FOREWORD

This report presents the findings and recommendations from policy studies on the challenges and responses to poverty reduction in China at this important juncture of the country’s development. This joint research was undertaken over the course of the past year and a half, by the United Nations Development Programme (UNDP) and the International Poverty Reduction Centre in China (IPRCC), to inform China’s poverty reduction efforts for the next ten years.

This year marks the beginning of China’s new ten-year poverty reduction strategy and represents the last decade for achieving an all-round Xiaokang society by 2020. The year 2011 also marks the commencement of the 12th Five-Year Plan. And this year also constitutes the beginning of the last 5 years of the Millennium Development Goals. This is clearly a significant juncture for human development, both for China and for the whole world.

Over the past thirty years, UNDP has witnessed China’s outstanding performance in poverty alleviation, achievements which have exceeded even the greatest expectations of China’s many observers. However, as China has developed, her challenges have become more complex, and further poverty reduction will undoubtedly prove more difficult to tackle than in previous years.

One reason for this is that reducing the absolute number of poor people often masks increases in relative poverty. As a result, poverty reduction efforts will need to be redirected towards the substantial number of people that have been left behind. This includes the elderly, children, ethnic minorities, migrant workers, people living in remote areas, etc.

Contemporary poverty in China has also shown signs of some typical “transitional poverty” characteristics, either toward or away from residual poverty largely determined by the suitability of macro-economic frameworks and the quality of institutional governance. It is therefore crucial that these issues be addressed as the contours of China’s development shifts from a largely exported-oriented growth model to one based more on domestic consumption.

To compound the challenge, many of China’s poor live in or around ecologically fragile areas that are highly sensitive to the effects of environmental and climate change. Thus, addressing these vulnerabilities in the context of sustainable livelihoods and equitable growth will require the integration of climate change and poverty reduction strategies with immediate effect.

As the complexity of China’s poverty reduction challenge increases, it is all that much more important that China moves beyond the global obsession with income as the main measure of human progress. Income poverty measures such as per capita income and poverty gap indices are useful but only provide us with part of the picture. What is required is a more sophisticated and multi-dimensional measures to analyze poverty. Only then can we hope to identify the appropriate policy combinations required to adequately address the challenge of reducing poverty and its devastating effects.

In this regard, the present study tackles several important, relevant topics in the formulation of China’s national poverty reduction strategy. Building on the outcomes of intensive consultations between UNDP,

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 1 IPRCC and Chinese State Council’s Leading Group Office of Poverty Reduction and Development (LGOP), and in close collaboration with the Chinese Government and key think tank organizations, a number of policy and programmatic options were explored in the areas of: i) multi-dimensional poverty, planning and targeting; ii) rural governance that ensures more equitable distribution of development outcomes; iii) integrated rural-urban poverty reduction strategies on migration, urbanization and the demographics of an aging population; and iv) climate change, ecosystems and poverty reduction.

UNDP engaged a largely national consultancy team for this analysis, but also involved international poverty reduction experts. An advisory panel, with both senior national and international advisers reviewed the intermediate and final results of this research.

To validate the conclusions and recommendations, UNDP, IPRCC and LGOP organized an international workshop in Beijing on 25 February 2011 with the Government, other UN agencies, academia and NGOs.

In concluding, I would like to take this opportunity to express my sincere appreciation to all the members of the consultancy team and to the IPRCC, for their dedicated efforts and valuable contributions to this most important endeavor. I would also like to express my gratitude to LGOP, and in particular, to Vice Minister Zheng Wenkai, for his invaluable insights and strategic guidance in support of this work.

Renata Lok-Dessallien

Resident Representative United Nations Development Programme in China

Beijing, May 2011

2 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage PREFACE

In the past ten years, the government at all levels has made efforts to ensure smooth implementation of the National Guideline of Rural Poverty Reduction and Development 2001–2010 and achieved remarkable progress. Poverty in China has been dramatically reduced. Progress has also been substantial in terms of human development indicators. The infrastructure in rural areas has been upgraded, while deterioration of ecosystem is being contained. This period also witnessed rapid development of county level economy and improvement of social landscape. It is recognized poverty reduction in many ways continues and in some respects has become more demanding in the next stage. China still has a large number of poor people. Disparity is getting wider. People getting out of poverty are still vulnerable to the risks of returning to poverty. Poverty reduction work in the next stage is undoubtedly more difficult than before.

The study identified the key topics in poverty reduction in the next ten years and proposed a number of policy options based on consensus of UNDP, IPRCC/LGOP, and the findings and policy recommendations in the areas of multi-dimensional poverty measurement and targeting, rural governance and poverty reduction, poverty reduction in the process of urban-rural integration, and climate change poverty reduction were presented in the international workshop, held in Beijing on 25 February 2011 with participants from the Government, other UN agencies, academia and NGOs. These findings and conclusions are of high value to formulation of the national guideline of poverty reduction for the next 10 years. I am very pleased to share the study with more people in the endeavor of poverty reduction.

Zheng Wenkai

Deputy Director Leading Group Office of Poverty Reduction and Development, State Council

Beijing, 1 August 2011

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 3 ACKNOWLEDGEMENTS

This policy study on the Challenges and Response to Poverty Reduction in China’s New Development Stage was made possible by the cooperation and dedication of numerous institutions and individuals.

The United Nations Development Programme (UNDP) and the International Poverty Reduction Centre in China (IPRCC) would like to acknowledge, firstly, the planning, design, analysis and writing of the policy study and reports by a consulting team composed of a working group to produce a chief policy note and sub-section policy notes on key issues and an advisory panel to review the intermediate and final results. The work of all the members of the research team is highly appreciated, for their dedicated efforts and contribution to the report.

The working team comprised the following members: Li Xiaoyun, team leader, Dean and Professor of College of Humanities and Development, China Agricultural University; John Taylor, Professor and Director of Development Research at London South Bank University who is responsible for the references to international experiences and case studies; and Wang Sangui, national consultant responsible for the overall study, Professor at School of Agricultural Economics and Rural Development, Renmin University of China. Within the working team, Wen Tiejun, Dean and Professor at the School of Agricultural Economics & Rural Development, Renmin University of China and his assistants Dr. Yuan Xiaoxian and Dr. Yang Shuai, were responsible for the study on rural governance; Wang Haimin, Professor at the Centre for Integrated Agricultural Development (CIAD) of the China Agricultural University, for the study on multinational poverty and targeting; Lin Wanlong, Professor at the School of Agricultural Economics and Management, China Agricultural University and his assistants, Associate Professor Chen Tianheng and Dr. Qi Gongshen, for the study on rural-urban integration; Qi Gubo, Professor at CIAD of China Agricultural University, for the research on climate change and poverty, and Daniel Wang Dexiang, technical coordinator of the study, Socio-economic Policy Advisor of the UNDP China Poverty Reduction and Social Inclusion Team;.

The advisory panel includes following distinguished members: Wang Pingping, Director, Department of Household Surveys of the National Bureau of Statistics; Pu Yufei, Deputy Director General, Comprehensive Management Department of State Information Center; Prof. Zhao Shukai, Deputy Secretary General of the China Development Research Foundation; Prof. Feng Kaiwen, College of Economics and Management, China Agricultural University; Dr. Dong Zhong, Deputy Director General of the State Council Policy Research Office; Professor Du Yang and Professor Li Zhou, Chinese Academy of Social Sciences; and Professor Lin Erda, China Academy of Agricultural Sciences.

Several international institutions and individuals provided additional assistance during the research and preparation of the report. A number of key advisors from the Asia and the Pacific Region were invited to join UNDP China, IPRCC and the working group in round-table discussions on the research framework, issues and experiences related to the initiative of this policy consultation. They are: Jomo Sundaram, UN Assistant Secretary General from UNDESA; Shantanu Mukherjee, Microeconomic Policy Advisor from the Poverty Group of UNDP Bureau of Development Policy; T Palanivel, Senior Advisor/ Head MDGI; Omar Noman, Chief of Policy and Programmes and Anuradha Rajivan, Practice Leader of Poverty Reduction Unit at the UNDP Regional Centre in Bangkok; Aynul M. Hasan, Section Chief of Development Policy, UNESCAP. Experts from selected countries in the Region were also invited to provide inputs on ideas, experiences and on how some of the key issues Raised in the report are being addressed in their respective countries. They are Dilli Khanal, Chairman of the Institute for Policy Research and Development, Nepal; W.D. Laxman, Senior Advisor, Ministry of Finance and Planning, Sri Lanka; Le Dang Doanh, Research Fellow, Hanoi National University, Vietnam; K. S. Murshid, Author-Bangladesh case study and Economist; and Jayati Ghosh, Professor of Economics at Jawaharlal Nehru University, India, Wan Guanghua, Co-Author of the China Study, ADB.

4 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Invaluable comments and suggestions on the policy findings of this study were received from officials and experts from a number key international/national institutions and academies at the final international workshop co-organized by UNDP, LGOP and IPRCC on 25 February, 2011. They include N.C. Saxena, Vice Minister of Rural Development, India, Dwight H. Perkins, Research Professor of Political Economy of Harvard University, Terry Mckinley, Professor at School of Oriental and African Studies of University of London, Carl Riskin from University of Columbia, Helmut Schwarzer, ILO Senior Social Security Specialist for the America and the Caribbean, Anuradha Rajivan, Practice Leader of Poverty Reduction Unit of the UNDP Regional Centre in Bangkok, Debapriya Bhattacharya, Specialist at the Centre for Policy Dialogue in Bangladesh, Hong Tianyun, Director General of LGOP Department of Policy and Regulation, Ye Xingqing, Inspector of Rural Department of the Research Office of the State Council, Chi Fulin, President of China Institute of Reform and Development (CIRD), Su Ming, Deputy Director of Fiscal Research Institute of Ministry of Finance, Guan Bing, Urban and Rural Household Survey Office of China National Bureau of Statistics, Ding Guowen, Policy Research Office of Communist Party of China, Guo Hongquan, Department of Minimum Living Allowance, Ministry of Civil Affairs, Wu Shulin, Divison Chief from Department of Regional Development, NDRC, Li Shi, Professor at Beijing Normal University, Wu Guobao, Research Fellow of Rural Development Institute of CASS, Leng Min, Research Fellow at Institute of Policy and Management of Chinese Academy of Sciences, Lu Hanwen, Director of Rural Governance and Poverty Reduction Centre of Central China Normal University, Zhang Qi, Professor at Economics and Resources Management Institute of Beijing Normal University, Liu Qi, Director of Anhui Provincial Office of Poverty Reduction, Zhang Zhihao, Deputy Director of Jiangxi Provincial Office of Poverty Reduction and Resettlement and Zhang Jiancheng, Division Chief of Shanxi Provincial Office of Poverty Reduction etc.

LGOP Vice Minister Zheng Wenkai and UNDP Resident Representative Renata Lok-Dessallien, have provided strong support to this study. Subinay Nandy, UNDP Country Director, Napoleon Navarro, UNDP Deputy Country Director, Xu Hui, IPRCC Director, Wu Zhong, IPRCC former Director and Huang Chengwei, IPRCC Deputy Director offered generous guidance, valuable advice and suggestions on the study.

Great thanks are also due to Hou Xinan, UNDP China Assistant Country Director and Wang Xiaolin, Division Chief of Research Division in IPRCC for their management leadership and substantive inputs in coordinating the study, and also to Lu Yibin, UNDP Programme Associate from the UNDP country office and Lu Liqun, Li Xin, Deng Yetao and Xu Liping from IPRCC for their daily support, UNDP interns, Ma Xin and Mathew Lau helped in the layout of the draft report.

Finally and most importantly, we greatly appreciate support from the Poverty Practice, led by Selim Jahan in UNDP’s Bureau for Development Policy and the UNDP Regional Centre for Asia and the Pacific led by Nicholas Rosselini in jointly funding the study. Appreciations also go to the colleagues in these teams, Wang Xiaojun, and Prerna Kapur for all their management support.

