China’s countryside returning to poverty, finds report

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China’s countryside is “returning to poverty” as it is affected by the economic slowdown, ongoing trade war with America and the widening rural and urban divide, according to a report compiled by a think tank associated with the country’s Agriculture Ministry.

The report by the Beijing Orient Agribusiness Consultant says the rural income has been in decline since 2014 and has fallen by another 20 per cent in the first half of this year.

“The current situation is not optimistic, the countryside is returning to poverty,” warned Ma Wenfeng, an analyst from Beijing Orient Agribusiness Consultant, which includes the Ministry of Agriculture and Rural Affairs as a client, the Hong-Kong based South China Morning Post reported on Sunday.

The report comes in the backdrop of Chinese President Xi Jinping’s pledge to eliminate poverty completely by the next year.

Over the six years till the end of 2018, China lifted 82.39 million rural residents out of poverty, state-run Xinhua news agency reported on Sunday.

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 Post report said.

Rural China, after all, accounts for more than 40 per cent of the country’s total population.

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 (USD 114) at the end of June this year, compared with the 1,023 yuan (USD 145) at the end of 2018.

One major impediment to improving farm income is that farmers do not own the land they till. All land in China is state-owned and farmers have the right to use it under a renewable 30-year lease.

But outright ownership is non-negotiable, meaning 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.

“We [society] look down on the agriculture sector and farmers are seen as in the lowest class in our society. Only when we provide these workers with the same rights – in terms of pensions, education and so on – can the agriculture [sector] problem be resolved,” he said.

The Post report quoted an unnamed farmer in China’s agricultural heartland of central Henan province as saying he could earn about 5,000 yuan (USD 707) per year from the peanuts he harvests on his 10 mu (0.67 hectare) of land, an amount that leaves his family next to nothing after basic expenses. They live in constant fear of falling ill or having to shoulder unexpected costs, he said.

“We don’t have money and when this generation’s young farmers have kids, they won’t be able to afford to pay for [their children’s] education,” Ma, 70, said in a video on Chinese social media.

“Even though North Korea is backward, people there don’t need to pay for education or to see a doctor. But here, can we afford to see a doctor, and pay that 300,000 yuan (USD 42,000)?” he 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.

But analysts said decentralised control and privatising land were unlikely as the party’s rise was built on land reforms, the bedrock of China’s socialist development, according to the Post’s report.

The Economic Times

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