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China Claims It Has Eliminated Poverty But Is That True?

A man walks with an umbrella past a picture of Chinese President Xi Jinping on a street ahead of the National People's Congress (NPC), in Shanghai, March 2, 2021.

Over the past eight years, some 100 million people in rural China have emerged from poverty, a sign of economic progress trumpeted by President Xi Jinping.

Xi launched an initiative after taking power in 2012 that has helped China beat the 2030 target for eliminating extreme poverty set by the World Bank. The People’s Daily, official newspaper of the Chinese Communist Party (CCP), called the elimination of poverty a “historic leap.”

Xi “has stood at the strategic height of building a well-off society in an all-around way,” the newspaper said. The report pointed to the propaganda value to Xi in an economic advance that some suggest may be based, in part, on fudging the numbers.

At a ceremony on Thursday beamed to millions by official media, Xi said China had invested 1.6 trillion yuan, or about $246 billion, in fighting poverty over the past eight years.

“I insisted on looking at real poverty, understanding the real efforts to reduce poverty, helping those who are in real poverty and achieving real poverty alleviation,” Xi said, stressing his personal involvement in the program.

"All 98.99 million people who are the poor rural population have been taken out of poverty,” said Xi, who has amassed more personal power than any leader since Mao Zedong, Communist China’s founder.

Translating the statistics into human terms, Xi said these people no longer need to worry about being able to afford food and clothes — the so-called “two worries” — and that government will also meet its “three guarantees” of health care, housing, and education.

Xi credited the party’s leadership and China’s political system as being “the fundamental guarantees against risks, challenges and difficulties.”

In a “No. 1 policy document” released on Sunday, China vowed to maintain its poverty alleviation policies, while making some adjustments for a five-year transition toward what Beijing calls “rural revitalization.”

The next steps include consolidating and expanding “achievements in poverty alleviation” according to the policy. Experts quoted by China’s official tabloid publication, the Global Times, say a key problem is improving the ability of people in poor rural areas to sustain themselves.

In the past, road building was a government-supported project that provided jobs and future projects could include water projects to improve agriculture processing and transportation, according to the experts.

Giant screen shows CCTV state media broadcast of Chinese President Xi Jinping, at a shopping complex in Beijing, March 2, 2021.
Giant screen shows CCTV state media broadcast of Chinese President Xi Jinping, at a shopping complex in Beijing, March 2, 2021.

Shifting standards

Beijing continues to use World Bank standards for the world’s poorest nations even though it is classified as an upper-middle-class country.

China defines extreme rural poverty as annual per capita income of less than $620, or about $1.69 a day at current exchange rates, according to Reuters.

That compares to the World Bank’s global threshold of $1.90 a day.

“In 2021 … measuring progress using the official poverty lines of the world’s poorest countries as a benchmark may be the very definition of underachievement,” wrote Brookings Institution economist Indermit Gill.

The ceremony “and the associated party propaganda are aimed at painting Xi Jinping as the victorious commander leading China to success in its millennia-long battle against poverty and allowing him to claim personal credit for this accomplishment,” Carl Minzner, a professor at Fordham Law School who specializes in Chinese law and governance, told Bloomberg.

“This will have dramatic ramifications in terms of Xi’s personal power, the extent to which a cult of personality surrounding Xi will be tacitly or directly encouraged,” he said.

Xi and the official media remained largely silent about more than four decades of market-style economic reforms that began with opening China to foreign investment after the Cultural Revolution.

As 2020 closed, Martin Raiser of the World Bank told the New York Times: “We’re pretty sure China’s eradication of absolute poverty in rural areas has been successful—given the resources mobilized, we are less sure it is sustainable or cost effective.”

The government subsidized jobs for rural workers with poverty alleviation projects, gave farmers animals, and pumped money into poor provinces with loans and grants, according to the Times.

This aerial view shows people shopping for groceries at a farmers' market in Jishou, in central China's Hunan province.
This aerial view shows people shopping for groceries at a farmers' market in Jishou, in central China's Hunan province.

Doubts raised

The money flows through China’s Rural Subsistence Allowance System based on an application, its review and approval, and distribution of funds, a process that moves through China’s three basic levels of rural governance — village to township to county.

Rural households apply for subsidies by providing township officials with household registration, disability documents and endorsement from their village governments. The paperwork goes to grassroots level administrative offices such as department of civil affairs.

Township officials review the applications and submit them to county-level government officials for approval.

If approved, an applicant’s money is dispersed on a monthly basis to a designated account in a rural bank or credit union, which does not charge management fees. Each recipient receives an allowance card that works like a debit card, allowing cash withdrawal as needed.

Temporary or one-time living subsidies — such as those granted for holidays — are paid to households in full if all requirements are met.

Huang Xiaomin, a rights activist in Chengdu, Sichuan Province, told VOA Mandarin that, in some places, records used by Xi and other top officials can be inflated.

In Sichuan province, for example, many residents of Heshu town in Peng’an county appear to have received social security and health care benefits. But, the activist said, the reality is different because several people in one family share the money that arrives as a cash payment or bank transfer.

According to Huang, the one-month minimum living allowance for one person is about $42 to $56. When shared among four or five family members of one household, each person got about $11, he said.

“It’s definitely not enough to get out of poverty. But under pressure from the government, [unless the poor people] sign their names to claim everyone has got the full amount, they won’t get any money,” he told VOA’s Mandarin Service “So there’s definitely adulteration."

Maintaining stability

Xi’s messaging Thursday contrasts with a statement by Chinese Premier Li Keqiang last May.

“There are over 600 million people whose monthly income is barely 1,000 yuan (USD $140), not enough to rent a room in Chinese cities,” he said at his annual press conference.

Xia Ming, professor of political science at the City University of New York, said he now expects CCP loyalists to parrot Xi's questionable claims about the success of China's poverty alleviation efforts, and possibly work to generate supporting evidence.

“Because Xi Jinping wants to focus on poverty alleviation as his core work, of course officials at all levels and propaganda departments would desperately try to put feathers in his cap," he said.

Before Thursday's ceremony, several Chinese state news outlets described poverty alleviation as "an epic picture of China's anti-poverty campaign."

Wu Qiang, former lecturer in the political department at Tsinghua University, told VOA that Xi's declaration shows he has nothing else to highlight in his eight years in power. He said declaring the end of poverty is a way to maintain stability in the face of income inequality.

In the past, anti-poverty campaigns in China, such as increased spending on rural schools and health care, sought to close the gap between a visible minority that had profited from economic reform and the majority of people who had not, according to the Associated Press.

“In the market economy, China's rich and poor are divided to an unprecedented extent," said Wu. "...Xi's efforts to alleviate poverty are in fact for political security and the need for stability. Xi's publicity is in fact to show other Party leaders that he has the ability to solve the urgent problems of instability through poverty alleviation and prevent the potential impact on the Party.”

Adrianna Zhang and Jing Zhang of VOA Mandarin contributed to this report.