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 5 Contents

FOREWORD 1 ACKNOWLEDGEMENTS 4 Overview An Inclusive Poverty Reduction Strategy: Challenges and Recommendations 11 Unprecedented Achievements and New Challenges 11 Urgent Need to Adjust China's Current Poverty Reduction Strategy and Policies 12 The Aim of the Report 12 1. Basic Profiles of China’s poverty 13 1.1 Changes in the Poverty Landscape 13 1.2 China’s Contribution to Global Poverty Reduction 13 1.3 The Poverty Issue is still serious in China 14 2. Future challenges for Chinas Poverty Alleviation Program 14 2.1 Macro level economic and social constraints 14 2.2 Multidimensional Poverty and Poverty Targeting 14 2.3 ‘Transitional Poverty’ in the Process of Urban-Rural Integration 17 2.4 Governance Mechanisms: An Important Factor Influencing the Poverty Issue in the Future 20 2.5 Climate Change and Environmental Deterioration: The Causes of Poverty as Defined by Vulnerability 21 3. Recommendations for China’s Poverty Reduction Strategy to Meet These Challenges 23 3.1 Long-term Poverty Reduction Strategy 23 3.2 Medium-term Poverty Alleviation Strategy 25 3.3 Short-term Poverty Alleviation Policy 27 Chapter One Multi-dimensional Poverty Measurement and Targeting 31 1. Introduction 31 1.1 The concept of multidimensional poverty in China 31 1.2 The connotation of multidimensional poverty 32 1.3 Why multidimensional poverty alleviation policies in China? 32 2. Analytical Framework for Multidimensional Poverty and Tentative Indicators 33 3. Status and Analysis of Multidimensional Poverty in China 38 3.1 Status of multidimensional poverty in China 38 3.2 International research and experiences of multidimensional poverty alleviation 38 3.3 Analysis of China’s multidimensional poverty 39 3.4 China’s strategic direction for poverty alleviation 46 4. Multidimensional Poverty Policies and Implementation Scheme in China 46 4.1 Basis for multidimensional poverty alleviation strategies 46 4.2 Multidimensional poverty alleviation strategies 47 4.3 Implementation scheme for multidimensional poverty alleviation 47

6 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 4.4 Policy recommendations and implementation 50 Appendix One: Understanding of strategies for poverty alleviation in different periods in China 55 Appendix Two: International Experiences and Case Studies 56 Chapter Two Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” 59 1. Rural Disadvantaged Groups: A Key Target of New Poverty Alleviation Initiatives 59 2. Rural Governance: Impacts on Performance of poverty alleviation in the “Post Agri. Tax Era” 65 2.1 Deterioration in rural governance: difficulties in transferring resources of poverty reduction to disadvantaged groups 66 2.2 Low delivery efficiency of PA resources and short-term impact of PA programs 70 2.3 Needy groups into a vicious circle where rural governance deteriorates 71 3. Thoughts on Solving PA Problems and Local Practice 73 3.1 Foster cultural cooperation of the disadvantaged 73 3.2 Introduce external resources for better village governance and mobilizing rural social resources 75 3.3 A comprehensive cooperation framework for self-development capability of the disadvantaged 77 4. Policy Suggestions 81 4.1 Long-term Strategy 81 4.2 Medium-term Policy 82 4.3 Short-term Operations 82 Appendix Three: International Experiences in Rural Governance - Targeting of Poor households and Elite Capture of Poverty 84 Reduction Funds Chapter Three China’s Poverty Reduction Policies During the Process of Urban-Rural Integration 88 1. Introduction: Urban-rural Integration and Transitional Poverty 88 1.1 Vulnerable groups in urban-rural integration process 88 1.2 Transitional poverty and its features 89 1.3 Research framework for investigating and analyzing transitional poverty 90 2. Transitional poverty: issues and challenges 91 2.1 Vulnerable groups in China’s transition period of urban-rural integration 91 2.2 Defects in the current policy system increase the risks of transitional poverty for vulnerable groups 95 3. International experiences and Lessons Learnt 104 3.1 The concepts of social opportunity and social protection must be introduced into poverty prevention policy for vulnerable 104 groups 3.2 A nationwide social safety net will help reduce the impoverishment of populations at risk 105 3.3 The Fragmented social safety net needs to be integrated 106 3.4 Job opportunities and employment loans are important measures for employment security and for preventing mobile 107 population from falling into poverty 4. Structuring a balanced and interlinked urban-rural policy system to deal with transitional poverty in urban-rural integration 108

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 7 4.1 Long-term national strategy: an inclusive urban-rural integration 108 4.2 Addressing transitional poverty as a policy objective and establishing an integrated urban-rural poverty reduction system 110 4.3 Short-term policies and measures: improving current policies and reducing the challenges of transitional poverty 111 Appendix Four: Migration and Transitional Poverty - International Experiences 113 Chapter Four Climate Change and Poverty Reduction Policies 116 1. Vulnerability caused by climate change risks: main causes of poverty 118 2. Poverty alleviation strategies and climate change risks 124 3. Mitigation of climate change, adaptation policies and livelihood vulnerability 129 4. Adaptation to climate change: Reducing livelihood vulnerability 133 5. Adaptation to climate change: Corresponding external assistance 136 6. Foreign experiences: Including climate change risks in PA framework 140 7. Suggestions 145 7.1 Long-term PA strategies: Reducing climate change risks 145 7.2 Medium-term policies and programs: Adaptive policies for climate change in a PA framework 145 7.3 Immediate policies and measures 146 7.4 Fields for potential international cooperation 148 Appendix Five: Climate Change and Poverty Reduction Policies - International Experiences and Case Studies 149 Boxes/Tables contents Boxes Box 1: Macroeconomic Background to Present Impoverishment of Rural Disadvantaged Groups 64 Box 2: Hucun Village Uses Cultural Organization to Increase Participation of the Disadvantaged and Improve Community 75 Governance Box 3: Community Resources Mobilization in the IVDP in Daxu Village of Zhanggong Township, Ningling County of Henan 76 Box 4: Baixin Mutual Aid Fund Cooperative Starting from Joint Purchase and Sale 80 Box 5: Climate risks and other factors have jointly impaired the living of women in a village on Lancang River 122 Box 6: How climate change risks worsen the livelihood vulnerability 123 Box 7: Role of the microfinance in reducing livelihood vulnerability of farmers 125 Box 8: Exclusion of poor population from industrial poverty alleviation 126 Box 9: Facility agriculture to reducing the livelihood vulnerability to climate 126 Box 10: Exclusion on poor population during migration and relocation 128 Box 11: Water conservancy facilities in reducing vulnerability to climate risks 129 Box 12: Ecological protection and opportunity cost of farmers’ living in nature reserves 130 Box 13: Limits of the capacity of mitigating climate risks by a village in the coastal water-land transition areas 137 Tables Table 1. Challenges for China’s Future Rural Poverty Reduction Strategy and Recommendations 30 Table 2. Tentative indicators of multidimensional poverty 36

8 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Table 3. Illustration of Multidimensional poverty by provinces (data: 2009) 49 Table 4. Change of ratios of three types preferential farmer subsidies from the central fiscal budget: 2003-2009 101 Table 5. Investment and effects of the work-relief funds 128 Table 6. The ecological policies or projects related to mitigation of climate change and farmers’ livelihood 131 Table 7. Development activities conducted by the farmer households during sheep breeding in three villages in Yanchi County 138 Figures Fig.1: How Deteriorating Rural Governance Affects Poverty Alleviation in the Post Agricultural Tax Period 21 Fig. 2: The multidimensional poverty space 34 Fig. 3: Analytical model of multidimensional poverty 35 Fig. 4: Changes in Fiscal Deficit and Bank Deposit-Loan Balance in 1980-1995 61 Fig. 5: Changes in China’s Foreign Exchange Reserves in 1978-2004 61 Fig. 6: How Deteriorating Rural Governance Affects Poverty Alleviation in Post Agricultural Tax Era 66 Fig. 7: Research framework 91 Fig. 8: Support from the central finance for issues related to agriculture, farmers and rural areas: 1996-2009 100 Fig. 9: Location of ecotones and poverty stricken counties in China 118 Fig. 10: Percentages of rural poor population in 8 major ecotones between 2001 and 2007 (National Bureau of Statistics of 119 China) Fig. 11: Changes in annual temperature and precipitation in Yanchi Country, Ningxia Hui Autonomous Region, 1954-2007 121 Fig. 12: Relationship of various risks 123 Fig. 13: The alleviation mechanism of external interventions to promote the adaptation to climate change 140 Fig. 14: Framework for adaptation to climate change in Ningxia Hui Autonomous Region 142 Fig. 15: Microinsurance: risk management and social protection mechanism 143

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 9 Acronym and Abbreviation

ADB – Asian Development Bank BPL – Below the Poverty Line CAPA – Capabilities Approach to Project Analysis CCB – Climate, Community, and Bio-diversity CCCPC – Central Committee of the Communist Party of China CCTs – Conditional cash transfers COHD – College of Humanities and Development Studies, China Agricultural University CPC – Communist Party of China CPI – Consumer Price Index DEFRA – Department of Environment, Food, and Rural Affairs, UK DFID – Department for International Development, UK DPIP – District Poverty Initiatives Project GDP – Gross Domestic Product GOWB – Government of West Bengal, India GTZ – Deutsche Gesellschaft für Internationale Zusammenarbeit IFAD – International Fund for Agricultural Development ILO – International Labour Organization IPCC – Intergovernmental Panel on Climate Change IPRCC – International Poverty Reduction Center in China IVDP – Integrated Village Development Project LGOP – Leading Group Office of Poverty Alleviation and Development, State Council MDGs – Millennium Development Goals MoEP – Ministry of Environmental Protection of the People’s Republic of China NBS – National Bureau of Statistics of China NDRC – National Development and Reform Commission, P. R. China NGOs – Non-government Organizations NTRCMCS – New Type of Rural Cooperative Medical Care System PA – Poverty Alleviation PADO – Poverty Alleviation and Development Office RMB – Renminbi (Yuan) STEP – Strategies and Tools against social Exclusion and Poverty UK – The United Kingdoms UN – The United Nations UNDP – United Nations Development Programme WHO – World Health Organization

10 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage An Inclusive Poverty Reduction Strategy: Overview Challenges and Recommendations

Unprecedented Achievements and New Challenges

Since its reform and opening in the late 1970s, China has made unprecedented progress in the area of poverty alleviation. The number of poor, measured in terms of income and welfare parameters, has been reduced significantly. This is one of the most substantial achievements in the field of poverty reduction in Chinese history. Human and social development indicators for both poor areas and the poor population have shown a OVERVIEW noticeable improvement. China has not only contributed significantly to global poverty reduction, but has also provided a basic foundation for the timely fulfillment of crucial UN Millennium Goals.

Although China has made substantial progress in poverty reduction, increasing inequality in income distribution has begun to limit the effects of economic growth on poverty alleviation. In the coming period, China needs to pursue an economic growth which is more inclusive, combining greater equality of opportunity and enhanced social protection An Inclusive Poverty Reduction Strategy: with sustainable growth. Inclusive Development emphasises the importance of economic Challenges and Recommendations growth leading to improvements in both levels of poverty and inequality. In recent years economic growth in China has succeed in reducing poverty, but this growth has been accompanied by increasing levels of inequality, as has occurred in other rapidly growing Asian economies. This has been the case in relation not only to the distribution of income but also in relation to access to health care and educational opportunity, and more generally in relation to access to assets such as land, and markets. Inclusive Development occurs when both average achievements in these areas improve and inequalities are reduced. The importance of achieving a more inclusive development in China is clear: increasing levels of inequality in opportunity potentially can offset the positive effects of growth, as significant groups begin to feel deprived relative to others in relation to areas of human development and access to assets. China currently has a low level of household consumption as a percentage of its gross domestic product (GDP). Relative to other middle and high income countries, China also has an unusually high rate of investment much of which is undertaken directly or indirectly by the Government. The consequences of this GDP structure is that Government’s expenditure fills the gap of inadequate investment of business sector. Government investment creates some employment opportunities, but this investment structure is dependent on resources and is focused on infrastructure development. However, some of this money could also be used to increase levels of social expenditure in areas such as health and social protection, to enable a more balanced development of the economy, shifting government expenditure from resource-dependence investment to social security and income-generation, with a focus on poorer households.

There are many specific challenges for the coming years. On the one hand, China still has about 150 million people below the poverty line of US$1.25 set by the World Bank (WB), which is a considerable number. On the other hand, from the multi-poverty perspective, the issue of poverty has become more complicated. Deficiencies in income, nutrition, health, capacity and rights are not only the result of poverty, but also are an important cause of poverty. A single dimensional poverty alleviation strategy is inadequate for solving these complicated issues.

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 11 Furthermore, in the developing process of social and economic transformation, new vulnerable groups have emerged, and greater attention should be devoted to them. Aging and feminization of the rural population have also led to new challenges for poverty alleviation in rural areas, such as difficulties in developing effective mechanisms for mobilization and organization. In the process of urbanization, increasing numbers of landless peasants and migrant workers have to confront the risks of marginalization, given the absence of an urban-rural integrated social security system and appropriate poverty alleviation polices. These groups could become an important factor threatening social stability. Poverty in China no longer has primarily a rural focus, since it occurs in both rural and urban areas.

