15 Jan 300m in poverty in China

Jan 15, 2008
300 million people in China living in poverty
Many peasants in the heartland scrape by on less than US$1 a day

YANGMIAO (HENAN) - WHENEVER she falls ill, Madam Li Enlan, 78, picks herbs from the woods that grow near her home instead of buying modern medicines.
She has never seen a doctor and, like many residents of this area, lives in a meagre barter economy, seldom coming into contact with cash.

'We eat somehow, but it's never enough,' she said. 'At least we're not starving.'

In this region of southern Henan province, in village after village, people are too poor to heat up their homes in the winter and many lack basic comforts such as running water.

Mobile phones, a near ubiquitous symbol of upward mobility throughout much of this country, are seen as an impossible luxury.

People here often begin conversations with a phrase that is still not uncommon in today's China: 'We are poor.'

China has moved more people out of poverty than any other country in recent decades, but the persistence of destitution in places like central Henan province fits in with the findings of a recent World Bank study that suggests that there are still 300 million poor people in China - three times the number that the bank previously estimated.

'Henan has the largest population of any province, approaching 100 million people, and the land there just cannot support those kinds of numbers,' said Mr Albert Keidel, a senior associate at the Carnegie Endowment for International Peace and an expert on Chinese poverty.

'It is supposed to be a breadbasket, but there has always been major discrimination against grain-based areas in China. The profit you can get from a hectare of land from vegetables, or a fish farm or oils, is so much more.'

Other experts say that Henan and other heavily populated parts of the Chinese heartland are often excluded from the financial support that goes to the coastal areas, and anti-poverty measures there are having little effect.

Typically, residents of these areas say, money intended for them is appropriated by corrupt local officials who pocket it or divert it to business investments.

Paradoxically, they say, they are overlooked precisely because of their proximity to the major economic centres of the east. They are forced to fend for themselves on the theory that they can make do with income sent home by migrant labourers and other forms of trickle-down wealth.

'Previous poverty alleviation policy focused more on western China, places like Gansu, Qinghai or Guizhou, which were poorer,' said Mr Wang Xiaolu, deputy director of the National Economic Research Institute, a Beijing non-governmental organisation.

Here in Henan's rural Gushi County, only 73,000 of 1.4 million farmers fall below the official poverty level of US$94 (S$135) a year, which is supposed to be enough to cover basic needs, including maintaining a daily diet of 2,000 calories.

'We should bear in mind that this poverty standard is very low,' Mr Wang said, echoing the view of many Chinese economists.

Many more people in this part of Henan subsist between the official poverty line and the US$1-a-day standard long used by the World Bank.

Last month, the World Bank's estimate of the number of poor people in China was tripled to 300 million from 100 million after a new survey of prices altered the picture of what a US dollar can buy.

The new standard was set according to what economists call purchasing power parity.

Given the huge size of China's population, even a small change in the definition of poverty can produce widely different estimates.

NEW YORK TIMES