China's Poverty Alleviation: Experiences & Strategies

1. Poverty Alleviation performance in China Experiences and lessons XU Lin National Development and Reform commission PRC

2. Phase one: The period before 1978 • Policy orientation: • Catch up strategy under the central planning system • Industrialization oriented to heavy and capital intensified industry • State control of resource allocation • State control on wholesaling and pricing of agricultural products • Rural collective ownership of land • Setting institutional barrier between rural and urban migration

3. Phase one: The period before 1978 • Results: • Relatively high growth rate of GDP averaged at 6.1% each year • Improved living conditions of Chinese people and public welfare provision • Shortage for almost all goods • Low efficiency of the whole economy • The gap between urban and rural • High unemployment • Huge rural poverty population amount to 250 million

4. Phase two: 1978-1984 • Policy orientation: • Institutional reform to create incentives for rural farmers to increase agricultural production (land reform and liberalization of price control) • Liberalization to allow rural labors to move to non- agriculture sector • Encourage development of rural township and village enterprises • Development strategy changes based on comparative advantages

5. Phase two: 1978-1985 • Results: • High growth rate averaged at 8.5%; • Per capita income of the rural residents increased 12.6% each year • Per capita grain production increased by 14% • Rural poverty population decreased from 250 million to 125 million

6. Phase two(1986-1993) • Initiated large scale development oriented poverty alleviation programs • Set up specific poverty alleviation agencies at all levels of government • Allocate specific budget for poverty reduction through development programs • Specific preferential policies for poverty reduction • Results: rural poverty population decreased from 125 million to 80 million

7. Phase three(1994-2000) • A specific national poverty reduction plan was issued by the State Council • Goal: through 7 years to fundamentally resolve the basic living problems of 80 million rural poverty populations • Allocate more resources from whole society to alleviate poverty(119 billion RMB from the central government) • Results: poverty population decreased from 80 million to 3000 million

8. Phase four(2001-2010) • A new poverty reduction plan was issued by the State Council • In 10th five-year period, 158 billion RMB were allocated by central government to poverty reduction • The priorities were given to rural infrastructure, rural labor training, agricultural production facilities, living conditions • Results: rural poverty population decreased from 320 million to 230 million

9. Financial input for poverty reduction

10. Next agenda • Further enhance poverty reduction by all means • Goal :reduce poverty population to 10million by the end of 2010 • Adjust poverty line

11. Experiences be shared • Maintain high and stable economic growth • Market oriented reforming • Right economic policies and strategies • Must be priorities of government • Social participation must be encouraged • Public services must be expanded to rural population • The contribution from International communities both in financial resources and knowledge