Finally, the risk of global climate change has increased, and forms a major threat to poor people living in ecologically vulnerable areas. The adverse impacts of climate change could also lead to reversals in the progress of poverty alleviation. Additionally, the 2008-2009 global economic crisis and subsequent downturn has brought uncertainties into the Chinese economy, and this downturn could still have a longer-term impact on poverty in China.

Urgent Need to Adjust China's Current Poverty Reduction

OVERVIEW Strategy and Policies

Facing new challenges under new circumstances, China needs to adjust its poverty reduction strategy for the next ten years.

Firstly, considering overall trends in urban-rural integration and globalization, China needs to change its current system and policies, which emphasize rural poverty with separation between rural and urban areas, to an inclusive strategy integrating protection and development; it also needs to consider and address the issues of multiplicity and mobility in current poverty occurrence, so that basic livelihoods can be secured and pro- poor policies can benefit the poor population appropriately and timely, no matter where poor people are located. Secondly, it needs to integrate policies formulated by different government divisions into a multi-dimensional poverty reduction strategy framework, so that a “macro level poverty alleviation” mechanism can be created. Thirdly, China needs to refine its priorities in poverty alleviation and improve the accuracy of its targeting

Challenges and Recommendations of poor households. To a large extent, this will depend on institutional arrangements

An Inclusive Poverty Reduction Strategy: for the poor population, in particular on improvements in village governance. Fourthly, China should also develop a risk prevention and mitigation mechanism on the basis of an enhanced understanding of the potential risks caused by climate change, to avoid vulnerable people succumbing to the poverty trap.

The Aim of the Report

This report does not aim to produce a comprehensive analysis of poverty issues in China and the country’s poverty alleviation policies, since there is already substantial important researches addressing these topics. Rather, it focuses on relevant issues that have not been addressed adequately in previous discussions, yet which will have a considerable impact on the future performance of poverty reduction. Additionally, the report provides a number of previews for the Chinese government as it formulates its poverty alleviation strategy for the next decade. Four major issues-multiple poverty, groups of particular relevance in transitional poverty, village governance in developmental poverty alleviation, and climate change and vulnerability-have not been given sufficient attention in research thus far, nor are they reflected adequately in China’s national poverty alleviation strategies. However, these four issues will have a substantial impact on the progress and sustainability of poverty alleviation in the coming years. Consequently, they are the main concern of this report (See the policy framework in Table One).

12 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 1. Basic Profiles of China’s poverty

1.1 Changes in the Poverty Landscape

Remarkable progress has been made in the work of poverty alleviation in China. Based on the US$1 per day PPP definition, the poor population in China has declined from 730 million in 1981 to 106 million in 2005; in other words, the poor population has been reduced by 624 million in less than thirty years. According to the new poverty line of US$ 1.25 per day set by the WB, the poor population has declined from 835 to 208 million in this period, which means that 627 million people have been lifted out of poverty. Based on the line of US$2 per day, poverty has declined from 972 million to 474 million, which means that 498 million people have moved above the poverty line (Chen & Ravallion, 2008a). Therefore, it is safe to claim that in a period of twenty-five years, China has lifted at least 500 million people out of poverty. OVERVIEW

The poverty incidence rate has been reduced even more dramatically, according to relevant data. Based on the line of US$1 per day, poverty incidence has declined from 73.26% in 1981 to 7.95% in 2005, a reduction of 65.31 percent. Based on the line of US$1.25 per day, poverty incidence has declined from 83.8% to 15.6%, equal to a reduction of 68.2 percent. Based on the line of US$2 per day, poverty incidence has declined from 97.8% to 35.7%, equivalent to a reduction of 62.1 percent. An Inclusive Poverty Reduction Strategy: China has also made remarkable progress in social and human development. The Challenges and Recommendations Human Development Indicator (HDI) for China has risen from 0.533 in 1980 to 0.772 in 2007, with an increase of 45 percent (UNDP 2009). From 1978 to 2007, the primary school enrollment rate increased from 94% to 99.5%, and the junior middle school enrollment rate increased from 87.7% to 99.9%. By the end of 2007, national coverage of nine-year compulsory education stood at 99.3%. Both boys’ and girls’ primary school enrolment rate rose to above 99.5% with little gender difference. The mortality rate for children under five years-old declined from 64‰ in 1980 to 18.1‰ in 2007; the infant mortality rate declined from 50.2‰ in 1991 to 15.3‰ in 2007; and the maternal mortality rate declined from 9.5 per ten thousand in 1990 to 3.7 per ten thousand in 2007. The under-weight rate for children under five years-old declined from 19.1% in 1990 to 6.9% in 2005; the growth retardation rate for children under five years-old declined from 33.4% in 1990 to 9.4% in 2005. The rate of safe water accessibility increased from 67% in 1990 to 88% in 2006 (Ministry of Foreign Affairs, UN China agencies, 2008).

1.2 China’s Contribution to Global Poverty Reduction

China has made a substantial contribution to poverty alleviation globally. Based on the line of US$1.25 per day, the global poor population has declined from 1.896 billion in 1981 to 1.377 billion in 2005, which is equivalent to a 519 million reduction in the absolute poor population. The poverty incidence rate has declined from 51.8% to 25.2%, equivalent to 26.6 percent. In the same period, excluding China, the poor population in the rest of the world has increased from 1.061 billion to 1.169 billion, equivalent to 108 million in absolute terms. The rate of poverty incidence has declined from 39.8% to 28.2%, equivalent only to 11.6 percent. Based on the US$2 per day line, in areas other than China, the poor population has increased by 525 million (Chen & Ravallion, 2008b). These figures show that progress in poverty alleviation at the global level has been to a significant extent due to the substantial poverty reduction achieved in China.

China has already achieved four of the main UN Millennium Development Goals, namely, to halve the population below the poverty line of US$1 per day, to halve the population living in conditions of food scarcity, to ensure that all children can complete junior

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 13 education, and to reduce by two thirds the mortality rate for children under five years; Other goals are likely to be completed before 2015 (Ministry of Foreign Affairs, UN China agencies, 2008). China’s achievements in poverty reduction and its overall development are thus making a substantial contribution to the success of the UN in achieving its Millennium Development Goals.

1.3 The Poverty Issue is still serious in China

China is now classified as a middle income country. In 2008, its average GDP per capita, based on current prices, reached US$3,267; average national income per capita is US$2,940, and national income per capita is US$6,010, based on PPP. The majority of middle income countries adopt a poverty line above US$2. Based on this poverty line of US$2, China has a poor population of 474 million people, which means that one third of the total population is living on less than US$2 per day. In the 92 countries with supporting quantitative data, the poverty incidence rate in China is higher than that of 51 counties and is close to that of Honduras, Nicaragua and Kenya, yet relatively lower in some social and human development indicators.

2. Future challenges for Chinas Poverty Alleviation OVERVIEW Program

There are a number of new problems and challenges that China will have to face in the next ten years to achieve its goal of large scale poverty alleviation. Poverty will become more multidimensional; new transitional poverty is emerging in the process of urban- rural integration, and this will become more prevalent; economic transformation and urbanization will lead to large scale migration, weakening rural human and material resources, and this will in return adversely affect village governance and the performance of rural developmental poverty alleviation programs. Additionally, climate change will trigger more natural disasters in ecologically vulnerable areas, which in turn will result in households falling back into poverty.

2.1 Macro level economic and social constraints

Future poverty reduction performance in China will also depend on macro-economic

Challenges and Recommendations and social conditions. On the one hand, China’s economy is encountering the “middle An Inclusive Poverty Reduction Strategy: level income trap”. The global market which has been one of the major driving forces for China’s economic growth may stagnate due to the financial crisis. This situation is forcing China to adjust its economic structure more towards internal demand. Yet consumption remains limited within the rural population. Furthermore, increasing labor costs may reduce the competitiveness of China’s industrial goods in the global market. On the other hand, with an aging population and an increased need for social protection programs, government expenditure on these items is likely to increase, affecting the capacity of the state to invest in other areas of the economy.

2.2 Multidimensional Poverty and Poverty Targeting

Although poverty incidence measured by income and consumption is declining, viewed from a multidimensional poverty perspective, poverty remains a serious issue for China, particularly according to non-economic indicators. Conventional understanding often takes for granted that low income is the main cause of poverty; however, poverty almost always has more complex causes.

Recently there have been important developments internationally in the measurement of multidimensional poverty. This is being done via the use of a “Multidimensional Poverty Index” (MPI) with three dimensions–health, education and living standards,

14 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage measured through ten indicators. These indicators are based on available data and participatory assessments. The MPI defines a household as multi-dimensionally poor if it is deprived in a combination of indicators whose sum exceeds 30% of all deprivations. Using the MPI, China currently has 7% of its population living in poverty (Compared, for example, with India at 55%, Pakistan 51%, Indonesia 21% and Brazil 8.5%). Using the MPI indicators also reveals that the highest contributor to overall poverty in China is deprivation in education. One of the most useful ways in which the MPI could be used in China might be via its use in identifying “types” of multidimensional poverty. The MPI can be “decomposed” by population sub-group, or by area. This has already been done in a number of countries, such as Bolivia, Kenya and India. These studies have revealed striking differences within each country. China has adopted multidimensional approaches in its village poverty reduction programs during the last ten years, but more specific use of multidimensional indicators could enable types of poverty to be more clearly specified. OVERVIEW 2.2.1 Nutrition and Health related poverty

During the 18 years between 1990 and 2008, there have been large scale improvements in levels of child malnutrition in China. Yet currently, 14% of children are still suffering from slow-growth during puberty; and in poor villages this figure is 20%, falling within the middle severity category. In poor villages, rates of slow growth during puberty and numbers of under-weight children below the age of five are noticeably higher than those

in normal villages and cities. A survey in poor areas in Guangxi on nutritional conditions An Inclusive Poverty Reduction Strategy:

among 1324 children under age six has shown: 22.18% children suffering from slow Challenges and Recommendations growth in puberty, 28.17% under-weight, 11.12% with marasmus, and 16.19% with anemia-in which children at the age of 12 months suffer from the highest rate of slow growth during puberty, under-weight and marasmus. The main factors contributing to these outcomes include low intake of dairy and meat products, thin food composition, and excessive intake of snack food. These all lead to insufficient provision of energy and protein (Fang Zhifeng, 2010). A report by the WHO has also indicated that anyone who suffers from malnutrition can potentially lose 10% of life income. This statement underlines the inherent linkage between lack of nutrition and low income or poverty.

Although China has made considerable progress in poverty alleviation in the last thirty years, it has also experienced a health crisis affecting poor households (Dummer and Cook 2007). The decline in public provision of medical and health care caused by the segregation of urban and rural policy frameworks has led directly to an increasing gap in health care resource allocation between urban and rural areas, which has further increased the cost to migrant workers of using urban health care services. In the public health sector, as a result of inadequacies in information provision and the increasing gap between rural and urban incomes, the majority of poor rural areas and the low-income population have become the target of low-quality food and medicine sellers, making poor people more susceptible to potential harm.

Illness-related poverty has become a widespread phenomenon in rural areas, within the poor population and amongst urban low-income groups. The problem of ‘difficulties in seeing a doctor’ is acute for many people in poor rural areas. Firstly, healthcare resources are concentrated in urban areas, and this has caused difficulties in accessing these services for those living in distant villages (particularly in relation to referrals for major and serious diseases). Meanwhile, because poor villagers normally cannot afford the high costs of medical care, they often try to avoid incurring costs by delaying and trying to cope with their health problems. This results in a vicious cycle of ‘ignoring the minor disease, waiting until it is more serious, and when it becomes too serious, waiting to die’.

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 15 In addition, due to poverty, lack of knowledge of health and low awareness of self-care, poor people are more susceptible to disease. These factors form a cycle of illness and poverty, resulting in a continual return to poverty. Lack of medical security is a serious barrier for rural people, especially those living in remote poor areas, in achieving their socio-economic goals. Although the Chinese Communist Party Central Committee and the State Council have proposed to ‘gradually establish a new rural corporate medical system’ in the official document on ‘Some Decisions on further strengthening rural hygienic work’, the participation rate of poor rural households is still low in many areas. Even in those projects which have a relatively high poor household participation rate, the problem of low compensation rates is still significant (Xie Huiling et al 2008). Research shows that illness as an external factor may not necessarily lead to persistent poverty, yet its impact might last for about 20 years. Finally, it is important to stress an additional key fact that children, the elderly and women are more likely to suffer particularly from illness-related poverty.

