

4.1 Chinese Government

Chinese government has launched thousands of programs to help protect anti-poverty phenomenon. First, the government has directly made investment in financial assistance for the local people who are under the bottom line of the salary. It can adjust to the economic redistribution, and stop inflation, or make macro control over market economy. Since 1986, the financial assistance has increased from 1.9 billion to 67 billion RMB for Chinese government (Shek, 2002). Furthermore, Chinese government has ordered complicated taxation system to help with the local economic redistribution. The currency policy and macro control over different industries would be helpful for the redistribution and maintain relevant social fairness.

Second, the government has launched anti-poverty programs, such as house establishment, post catastrophic assistance, industrial commission establishment, local civil servants’ training and spiritual civilization announcement, employment absorbing, social welfare insurance improvement, health care facility administration, and so on. For example, the people under poverty line can be offered with training and job distribution.

Third, it has organized natural engineering programs, such as dam construction, mountainous areas’ construction, habitat transfer, traffic control. The engineering programs can be helpful in natural resources exchange, and economic trade favor enhancement. For example, the gas energy resources from the west China can be transported to the east for economic value addition, while the south China’s water resources can be transported to the north China to coordinate with water shortage (Guanjun, 2017). When the local resources are adjusted in business trade, the gap between rich and poor would be narrowed, and share economics would form.

Fourth, in local poor districts, government has launched tourism construction, and commercialized the natural resources so that the poverty condition can be changed. Fifth, Chinese government has developed second or third industry, and change traditional agricultural farmers into workers, or service makers. About 0.26 billion Chinese labour resources have updated.

Sixth, Chinese government has cooperated with group corporations. The social capital has launched foundation, or donation to help with anti-poverty. According to President, there are 16000 corporations, which can help support 300 people in poverty in one unit (Yao, 2005).

4.2 Public Financial assistance

The world Bank has been helpful to improve Chinese poverty. In 2015, World Bank has permitted 0.15 billion USD financial assistance to China, to reduce the poverty in Sichuan, Guizhou, and Gansu. With these districts, there are about 537 poor towns, they have been organized into centralized agriculture, and endure the technological support in modern agricultural formation (Riskin, 1994).

The market supervision institution has provided market control, and supervision on food security evaluation, commercialization of modern agriculture, agricultural trade market establishment, commercial licenses or certificates application for local traders. Then, the rural areas or residence would become modernized, they can provide products, and earn money in a new way, and would not suffer from poverty any more.

The science institution has involved modern technology such as genetic agriculture, irrigation system establishment, e-commerce platform establishment, tunnel construction, traffic condition can be improved, techniques in operation of manufacturing factories, or fields can be improved. Then, the productivity can be enhanced.

The world Red cross organization or other health care institution would launch free blood assistance to help with life saving. The public volunteering work after geographic catastrophes would help the local residents to provide post rescue work, or habitat construction. The hope project institution or NGOs would offer volunteering education, donation of old clothes to the countryside children. Then, some poor districts’ students can be offered with equal education opportunity.

5.Challenges and recommendations

There are some obstacles, and recommendations for the further improvement of Chinese poverty and poverty gap among different districts.

5.1 Economic bounders

The economic problems must come first. The absolute poverty means local residents have not been under governance. They would contribute to low productivity or consumption stimulus. The Chinese government should order the administration

5.2 Cultural bounders

The cultural bounders mean that people have low education level, or low cultural awareness, or low moral identity, then people would easily commit crime or do not want to be trained to use intelligent resources. Then, the poor condition would not change totally. The measurements can be the devotion of the education or training section.

5.3 Health care threats

The low health care service, medicine treatment would let Chinese people lose themselves in slow psychological suicide. The huge health care charges, facilities, surgery charges, unnecessary health care insurance, lack of compensation, medical accident would let people lose themselves in poverty and death. The measurement should focus on the health care prevention and nutrition service.

5.4 Environmental bounders

The environment pollution would cause problems in land use, natural resources preservation, or exploit of new resources. The measurements can be technological revolution and support for management improvement.

Conclusion

In conclusion, the Chinese poverty gap has made Chinese economic development and Chinese social security hard to balance. The Chinese government has offered many measurements to mitigate the problems. According to the background, Chinese poverty can result from land and natural resources shortage, rural area and isolation, poor sanitary or social protection. The harmfulness can lead to social disorder, and gap between rich and poor. The Government, and other international organizations such as WTO, UN, EU, Red Cross institution, Market Supervision institution, Consumption protection institution have set the above measurements to mitigate problems in poor districts, and stimulate the economic redistribution’s fairness. In spite of the cultural, or environmental threats, the recommendations and further reinforcement on resolution making towards Chinese poverty have also been talked out.