2.2.2 Education and Poverty

Educational equity has become a national issue. The main reason for education-related poverty is the high costs associated with education. High costs can lead to families OVERVIEW and individuals falling into the poverty trap. The issue of education-related poverty has been eased to some extent following the introduction of the cost reduction policy on compulsory education, but this in itself is not sufficient. It is estimated that currently there are 5 million children of school age who cannot complete their compulsory education, and these children are mainly located in poor areas in western China. In non-compulsory education, the high cost of tuition has restricted access by many children from poor households; children from low-income and poor households drop out of school and lose educational opportunities, resulting in insufficient investment in human resources.

In particular, along with the enforcement of the ‘higher education expansion’ policy, and the marketization and globalization of higher education in the 21st century, higher education has become a crucial issue in education-related poverty and social stratification. In addition to the impact of increases in tuition fees not being adequately monitored, the limited schooling loan and scholarship system has also resulted in an

Challenges and Recommendations ‘inverted stimulation’, namely, it does not support vocational or higher level vocational

An Inclusive Poverty Reduction Strategy: education, but is confined to post-graduate degree education. This system undoubtedly increases the social costs for poor households hoping to alleviate their poverty through educating their children.

2.2.3 Targeting: A Key Issue

The issue of targeting in China’s poverty alleviation program contains two aspects: Firstly, income-oriented targeting does not take into account multiple poverty; it thus misses significant non-income poverty conditions. Many households above the income-based poverty line are actually poor because they are disadvantaged in non-income areas. The design and selection of poverty alleviation plans and projects must focus more on the income earning ability of households. Even those projects concerned with the improvement of the infrastructure, and with capacity building, are also oriented toward the goal of income growth, and do not take into account multiple development goals including nutrition, health, education, income and the equal rights of the poor population. The monitoring of poverty is also based on income and consumption and lacks a more comprehensive system for monitoring other dimensions of poverty. Secondly, income- oriented poverty alleviation projects do not benefit the poor population equally, and the problem of resource leakage is prominent. Village level development has improved the

16 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage targeting rate of poor villages; but within a village, the middle income and rich households still benefit more than the poor ones.

In recent years, there have been widespread discussions internationally on targeting mechanisms within poverty reduction programme. Many researchers have concluded that targeting in poverty reduction programs contains serious problems. For example: targeting often fails to fully cover poor households; targeting in participatory programes frequently results in elites capturing benefits; decentralized targeting often is characterized by corruption, thereby worsening inequality locally.

Until recently, most poverty reduction programs used approximate indicators to identify poor households. These indicators varied from estimates of basic needs to calculations of average incomes in a particular village, area, or region. Using poverty mapping techniques, and combining this with data from household surveys (thereby allowing linkages between consumption levels and household characteristics) is a much more OVERVIEW rigorous approach, and this has been introduced recently in some countries, notably in India, Indonesia and the Philippines. Targeting has undoubtedly been most successful where it has been based on multidimensional poverty indicators and where it aims to promote sustainable development out of poverty. The index of participatory poverty reduction adopted in the village-based poverty reduction programmes in the past ten years is considered an accurate targeting tool. However it has not been widely used due

to high costs of implementation and uses of complicated techniques. An Inclusive Poverty Reduction Strategy: Challenges and Recommendations 2.3 ‘Transitional Poverty’ in the Process of Urban-Rural Integration

‘Transitional poverty’ is closely related to the process of urban-rural integration. In the past thirty years, China has experienced the largest population migration in its peacetime history (WB 2009). This has created about 150 million migrants and their overall numbers are still increasing. This process of migration will continue for the next fifteen to twenty years. While the workforce in rural areas moves to cities and forms large numbers of migrant workers, it also creates a considerable number of “left-behind” people in rural areas, notably the elderly, children and women. This remaining “left-behind” population currently includes about 58 million children, 20 million old people and 47 million women, totaling 125 million people1 -a little less than the total number of rural migrant workers. On the other hand, rapid growth in the production of non-agricultural goods in the rural economy, and the rapid growth of urbanization have also increased demands to convert agricultural land to other uses, resulting in approximately 40 to 50 million farmers losing their land (Han Jun 2005).

In China, transitional poverty groups mainly include: migrant workers who work in cities yet lack adequate job security and protection from work injuries, health risks and experiencing inadequate security in elderly life; farmers who lose land, who do not benefit equally from appreciation in the value of land, and have insufficient access to the social security system; children and elderly who are left behind in the rural areas and are unable to be cared for by parents or sons and daughters; and women who are informally employed and lack adequate rights protection.

The risks that vulnerable groups have to face in the process of urban rural integration differ from the risks faced by groups experiencing conventional income poverty. Transitional poverty is generated in the process of moving from urban to rural areas. Specifically, it has the following characteristics:

1 The above data are quoted from National Women’s federation Children Department (2008), Ye Jingzhong et al (2008) and China Communist Party News Network (2008)

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 17 Firstly, identifying the population in transitional poverty necessarily involves a degree of uncertainty. Since the main risk for this group is vulnerability, only some of them will actually fall below the poverty line due to difficulties in coping with risks.

Secondly, transitional poverty is multi-dimensional, and thus those who fall into this category may not present as low income, rather they will be socially excluded, lacking equal access to public services, experiencing a meager spiritual life, and be short of development opportunities.

Thirdly, the territorial distribution of those in transitional poverty is uneven. Migrant workers and landless peasants are mainly concentrated in the south-east coastal area and in large and middle-size cities, particularly the latter. On the other hand, the left- behind population are concentrated mainly in the rural areas in the middle and west of China.

Fourthly, transitional poverty will leave some of the temporarily-impoverished population in a permanent poverty trap.

Fifthly, policy-related poverty is a key aspect of the transitional group. Problems such as insufficient social security provision, inadequate medical provision, discrimination in OVERVIEW the job market, and difficulties in enjoying the advantages of urbanization should all be considered as policy related issues.

Sixthly, women’s poverty is also prominent. Both those women who work in mobile positions and those left-behind face many problems-such as severe deprivation of their rights, psychological problems, hardship and poor health care. These problems not only affect the wellbeing of women themselves, but also reinforce inter-generational transmission of poverty.

Finally, transitional poverty is not permanent, but policy-sensitive. The main cause of transitional poverty is deficiency in the policy system rather than the inability of the poor. It is the macro-level policy system that defines urban-rural segregation, public service policy, and anti-poverty policy approaches, and which cannot cover adequately vulnerable groups emerging in the process of urban-rural integration. This population

Challenges and Recommendations is thus unable to cope with the risks associated with poverty. Therefore, improving the

An Inclusive Poverty Reduction Strategy: policy framework of urban-rural integration is key to solving the issue of transitional poverty.

2.3.1 Poverty Risks facing Rural Migrant Workers

Unstable employment and heavy workloads: Surveys show that in 2009 of those rural migrant workers who worked as employed staff, only 42.8% had a signed contract with their employers; 89.8% had a weekly working time in excess of 44 hours (regulated under the “labor law”); those who are employed in the hotel and catering industries work more than 60 hours per week.

Lack of medical and personal safety guarantee: In 2009, only 7.6% of employers paid pension insurance for rural migrant workers; 21.8% paid work injury insurance; 12.2% paid medical insurance; 3.9% paid unemployment insurance; and 2.3% paid reproduction insurance. The percentage of insured migrant workers in the eastern region is noticeably higher than in the middle and western areas.

Risks from illness: Rural migrant workers have problems with low income, poor living conditions, hygiene and safety conditions, low awareness of HIV/AIDS prevention, lack of access to medical care, and insufficient guidance on how to cope with HIV/ AIDS. In addition, migrant workers normally have greater mobility, and since urban and

18 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage rural medical services are not well connected, this makes it more difficult to trace the prevalence of HIV/AIDS. Once infected, it becomes not only a serious problem for the patient and family, but increases society’s burden. (Li Shaoqiang 2009). Consequently, HIV/AIDS prevention and treatment for rural migrant workers will also be an important health risk and management issue in poverty alleviation and economic development in the next ten years.

Social exclusion: In practice, discrimination against migrant workers is not only experienced at the level of legal and institutional arrangements, but also through bias and exclusion at conceptual, psychological and cultural levels. (Xuyong, 2006). Furthermore, the latter is normally more lasting and thus more difficult to eliminate than the former. Social exclusion reinforces the segregation of social strata, and thereby functions to keep rural migrant workers at the bottom of society.

Inter-generational poverty risk: Children of rural migrant workers cannot enjoy educational OVERVIEW rights equal to those of children of residents in cities; this will result in an increased educational gap between rural and urban children. Poverty can thus be transmitted from one generation to another.

Particular risks faced by female rural migrant workers: According to the large- scale survey carried out by the National Coordination Team on Women and Children’s Rights (2007), in 2006, only 36.4% of work units enforced the full length of legal maternal An Inclusive Poverty Reduction Strategy: leave for female migrant workers; only 12.8% reimbursed the costs associated with Challenges and Recommendations reproduction; 64.5% did not pay for maternal leave; 58.2% of female workers needed to go back to their original place to have pregnancy checks instead of having these in their place of employment; this not only caused them considerable inconvenience, but also increased women migrant workers ‘economic burden’ and difficulties in accessing jobs. Female migrant workers have stated that very often they feel exhausted, with 46.3% being ‘extremely tired’. This figure is 18 percentage higher than that for male migrant workers, and 11.5 percent higher than that for women remaining in villages.

2.3.2 Poverty Risks for Landless Farmers

Risks from unemployment and reduced incomes: Some landless farmers have obvious disadvantages in job markets due to their lack of non-agricultural skills, and a large proportion remain unemployed or semi-unemployed. Surveys show that the most difficult task that landless peasants face is to obtain new skills for other occupations. Additionally, the unemployment rate among the elderly who cannot easily adapt to new economic requirements and the number unskilled is increasing (State Council Development Research Center, 2009).

Lack of social security system: Only a relatively small number of landless peasants can enjoy the same social security service as urban residents. Most form a marginal group living in a social security vacuum.

Deprivation of social capital: Land deprivation also disaggregates the social system that is tied to the land such as the ties between distant relatives, neighbors, lineage members and community members; thus, whilst farmers lose their land, they also gradually lose their former social capital. A survey shows that 48% of interviewed landless farmers do not identify themselves as urban citizens (Yu Xiaohui, Zhang Haibo, 2006).

2.3.3 Poverty Risks for Those Left-behind

Psychological problems: Many of the left-behind children have much looser contact with their parents than their peers, thus they are inclined to experience more psychological problems and pressures (National Womenof the left-b Children Work Division, 2008).

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 19 Some left-behind women cannot stand the loneliness, and divorce rates increase (China Communist Party News network, 2009). Because children are not at their side and in most villages public cultural facilities and activities are scarce, nearly 50% of the left- behind elderly feel under pressure, and one third of them often feel lonely, and are frequently anxious, irritable and depressed (Ye Jingzhong 2008).

Health risks: The health conditions of many of the left-behind elderly are poor, and they lack caring in their daily lives and have heavy workloads. Many do not have sons or daughters at their side to take care of them when they are ill. Given the prominent trend of feminization of agriculture work (Zhen Yan 2008), the work intensity of left-behind women is increasing dramatically, and this not only seriously affects their health but also increase their susceptibility to disease; Yet many are unable to afford medical costs (Ye Jingzhong 2008).

Inadequate pension system: Surveys have shown that 81% of the left-behind elderly are still engaged in agricultural production; only 8% have obtained support from the state in cash or kind; and only 1% have social endowment insurance (Ye Jingzhong et al, 2008). This situation can only be improved when new rural endowment policies are enforced.

OVERVIEW 2.4 Governance Mechanisms: An Important Factor Influencing the Poverty Issue in the Future

Given the Chinese Central Government’s aim of taking income redistribution as a new agenda in its development strategy, various departments will sooner or later be involved in the overall development planning process, with social protection as its main concern. Therefore it is likely that more governmental agencies will take part in the poverty alleviation program in the future; consequently, there will be a growing demand for the establishment of efficient coordination across bureaucratic boundaries and a sound governance mechanism.

In rural areas, prior to the abolition of agricultural taxes, village organizations had clear behavioral goals, structure and functions, and also had the legitimacy and means to mobilize funding and resources. With fee reform and the ending of agricultural taxes, rural areas entered a new post-tax era. This change has had important consequences for

Challenges and Recommendations village governance. On the one hand, village public facility construction has experienced

An Inclusive Poverty Reduction Strategy: difficulties due to the pressure of grass-roots level debt and limits on expenditure; on the other hand, the connections between farmers and village cadres have become looser, and the behavioral choices of village elites have focused less on the overall needs of the village community. Furthermore, the material foundation of village administrative authority has weakened, and there appears to be a “vacuum” in village public authority (Tian Xianhong, 2006). This situation seriously affects the ability of the grass-roots community to mobilize resources and is also the root cause of village rent-seeking and the unequal distribution of resources.

2.4.1 Deterioration in Village Governance affects the Effectiveness of Rural Poverty Alleviation

The impact of weak village governance on poverty alleviation is mainly manifested as ‘elite capture’- atomized villagers lack organizational carriers and junior officials come to dominate resource allocation. Considerable research has been carried out internationally on elite capture in recent years. It has been analyzed as resulting from a combination of factors: unequal access to economic resources, knowledge and manipulation of political processes, higher levels of educational attainment and privileged networking. As a result of the dominance of village elites, poor groups comprised mainly of women and the

20 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage elderly cannot effectively participate in various projects due to their limited capacity and lack of access to resources. This situation has entrenched existing difficulties in poverty alleviation: on the one hand, due to the lack of existing organizational carriers, there are high costs associated with re-organizing weak groups in villages who are short of human, material and natural resources, and on the other hand, this will in turn affect the efficiency of poverty alleviation work.

2.4.2 Limited Capacity of the Poor Population for Self-Development

In the post-tax era, since the poor population formed largely of women and the elderly has limited capacities and access to use of natural resources, they have limited assets. Focusing on villagers use of assets - financial, physical, natural, social and cultural - is an approach used increasingly in poverty reduction programs internationally. It enables implementing agencies to target funds more directly to particular aspects of household’s livelihoods to facilitate the capacity of household members to lift them out of poverty. OVERVIEW In the context of poor village governance it is difficult to mobilize weak groups to form multi-functional and multidimensional social capital, and thus difficult to match the requirements and demands of external capital investment.

Fig. 1: How Deteriorating Rural Governance Affects Poverty Alleviation in the Post

Agricultural Tax Period An Inclusive Poverty Reduction Strategy: Challenges and Recommendations

This situation aggravates the outflow of resources from poor areas, which in turn lowers resource storage in villages and undermines the foundations for good village governance. This cycle limits the development capacity of women and the elderly, and puts them in a continuously self-weakening situation, constraining the possibilities for sustainable development of the village economy. Figure one illustrates this resource flow – governance – poverty alleviation interaction mechanism.

2.5 Climate Change and Environmental Deterioration: The Causes of Poverty as Defined by Vulnerability

Many of China’s poor areas are also highly sensitive to climate change. In 2008, the China Environment Protection Ministry issued ‘Guidelines for National Ecologically

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 21 Vulnerable Areas Protection and Planning’, in which eight ecologically vulnerable areas are circumscribed. These are: northeast forest-grassland ecotone, northern farm-pastoral ecotone, northwest oasis-desert ecotone, southern hilly region of red soil, karst rocky deteriorated mountains region, southwest mountain farm-pastoral ecotone, complex erosion region in Tibetan Plateau, coastal water-land ecotone (MEP 2008).

Most of China’s poor population lives in these areas. In 2005, there were 223.65 million poor people nationwide, of which more than 95% lived in the old revolutionary areas, ethnic minority areas, distant areas and poor areas, where ecological conditions are also extremely vulnerable (MEP 2008). Amongst the 592 key poverty alleviation counties, which are scattered in middle and western areas, more than 80% are located in ecologically vulnerable areas (MEP 2008). Green Peace and Oxfam have jointly issued a report showing the high degree of overlap between poor counties and ecologically vulnerable areas in China. This report on the Chinese situation reflects conclusions reached internationally on the impact of various aspects of climate change causing households to succumb to poverty, often rapidly with the onset of landslides and flooding.

2.5.1 Climate Change Intensifies the Vulnerability of People in Poor Areas and Increases the Risk of Returning to Poverty OVERVIEW Climate change has triggered a series of natural disasters in China, such as intensified drought, the withering of forest vegetation, worsened soil erosion and extreme climate incidence. These natural disasters inevitably result in a deterioration of the environment in ecologically vulnerable areas. Poor households in these areas have particular difficulties in dealing with climate change, since they face challenges in many aspects such as natural capital, human capital, technical equipment and alternative livelihoods. Poor rural households become more and more affected by the negative influence of climate change, and since they have limited ability to adapt to new situations, their livelihood vulnerability increases. This increasing vulnerability results in a relatively high rate of poverty incidence recurrence. Frequent natural disasters triggered by climate change have gradually become the main cause of poverty incidence and recurrent poverty.

There are three main factors causing poverty recurrence: namely, natural disasters, Challenges and Recommendations major illnesses, and population pressure. Within these, 70% of poverty recurrence is An Inclusive Poverty Reduction Strategy: caused by natural disasters (Li Jiayan 2005). Data from the National Statistical Bureau in 2003 showed that 55% of households returning to poverty in that year had suffered from natural disasters (Nie Zhongqiu 2007). Natural disaster may easily lead to a vicious cycle of ‘disaster-poverty-more disasters-poorer ’in ecologically vulnerable areas where the level of economic development level is already low.

The impact of this cycle has been assessed comprehensively in international research. During the last decade, considerable research has been undertaken in both developed and developing countries on the impact of climate change on poverty conditions. The vast majority of assessments conclude that poverty is one of the most powerful influences on household’s abilities to deal with the impact of climate change. Additionally, it has been concluded that poor households appear to rely more heavily on climate- sensitive resources than non-poor households

2.5.2 The Single-Dimensional Policy Objective: A Negative Impact on the Poor Population

In the process of seeking an effective method to deal with climate change, on the one hand constrained by many factors, the poor population has limited ability to cope with climate change risks; on the other hand, the current policy framework does not

22 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage adequately include their contributions to reducing the impact of climate change.

Effective policies, such as function-zoning, emission reduction and land conversion, sometimes may have the external effect of restricting the diversification of poor household’s production, and raising the cost of their livelihoods, thereby make them even more vulnerable. Policies for nature reserve areas have a multiple impact on local residents. Many natural reserve management regulations are not only about protection, but also about ecological compensation and the promotion of alternative livelihoods; however, these policies often do not take into consideration the vulnerability of the poor population, and thus may actually exclude these people to some extent.

Additionally, some measures initiated by poor groups themselves, such as cultivation regulations in drought periods and water-concentration techniques, are often not fully utilized due to resource constraints, lack of funds and technical support. OVERVIEW 3. Recommendations for China’s Poverty Reduction Strategy to Meet These Challenges

The issue of poverty has evolved with economic development and changes in social structure. The task of poverty reduction remains complicated and enduring. It requires focusing on long, middle and short term strategies, and on specific policies to deal with the constraining factors on the poor population’o development and poverty reduction; An Inclusive Poverty Reduction Strategy:

and finally to achieve the goal of poverty elimination. Focusing on the four major issues Challenges and Recommendations discussed thus far, the following aspects should be included in future poverty alleviation strategies and related policies.

3.1 Long-term Poverty Reduction Strategy

3.1.1 Establish an Inlcusive Urban-Rural Integrated Development Pattern to Benefit the Entire Poor Population

From a long-term perspective, China must establish a policy framework and development model which can benefit vulnerable groups and enable them to share the fruits of urban- rural integrated development, avoiding current problems such as the increasing income gap, segregation, and tensions between rich and the poor groups commonly evidenced in the process of urbanization in many developing countries. Specifically, recommended policies include:

(a) Fully developing labor intensive industries to provide adequate job opportunities for the large number of rural migrant workers; Extending training programs for migrant workers. These programs have proven successful not only in China, but in many other countries, notably in Andhra Pradesh, India, providing employment options for vulnerable young laborers, linking them to jobs in urban and semi-urban areas, following a three month training programme with staff from industries acting as mentors. In Bangladesh, similarly successful short-term programs have been implemented for poor rural households, preparing them with skills training for work in urban and semi-urban area, and with food assistance.

(b) Establishing urban-rural unified and equal production factor markets. Enforcing the‘de-elitized’ household registration reform, enabling most people who are employed in cities to register. Entitle rural land with complete ownership, equalize the right and price of rural and urban land; and guarantee fair ‘compensation’ for landless farmers.

(c) Establishing an urban-rural integrated rather than a segregated or ‘fragmented’ public service policy framework, and treating urban and rural residents together as one group;

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 23 set up a livelihood safety network covering and unifying urban and rural vulnerable groups at the national level. As outlined in the sub-report, international experience in this area stresses the need for policies to be “portable”. Many migrants enroll in social insurance schemes but then withdraw at a later stage because they cannot take the insurance benefits with them when they move. Additionally, often when they withdraw they can only take out their own contributions to these funds, whereas their employer’s contributions remain. To address migrant’s problems, not only must existing schemes be extended, but new independent programs must be created to meet the specific needs of rural-urban migrants. Considering the varying levels of economic development in different provinces and the current condition of fiscal transfer payments, it is suggested that each province be encouraged to unify the urban-rural public service systems within their jurisdiction, with support from the central government, to pave the way for a national integrated system as the next step.

(d) Establish a fiscal transfer payment institution which addresses the dimensions of poverty, together with a dual system of person and location affiliation. Public services such as education, medical care, pension provision and poverty alleviation should have stronger compensation mechanisms, emphasizing beneficiaries rather than their attributed locations. OVERVIEW

(e) Fully consider the accessibility of the rural left-behind to basic public services. In the allocation of fiscal funds, address the increasing financial need to provide urban public services resulting from increasing urbanization and the need for the rural left- behind to access public services, and ensure this benefits left-behind groups, rather than maintaining or extending their marginalization when making fiscal transfer payments.

3.1.2 Reducing Multidimensional Poverty: The Goal of the Poverty Alleviation strategy

The concept of multidimensional poverty needs to be integrated into national poverty alleviation strategies, possibly via the use of the Multidimensional Index and its accompanying monitoring system. Mitigating and eliminating multidimensional poverty must become a specific objective, in relation to nutrition, health, education, income and rights, as inter-related issues for achieving the overall strategic goal. As with the UN Challenges and Recommendations Millennium Development Goals, it is essential to put forward a time framework, outlining An Inclusive Poverty Reduction Strategy: specific steps and milestones for achieving the task of eliminating multidimensional poverty.

Since multidimensional poverty refers to many areas, including politics, economy, society and environment, it is necessary to establish a more effective governance structure at the macro-level to ensure that strategy and policy be inter-related and that a good partnership be established between the various departments. It is suggested to set up a responsive monitoring and evaluation mechanism to keep track of all departments in relation to their mandates and actual performances. It may also be necessary to strengthen the authority of the State Council Poverty Alleviation Leading Group and to improve the functioning of the Poverty Alleviation Office, so as to enhance its organizational capacity for coordination, and to put it in charge of monitoring and evaluation.

3.1.3 Village Governance: Taken as an Important Aspect in Rural Poverty Alleviation

From a longer-term perspective, current macro-level governance mechanisms should be reformed, based on the new challenges discussed above. The aim of reform is to establish an “overall” poverty alleviation governance system to effectively integrate

24 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage administrative and financial resources. At the same time, the anti-poverty campaign first needs to guarantee the basic livelihoods of poor and vulnerable groups, and further, to support their demands for sustainable development and diversification.

The emphasis must be on enhancing the organizational level of vulnerable groups, improving the governance system and satisfying their social and cultural needs. Consequently, it is necessary to comprehensively relate governance issues with other requirements for achieving sustainable development, such as environmental protection, and incorporate these elements into the overall policy framework for rural poverty alleviation. If we can establish an organizational structure that can absorb and utilize resources in the same process of human resource development, then it will be possible to upgrade labor resources into multi-functional and multi-dimensional social capital which can not only maintain basic livelihoods, but also promote sustainable agriculture and rural development in less developed areas. OVERVIEW

3.1.4 Enact Focused Policy to Deal with Climate Change Risks

Poverty alleviation strategies should be sensitive to climate change risks; these strategies must be suitable for mitigating the livelihood vulnerabilities of the poor population in ecologically vulnerable areas, and enhancing their capacity for sustainable development. The contribution that the poor population makes to reducing climate change (nature reserves/ development prohibition zones, grassland ecological construction projects and An Inclusive Poverty Reduction Strategy: food safety projects) must be recognized and fully compensated. Challenges and Recommendations

The importance of drawing on community-based knowledge in assisting poor households in adapting to the adverse economic and social aspects of climate change is stressed repeatedly in many commentaries internationally. Communities often have detailed time, place and event specific knowledge of local climate hazards and of how such hazards can affect their assets and productive activities. They also have the capacity to manage local social and ecological relationships that will be affected by climate change. Communities typically incur lower costs than external actors in implementing development and environmental projects. Community knowledge has been shown to be invaluable in a range of projects, from reforestation programs to fisheries renewal, nature reserve management, and in the protection of coastal areas.

In ecologically vulnerable areas, special poverty alleviation models should be established and special fiscal budget and transfer payments should be put in place. The amount and form of transfer payment needs to be formulated, taking into consideration the aim of eliminating the threat caused by climate change risks. It is important to improve local resident’s ability to cope with climate change risks in ecologically vulnerable areas where ethnic minorities are concentrated, such as the south-west karst mountainous area and stony desert covering areas of Sichuan, Yunnan, Guizhou, Chongqing and Guangxi; the south-west mountainous agriculture and pasture intersecting areas of Aba, Ganzi and Liangshan in Sichuan, Diqing, Lijiang, Nujiang in Yunnan and Liupanshui in the north- west Guizhou (containing approximately 40 cities and counties) and the Tibetan Plateau complex erosion area in Tibet and Qinghai. It is also necessary to consider the cultural development and activities of these ethnic minority communities.

3.2 Medium-term Poverty Alleviation Strategy

3.2.1 Establish an Urban-Rural Integrated Poverty Monitoring and Alleviation Policy System

Firstly, an urban-rural integrated poverty alleviation coordination and organizational institution needs to be established. It is essential to put poverty alleviation work in

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 25 both rural and urban areas into one unified framework and bridge the institutional gap previously existing between the two areas; and this demands necessary reforms of the administrative system and adjustments of the functional divisions between departments.

Secondly, considering the gap in the cost of living between rural and urban areas and its variation amongst different regions, it is necessary to devise a dynamic rather than a static poverty measuring system to effectively compare rural and urban poverty.

Thirdly, the poverty monitoring mechanism needs to be adjusted, and urban and rural residence integrated into one system in order to provide complete and coherent basic data for integrated poverty alleviation policy formulation.

Fourthly, more attention needs to be paid to vulnerable groups, in relation to transitional poverty, emphasizing poverty risk factors and taking transitional poverty as an important element in enhancing development capacity and increasing the development opportunities of vulnerable groups in future macro-level strategic planning. The new national poverty alleviation guidelines should incorporate transitional poverty and the population as a crucial part of the anti-poverty agenda. This requires a change in poverty alleviation and development guidelines from those previously aiming only at the rural

OVERVIEW areas, to adopt a wider scope covering the whole country, and specifically, to integrate the urban poor, migrants and the rural poor into a unified poverty alleviation framework, and to organically consolidate the work of poverty alleviation and development, social service and social security.

3.2.2 M&E and Policy Formulation on Multidimensional Poverty

Firstly, monitoring and evaluation systems must be adjusted, based on the concept of multidimensional poverty. This adjustment should also bear in mind international research stressing the efficacy of participatory approaches in multidimensional poverty monitoring. Adjustments will require a division of tasks and coordination between member units under the Leading Group of Poverty Alleviation (LGOP). Aiming at the strategic goal of multiple poverty alleviation in the new era, it is necessary to define specific poverty alleviation targets and monitoring methods for different sectors, and to form a monitoring and evaluation system which reflects specific conditions and tasks in

Challenges and Recommendations different departments and provinces, and which can be implemented regularly. Secondly,

An Inclusive Poverty Reduction Strategy: formulate specific plans and projects aimed at addressing multidimensional poverty. This demands coordination between the particular poverty alleviation and development policies formulated by various departments. Policy synergies will undoubtedly promotethe process of multiple-poverty alleviation.

3.2.3 Enhance Vulnerable Groups’ Organization: Good Governance

The stock of human and natural resource is generally low in poor areas and amongst vulnerable groups who are mainly women and the elderly. Additionally, capitalization of this type of human resources usually only generates low profits and it is thus difficult to afford the huge organizational costs incurred in the initial stage of organization.

Consequently, foundations for good governance can be set up in cultural and social areas with lower cost and easier access for women and the elderly, to facilitate the establishment of social organizations to reduce transaction costs. Beyond this, when conditions are more mature, it will be possible to enable vulnerable groups to help each other and coordinate with each other in the areas of production, purchasing and selling, and funding. They will be able to realize their objectives of diverting risks and stabilizing profits on the basis of comprehensive cooperation, and thus establish a basic foundation for sustainable development.

26 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Given that the poor population usually has relatively small-scale economic activities and a low-level of commoditization, it is recommended that special institutional arrangements be put in place to ensure equal accessibility and potential benefit in the process of establishing rural community corporative organizations. Possible options could include organizing poor households to form ‘mutual help teams’ and jointly input their labor, or the state providing financial and technical support to households via rural co-operatives.

3.2.4 Strengthen Risk Management for Climate Change, Policy Support and Capacity Building

Firstly, take climate change risk analysis and evaluation as an important element in poverty alleviation planning. Take the ecologically vulnerable area as the scope of analysis and evaluation, integrating indicators such as rainfall variation, drought and flood frequency into the existing statistical system so as to provide data bases for risk evaluation. OVERVIEW

Secondly, internalize social protection measures into the adaptation strategy, and quantify the policy support needed to realize the potential of self-initiated adaptation measures, and put this into a national budget entitled ‘special fund to support climate change adaptation in poverty alleviation’. Specifically, this includes: technical support for production structure adjustment, expertise and funds for alternative livelihoods, market information support, employment information for migrant workers, techniques and An Inclusive Poverty Reduction Strategy: network support, support to prevent and cope with natural disasters, etc. Challenges and Recommendations

Thirdly, promote capacity building, including leadership skills, capacity of information provision, technical and funding services, and create an active local commercial environment for the development of sustainable livelihoods. In recent years, internationally, there has been considerable discussion of micro-insurance organizations and their role in protecting poor household’s assets against losses resulting from the impact of climate events. In India, for example, smallholder farming households participate in a “weather-index” insurance scheme providing compensation when the shortfall in precipitation becomes severe2. Index-based insurance has also been introduced in recent years in other countries – Thailand, Mexico, Malawi and Mongolia. In each case payments are made as a result of changes in a public index triggered by climate events, such as rainfall recorded on a local rain gauge. Experiences in these countries indicate that payments can be calculated and disbursed quickly, often through the use of local microfinance organizations, without households’ filing insurance claims. Such rapid payments are useful particularly when households are poor with limited financial assets, but their assets can be pooled via co-operation.

3.3 Short-term Poverty Alleviation Policy

3.3.1 Improve Policies to Meet the Challenges of Transitional Poverty

In the near future, adjustment should begin with relevant policies aiming to benefit the transitional poor population to a greater extent than previously.

Firstly, improve the existing connections between urban and rural public service policies, in order to make preparations for a rural-urban integrated public service policy system. There are many cases of integration from which experiences can be drawn

2 See, for example, P.O.Manuamorn, “Scaling up Microinsurance: The Case of Weather Insurance for Smallholders in India”, Agriculture and Rural Development Discussion Paper no.36, World Bank, Washington DC, 2007. More generally, see also, B.J.Barnett and O.Mahul, “Weather Index Insurance for Agriculture and Rural Areas in Lower Income Countries”, Department of Applied Agricultural and Applied Economics, University of Georgia, 2006.

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 27 internationally. The Strategic Initiative Report on appropriate anti-poverty policies for the rural-urban transition, for example, cites a number of relevant examples, notably from the UK, USA, Germany, South Korea and Chile.

Secondly, there is a need to strengthen the poverty sensitive agricultural preferential policy as a counterpart to the current agricultural preferential policy. Building on this improvement, the Leading Group Office of Poverty Alleviation of the State Council should evaluate the effectiveness of poverty reduction (including that of relative poverty) through the robustness of current agricultural preferential policies and adding new initiatives. It is suggested that international donors provide technical support for the evaluation of effectiveness of these services and policies in poverty reduction.

Thirdly, on the basis of such an evaluation, new policies in poverty alleviation can be formulated, which can compensate for the‘poverty alleviation deficiency’ prevalent in both universal subsidy and income-oriented agricultural preferential policies. Specific policy measures include: expanding rural medical support coverage; establishing a production support fund for small households, in particular by further developing village level pilots via the‘mutual help fund’; Carrying out a comprehensive training program for vulnerable groups employed in cities; set up intervention projects for those left behind in the villages, OVERVIEW such as on medical care for the elderly.

Finally, begin household registration reform in large and middle size cities, to promote social inclusion of rural migrant workers in cities.

3.3.2 Implement Multidimensional Poverty Intervention Projects

Launch early childhood nutrition intervention programs (e.g. early-stage children’s food supplement); full implementation of the boarding school free nutritious meal plan; providing health care services for women and children in poor areas; Integrating early childhood education as a part of the public education system and providing special financial funding for it; expansion of compulsory education from nine years to twelve years; providing conditional cash transfer payments to enable children in poor households to receive education in order to address the issue of income poverty resulting from insufficient schooling. Challenges and Recommendations

An Inclusive Poverty Reduction Strategy: There is now a wealth of international experience on the use of conditional cash transfers on which China can draw, notably from the renowned Bolsa Familia Program in Brazil - currently covering almost 50 million people, or a quarter of the population, and requiring health clinic and school attendance. Similar larger-scale schemes have been implemented in other Latin American countries such as Mexico and Nicaragua. In Asia, Indonesia and Bangladesh have such programs, and Cambodia and Pakistan have pilot cash transfer schemes. Currently, Africa’s most notable Cash Transfer scheme is in Zambia, providing basic subsistence funds dependent on regular school attendance. Chapter 4 discusses these programs, also noting their limitations, particularly in relation to issues such as sustainability and improved learning outcomes. It is also crucial to enhance the rights awareness of the poor population by improving village governance.

It is recommended that the Leading Group Office of Poverty Alleviation (LGOP) develops a research framework for multidimensional poverty alleviation strategy, and that international development donors provide technical support to develop an indicator and monitoring/evaluation system for multidimensional poverty policies and their implementation.

3.3.3 Improve the Poverty Reduction System and Village Governance

28 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Firstly, efficiency improvements should be made in the traditional top-down poverty alleviation system. On the one hand, it is essential to improve the structure and functioning of current village level administration, particularly the capacity building of village institutions; on the other hand, professional civil organizations are needed and farmer organizations should also be further developed, particularly in relation to their role in bridging different stakeholders. In the next poverty alleviation program, the task of building capacity for village committees should be stressed, and the development of multiple civil organizations for poverty alleviation should be supported.

Secondly, efforts should be continued to reinforce multiple inputs into villages that have completed integrated village development planning, and increase financial inputs to support their social and cultural activities, and to enhance the organizational level of rural vulnerable groups. More policies should be enacted and conducted to support and promote rural social and cultural organizations that have broad yet limited group OVERVIEW participation, to transform them into comprehensive and multi-functional community cooperatives. Furthermore, on the basis of the development of multiple social organizations, good village governance will be achieved, which will ensure sustainability for poverty alleviation.

Thirdly, on the basis of a full consideration of funding coverage and safety, the robustness of rural financial corporations should be reinforced in the process of integrated village

development and village level mutual-support collectives. Policies and mechanisms An Inclusive Poverty Reduction Strategy:

should be enacted to enable groups with limited capacity to participate in financial Challenges and Recommendations cooperation initiatives. Specifically, the following should be included: cancellation of policy barriers on peasant cooperative finance; enacting policies to encourage rural cooperative finance organization development; providing “seed funding” for peasant cooperative financial organization via fiscal funds. In areas with mature conditions, the establishment of cross-village economic collectives should be encouraged. It is suggested that international donors identify the development of farmer organizations in poor areas in China as an important agenda in their specific country programme, with an emphasis on supporting pilots in different areas.

3.3.4 Strengthen Policies and Measures to Improve the Ability to Adapt to Climate Change

Firstly, since basic infrastructure is crucial for improving the ability of the poor population to adapt to climate change, construction of these facilities remains an important measure. However, when building, maintaining, or improving infrastructure, more attention should be paid to ecologically vulnerable areas, integrating this with policies on relocation.

Secondly, it is suggested that the Ministry of Finance establish a “climate change risk fund” to cope with natural disasters and reduce disaster damage, and to provide support for the poor population to enhance their capacity to adapt to climate change. Taking funds from the emission tax can be a first step in the development of this fund.

Thirdly, establish micro-insurance mechanisms in areas with high climate change risk, so that when households encounter assets losses caused by the negative effects of climate change, a maximum level of compensation can be provided, and the incidence of returning to, or falling into poverty, can be reduced. It is recommended to implement small scale micro-insurance pilot projects in poor areas, with reference to international experience, and that international development organizations provide support for the necessary research on livelihood safety insurance mechanisms in China’s rural areas, particularly via undertaking projects piloting community-based micro-insurance institutions.

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 29 Fourthly, it is recommended that the current ecological compensation system be reformed and a policy on the purchase of environmental services be formulated, for which international development organizations can design and implement pilot projects.

Fifthly, the agenda for improving the ability to adapt to climate change risk should be integrated into the twelfth five-year poverty alleviation plan, and its implementation and monitoring/evaluation system. Through the methods used in village participatory development planning, groups atparticular risk (from disease, accidents etc.) and groups at symbiotic risk (loss due to drought or flood) should be targeted as particular groups to diagnose, and for which feasible solutions and coping strategies can be proposed.

Table 1: Challenges for China’s Future Rural Poverty Reduction Strategy and Recommendations

Future challenges for China’s Poverty Alleviation Program • Nutrition and Basic Health Care related poverty Multiple Poverty and Poverty • Health and Illness related Poverty Targeting • Education and Poverty • Targeting: A Key Issue OVERVIEW Transitional Poverty in the • Poverty Risks faced by Rural Migrant Workers Process of Urban-Rural • Poverty Risks for Landless Farmers Integration • Poverty risks for those left-behind Village Governance and Rural • Deterioration in Village Governance affects the effectiveness of Rural Poverty Poverty Alleviation in the Post- Alleviation Tax Era • Limited Capacity of the Poor Population for Self-Development • Climate Change can increase the vulnerability of people in poor areas and Climate Change and enhance the risk of returning to poverty Vulnerability • Single-dimensional policy objectives have a negative impact on the poor population Recommendations for China to Respond to These Challenges • Establish an Inclusive Development Pattern to benefit the entire poor population • Ensure that reducing Multidimensional Poverty is the clear goal of the Poverty Challenges and Recommendations Long-term poverty reduction Alleviation Strategy

An Inclusive Poverty Reduction Strategy: strategy • Take the issue of Village Governance as an important aspect in rural poverty alleviation • Enact focused policy to deal with Climate Change risks • Establish an urban-rural integrated poverty monitoring and alleviation policy system • Monitoring & Evaluation and Policy Formulation should be based on assessing Middle term Poverty Alleviation levels of Multidimensional Poverty Strategy • Enhance the Organizational Level of Vulnerable Groups and set up Good Governance • Strengthen Climate Change Risk Management, Policy Support and Capacity Building • Improve current policies to meet the challenges of Transitional Poverty • Implement Multidimensional Poverty Intervention Projects Short-term Poverty Alleviation Policy • Implement Multiple Inputs and improve Village Governance • Strengthen policies and measures to improve the ability to adapt to Climate Change

30 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Multi-dimensional Poverty ONE Measurement and Targeting 31 Multidimensional poverty Multidimensional Concept of multidimensional poverty and its evolution Gaps between poverty alleviation practice and real demands Multi-dimensional Poverty Measurement and Measurement Poverty Multi-dimensional Targeting Century. The pluralism of poverty has been taken into account by st Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage ONE The concept of multidimensional poverty was first put forward in the mid-to late 1990s, and has been adopted for China’s poverty alleviation strategies and practices since the beginning of the 21 1.1 The concept of multidimensional poverty in China of multidimensional poverty 1.1 The concept Multidimensional poverty is poverty caused by deficiency or lack of well-being (including social services). It reflects the poverty situationbetween the failure duringof original welfarethe mechanisms socioeconomicand the gradual establishment transitionof a new welfare supply system. When a family cannot afford basic non-income welfare with its income, these results in an ever-increasing “social cost externalization” on society that poverty emerges. Then multidimensional ultimately is the result of conflicts in policy. 1. Introduction The scientific study of poverty has been undertaken for more than 100 years in China. Only a few western countries use the concept welfareof multidimensionaldistribution poverty in sincethese the countries citizens, is and sufficientlythe extra income wellreceived establishedby each individual to is is reachregardedparticularly asimportant most earnings. to introduceIt multidimensional poverty and related indicators in China, for the following reasons: firstly, multidimensional poverty can reveal inequalities As the first poverty alleviation and development program 2001-2010end, iswe comingneed to to the clarify the concept besides advances, society as that ofstated clearly be should It system. policy new country’s multidimensional poverty and adopt it for theincome poverty, we need to consider poverty caused by inadequate health, education, employment, etc. This means a broader concept of poverty with monetary aspects. connotations beyond Individual needs differ according employment toand basic circumstances,social insurance. However, fundamental rights granted suchto every as thosecitizen by ofthe Constitutionendowment, (including equal rights to education and and know, the health,right to participation), thehave become a rightpart of topeople’s basic needs. Many needs related to well-being cannot be purchased with income. Thus, a strict income- poverty concept does not address people’s basic needs of well-being, nor can it adapt to the building of an all-round, well-off society where common progress is required to meet political, economic, social, cultural and ecological needs. As China progresses from an overall“well-off” stage,“well-off” the basic (Xiaosocial contradictionKang) between stagepeople’s cultural growingtoneeds on the one materialanhand, and limited social andall-aroundproductivity on the is other, becoming will individuals stages, new to progresses society as specifically, More acute. increasingly their needs will increase further. rather, no longer be satisfied with basic subsistence; the eight identifiable indicators of poor groups in the Whole-Village PovertyStrategy Alleviation and by Participatory Poverty Assessments. An empowerment mechanism has been adopted for select projects with villager participation. The China State Bureau has used Statisticalthe term “multi-dimensional poverty” in China Rural Poverty Monitoring Reports since 2007. Multi-dimensional Poverty Measurement and Targeting ONE instrumental measures cannot besolvedonlyby Institutional problems Challenges 32 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy the current stage. This is not purely a technical problem of targeting. of problem technical a purely not is This stage. current the underprivileged groups cannot enjoy benefits due to the lack of a clear means for testing for means clear a of lack the to due benefits enjoy cannot groups underprivileged that countries, developed many by experienced problem institutional general a is there stage. new Additionally,the in needs meets that one new a with system old the replacing safeguards for poverty reduction in the new era, and thus to promote consistency consistency promote to thus and era, new the between policyandactivitiesinpovertyreduction. in reduction poverty for safeguards policy provide to order been in so not do to have important is it policy,practice national into integrated formally reduction poverty the in since implemented secondly, poverty; activities of degree multidimensional the and services social basic of supply the in that in period, poverty” “subsistence the during faced problems from different are society off well- a for alleviation poverty in arising the challenges during present the however, years; alleviation 30 poverty last of area the in renown world achieved has China Firstly, and adopt to China dynamics, for multidimensional povertyalleviationpolicies. time opportune population an as this China’s view we conditions, alleviation, international current poverty of challenges the on Based 1.3 Whymultidimensionalpovertyalleviation policiesinChina? underprivileged of ossification the “stratum” intosuch“classes”. precede that sensitivity policy of connotations has the to counter runs idea ofbuildingaharmonioussociety.This Therefore, theconceptofmultidimensionalpoverty “revolution”. a via realized be only may society equal more a If no effective preventive measures are taken before these “stratum” solidify into “classes”, further increasethenumberswithinlow-incomeorunderprivilegedstratum. to due well-being, could that process social formation wealth reverse of a to rise give level will This incomes. limited their adequate an or afford to able ordinary supplies, be of longer number no large inadequate will a people to resources, due limited to due goods goods private into quasi-public monopolised into medical and transformed education are as such services goods public as However, goods. both public of and consumption private including consumption, through realized usually is Well-being 3) are sharedbythepeople. common to lead that that achievements development and livelihoods on results focusing process prosperity.a is in This equality finally and development, for processes equal to access conditions, basic equal with begins and opportunities, equal means Equality equality.of pursuit the for strategy a contains poverty multidimensional of concept 2) The Reform andOpening. have which China’s since society” of whole the alleviation by participation with government the by “guided been poverty China’s in achievements the by proven been has This performance. economic determine that variables include systems political so systems, political by guaranteed and defined are system economic an in rules formal While issue. economic strictly a by as poverty proposed considering to standard accustomed line and economists poverty mainstream the by field the influenced to often are limited not People is and economics. of concept socio-political a is poverty Multidimensional 1) three has poverty multidimensional of concept aspects, asfollows: The society. well-off all-round an of development the for entitlements of realization the and development, people-centred for necessary income of needs basic the involves poverty multidimensional of concept The 1.2 Theconnotationofmultidimensionalpoverty the previous poverty alleviation policy system has failed to meet the actual needs in in needs actual the meet to failed has system policy alleviation poverty previous the This is a problem of problem a is This Multi-dimensional Poverty ONE Measurement and Targeting 33 Population dynamics and Population dynamics future trend more inclusive analytical poverty framework in order to Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Since well-being is multidimensional, poverty alleviation must be adapted to

Fifthly, China’s model of poverty One alleviationof the most isnotable worthyoutcomes of of China’s studyPeaceful peaceful development is byrise an important otheris objective of its global countries.povertypoverty alleviation. In alleviation.case- study examples from Yunnan Province experiences multidimensional poverty alleviation. It is necessary for us to sum up China’s we can see that China isin rankedmultidimensional highly in poverty alleviationalleviation, objectives with sustainable developmentcombine objectives, and furtherfuture explore be would This alleviation. poverty multidimensional of concept operational and the systematic multidimensional poverty a great contribution to global poverty alleviation. Based on China’s active involvement in poverty alleviation and international exchange and cooperation in the development field, China is ideally positioned to make international contributions to this field, bymultidimensional poverty alleviation strategies. adopting Fourthly, understanding of the multidimensional povertyuntil now but conceptit still rests on hasoperation and monitoring beenlevels. There is still sufficient a strong need for a breakthrough at the policy level. Accordingalleviation and China’s development, to the opportune studiestime to develop and a policy analysessystem for of poverty multidimensional poverty is during the transition from traditional to inclusive growth. This alleviation in the new era. will be crucial for development and poverty the variational requirements of well-being. Poverty alleviation is an integralBased on partthe targetof of a eliminatingcountry’s absolute povertyoverall in experiences learnt from Chinathe development Minimum Livelihood bySafeguards scheme that 2020,education and as strategy.well as the 2. Analytical Framework for Multidimensional Indicators and Tentative Poverty Thirdly, China now has entered into the “inclusive growth” recognizedera, but indicatorthere is systemno widely for this period. Economistshead count ratio focusof poverty onpopulation, Gini indicatorscoefficient, expenditure ofsuch public education as and healthcare, employment and the gaps between urban here and we are rural proposing areas.a However, Secondly, Secondly, from the perspective of China’s future and the development of human well- being, forward-looking strategic research is needed. In the past 250 years along with the progress of industrialization, less than 1 billion of the population has been modernized, and these people are concentrated mainly 50in years,the the developedworld modernizedcountries. population includingIn thethose fromfuture billionChina may or exceed more; 2 however, research must be conductedenvironmental problems emerging during the process of population modernization, and a focusing on the resource and and poverty reduction. explored for sustainable development feasible path must be contribute to inclusive growth. We recognize poverty alleviation the is statusan improvementof well-being,in which at least in principleliving standards (income, includes consumption and assets); 2) health; the3) education; 4) following:individual 1) material activities including work; 5) political voice and governance; 6) relationships; 7) the environment (current and socialfuture conditions); 8) economic or physical connections and (in) security. and monitoring horizontal transfer payments for multidimensional poverty The alleviation. previously set criteria for one-dimensional poverty (that took income and consumptionas leading factors) cannot reflect the actual status of poverty, and can resource effective hardly allocation or poverty monitoring for poverty alleviation. It facilitateis an arduous common prosperity. to further eliminate poverty and realize long-term task for China Multi-dimensional Poverty Measurement and Targeting ONE poverty of multidimensional understand theconcept Figure helpsto well-being inclusion andeconomic capabilities, social dimensions ofindividual measured inthreecore Degree ofpoverty 34 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy defined asnon-poverty(theareamarkedwithH). indicates dimensions is conditions these three by restricted not all status G). Any with of marked area (the poverty abject deprivation or Deficiency F). and E D, with marked areas (the poor very being indicates dimensions two any in deprivation or or Deficiency C). Deficiency and B A, with well-being. marked areas (the poor being economic indicates dimension one any overall in deprivation and environment social the capabilities, individual by influenced is area given a in poverty Individual 2). Fig. in shown (as poverty We use a simplified three-dimensional diagram to explain the concept of multidimensional the elderly. for provision to related problems and groups disadvantaged of employment education, nutrition, healthcare, namely development: human to related poverty multidimensional of issues core the explore mainly will report security, this low with fields key are healthcare perspective, but also modelled on China’s conditions. According to Dimension B in in B Dimension to According conditions. China’s on modelled also but perspective, international its in poverty multidimensional presenting framework analytical an is 3 Fig. This isagreatchallenge. result. ideal an achieve to order in well-being economic capability,and of inclusion social systems the change to made be only can attempts then unchanged, in are circumstances ahead macro- external getting the if from good, is aspiration them the While removed. be preventing must dimension are each that obstacles those alleviation, poverty through poverty of the out lifted If be to are “G”) alleviation. marked area core poverty the (in for poor the of needed poorest be of will that efforts interaction more the the and of be, will result poverty the the severe more is the involved, are poverty that dimensions that more The see factors. multidimensional can we figure, above the From measurement approach for the United States? Social Science Research 37 (2008) 559–580. (2008) 37 Research Science Social States? United the for approach measurement Source: Adopted from Udaya R. Wagle (2008). Multidimensional poverty: An alternative alternative An poverty: Multidimensional (2008). Wagle R. Udaya from Adopted Source: Fig. 2: The multidimensionalpovertyspace Multi-dimensional Poverty ONE Measurement and Targeting 35 The tentative indicators of multidimensional poverty t in economic status of health n l Cultura personality participatio inclusion • Will and • Social status of work

the Platform of social suppor s l rk Status eekly work inclusion Capability Economic Economic well-being • Employment • W • Wo financial statu Satisfaction with • Problem solving capability • Education leve • Status of health s Fig. 3 should be included in future policy, poverty measurement ting ice in individual capability dimension; Political people’ initiatives inclusion Fig. 3: Analytical model of multidimensional poverty Fig. 3: • Vo • Respect for • Vo Path of individual development Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Some indicators that from arethe model,difficult but not tobecause significantuse these indicators in indicators are measurementselected for arethis unimportant.research inmultidimensional haveorder Onlyto poverty clarifybeen the and the multidimensionalmostconcepts removed of poverty alleviationsimpler and easier to Three use. of the dimensions - capabilities, economic inclusion and and to make them economic well-being in This model clearly presents a people-centred development path, and shows that it is the government’s responsibility to provide software and hardware support for development in any external or integrated poverty of alleviationmultidimensional environment.poverty and Fromflowing theindividual perspectivedevelopmentindicators which are difficult to measure andpaths, hold other indicators, which are more easily remove some to monitor. Strategic poverty alleviation indicators can be screened and identified based on the following principles: “adhering to improvingpeople-centred people’s livelihoods, development, establishing a securingsocial safety-netand payingcovering attention allto solvingresidents, problems related to education, labour employment, medical health and sanitation, safeguards for the aged development for the people, relying on the people and shared by the people.” and shelter; realizing the outcome of Only some indicators in these three dimensions are adopted: the and targeting. Fig. 2, the abstract factor of social inclusion is dividedpolitical inclusioninto twoand culturalsubsystems inclusion.including Economic well-being is divided intoinclusion economic and economic welfare. Many factors with in“capabilities building” as these the foundation. The subsystems key point is to findare suitable jobs ininterrelated, the economic inclusion dimension, since farmers without jobs mean people without earnings “hardware” the as to referred is support social for platform The well-being. satisfactory and of social infrastructure and the “software” of social services, path for individuals to gain well-being. form a development while longitudinal factors and education level Multi-dimensional Poverty Measurement and Targeting ONE 36 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy Individual Capabilities Economic well-being Economic inclusion Dimension of satisfaction with financial status financial with satisfaction of inclusion system, and the two interrelated indicators of indicators interrelated two the and system, inclusion economic inclusionandindividualcapabilities. (see selected are participation social and inclusion • Individualjudgmentsofhousehold financialstatus(theoretically • Statusofsavingsandliabilities • Householdgrossexpenditure • Householdgrossincome Satisfaction levelswithfinancialstatus • Incomefromtaxde-rating • Incomefromgovernmentalpolicysubsidies • Transfer income • Asset/capital incomes • Salary/wageincomes • Operationalincomesformagricultureandnon-agriculture Household income • Employmenttrainingandemploymentarrangementsforvulnerablegroups • Wag/salary incrementalstatusoftheemployed • Employmentratesaccordingtointernationalstatisticalstandards Work status(employment) • Numberofcounty-levelregionswithfreeeducationforstudentsfromgrades1-12. • Proportionofgovernmentsponsorededucationexpenditureintotallocal • Establishmentofruralspecialschools(e.g.,schoolfordisabled)andserviceprovision • Household affordability for students’ education expenses (monitoring the proportion of • Educationalequity(thegapsbetweenruralandurbaneducationshallbenarrowedin Education level • Provisionfortheelderly(safeguardsandrelatedsocialarrangements • Accidental injuryanddeformity(productionsafetymonitoringinformation • Safedrinkingwater(proportionofruralpopulationwhousetapwater) • Medicalhealthcare(mortalityofpregnantandlying-inwomen,mortalitynewborn • Nutritionanddevelopment(ofinfants,babies,schoolingchildrenmiddleschool Health Status or happinessindex=utility/expectation) governmental fiscalexpenditure students tuitionfeeandrelatedfeesinthetotalhouseholdnet/disposableincome) and thegraduationrates) the followingaspects:pre-schooleducation,registrationratesofschoolingchildren rather thanpurecommercialendowmentinsurance) prevention from AIDS/HIV andtreatmentofpatients). disclosure, custodyofleft-behindchildren,reliefandsupportfordisabled,integrated children immunization,andmedicalsafeguards) and childrenunderfiveyearsold,motherhoodinfantshealthcare;coverageof students) Table 2. Tentative indicatorsofmultidimensionalpoverty in economic well-being. Three indicators on political political on indicators Three well-being. economic in Indicator ), as a basis for measuring measuring for basis a as Table 2), household income and degree degree and income household , levelofsatisfaction Multi-dimensional Poverty ONE Measurement and Targeting 37 Financial status can show more than income alone Gender perspective in multidimensional poverty Specifications on indicator application . (the State Council [2006] “Key Indicators in Gender governmental agencies opinions-attention policies (indicator for soliciting people’s formulation of government voices) livelihoods must based on people’s to people’s Congress in the National People’s total representatives leaders at county and township levels. voting for governmental information imposition Voices of the masses of the Voices voices can be heard by of channels through which the mass’s • Monitoring indicator impact appraisal during the voice” in the livelihood of “people’s • Representativeness as a percentage of from rural areas and ethnic minorities • Number of representatives Participation in voting participating in the representatives of the total representatives • Proportion of mass Social participation of regulations, policies and business • Dissemination and communication channels cultural activities. • Statistics of masses participating in social Respect for people’s initiatives people’s Respect for government rather than by masses with assistance been achieved by the • What has Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Political inclusion Cultural inclusion Since poverty reduction activities depend to a considerable above extent tentativeupon indicatorslocation, thecurrently are used mainly in targetingguiding processthe planningin poverty/regional reduction. These indicators, income-basedunlike povertythose reduction,used are in closely former related to overall national socioeconomicdevelopment targets. With regard to indicators to be used in sectoral poverty reduction and poverty effect evaluation, Additionally, multidimensional poverty concept has been incorporated into national policy. detailed indicatorswithin the shouldindicators set, bethose designedbelonging capability, economicto inclusion theafterand economic firstwelfare) are threethecore indicators dimensionsfor measuring (in individual poverty, and those belonging to the political inclusion and social inclusion group can be used as auxiliary indicators. No. 1). Among these dimensions, gender perspectiveis never directlyis anreflected impliedin the prerequisite,indicators. Everyand dimensionthoughanalyzed needsfromit toa genderbe consideredperspective. Data can departments, besince the obtainedCentral Government directlypublished its from related Eight of the nine selected indicators from the five dimensions are objective. The “degree of satisfaction with financial status” indicator is subjective, and is based upon individual household income and the country’ssubsidies, etc.). Degree of satisfaction with financial status is the result ofmacro the interaction policies (e.g., between private investment and interpersonal relations (prior to and after transfer income polices for tax, prices, or payment) and a country’s tax policy andimpact degree on of people’sinflation, satisfaction,which have theira strongwell-being, the process of building a harmonious society indicator can play an influential role during and mental health. Therefore, this The problem of housing is an important strategic issue, but it is dependent on institutional institutional on dependent is it but issue, strategic important an is housing of problem The arrangements for land, ownership of which is the object of long-term reform. Additional constraining factors will need to regardingbe included housing,in discussions a domainon will not be discussed for the moment in this report. it consequently, povertyrelated alleviation, to government provision of social services; of Children in China” by the General Office of the State Council Statistic for Programme for the Development of Women and Programme for Development Multi-dimensional Poverty Measurement and Targeting ONE but nottailwagsdog” be seen as “dog wags tail Economic growthshould capability resultsin As ametaphor-human political will responsible systemsand Achieving MDGsneeds of poverty exclusion” fortheissue method of“social proposed ananalysis The UnitedNationshas 38 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy A recent UN report on Rethinking Poverty: Report on the World Social Situation 2010 Situation Social World the on Report Poverty: Rethinking on report UN recent A 3. Status and Analysis of Multidimensional Poverty in in Poverty China Multidimensional of Analysis and Status 3. The UNDP’s 30 countries 30 UNDP’s The analyze therootcausesofpoverty. to used be also would but center, the at people place only not would exclusion social of oriented policies suitable for different countries. It also indicated that an analytical method equality- and development sustainable to decades recent of practices and policies fundamentalism, market the from shift a change, strategic for need urgent an confirmed been has however, research, conducted sincethebeginningof21 methodological focused More is studies, discussions. case certain of methodological on exception the and with institutions alleviation, on poverty research of most policies another, to country one from system. differs UN poverty the by Since initiated evaluation and monitoring their and strategies, alleviation poverty MDG-based on focused mostly is policies and institutions concerning operations. Research and methods on focuses poverty multidimensional on research Generally, 3.2.1 Researchprogressonmultidimensionalpoverty multidimensional of experiences poverty alleviation and research International 3.2 family possessionsfordisadvantagedgroups. in increase of rate slow the and education health, nutrition, of those mainly are China in poverty multidimensional of issues core The impoverishment. causing factors numerous there isstillalargepoorpopulationwithrelativelysevere,deep-rootedpoverty. There are development; a unbalanced severely and income capita country,per still developing lower with is China since challenging very remains alleviation poverty of task the However, UN is makingasignificantcontributiontoglobaldevelopmentandpovertyalleviation. meet to country first the China . population is poor extremely its halving by China (MDGs) Goals Development Millennium 3.6%. to million population 35.97 rural to 1978 30.7% in from million 2009, 250 in the from declined Government, has China Chinese in the decreased. poor by rural set of number substantially standards has alleviation poor of poverty the number to the According and improve, to continued standards have living People’s rapidly. developing been has economy China’s Opening-up, and Reform after especially and China, of Republic People’s the of founding the Since 3.1 StatusofmultidimensionalpovertyinChina growth, and the latter is dependent upon the former. This can lead to an economy economy an to lead can This former. the upon dependent is latter the and growth, economic with help can capabilities people’s of development the in investing rule, a As countries. affected in development human for more do would intervention development developing then for CAPA, with approach analysis cost-benefit the replace requirements organizations if that international out points Clements fundamental education. and health the nutrition, as such capabilities Project includes human to which Approach (CAPA), Capabilities the of Analysis significance the establishes Clements Paul a or withdrawn are of humanityiftheycanbesustainedbeyond2015. funds when development the for achievements overturned meaningful be only be will MDGs occurs. crisis may financial efforts and work hard through achieved gains addition, In will. political and processes, systems, rules, responsible and effective without achievements development into transform cannot growth economic that

assessment of the challenges of achieving the MDGs shows shows MDGs the achieving of challenges the of assessment st Century.

Multi-dimensional Poverty ONE Measurement and Targeting 39 Malaysia pays much attention to poverty alleviation Emphasis on agricultural development Experience of Japan and South Korea Experience of the U.S. Nutrition and health, education and employment are main Method and tools for Method multi- measurement of dimensional poverty South South Korea about 12 with too many assumptions; for instance, the

the U.S. is still the most advanced country in the world. It`s and psychology. and Most psychology. of the research focuses on the measurement

Sabina et.al developed a multidimensional poverty index focused mainly

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage and the Four Asian Tigers (Hong South Kong, Taiwan, Korea and Singapore) are of multidimensional poverty. A standard method for analyzing multidimensional poverty is to monitor the sub-goals in the MDGs. However, some critics haveMDGs are pointed technocratic outformulations that on international poverty comparison, with indicators closely related to the indicators for poverty reduction in China. the MDGs, which thus is not strictly relevant of Poverty is a multidimensional phenomenon, and poverty pro-poor instance, for growth, economic national and regional link to strategies integrated alleviation requires a set of growth for poverty alleviation. Historically, domestic and foreign experiences indicate 3.3 Analysis of China’s multidimensional poverty Analysis of China’s 3.3 continuous economic growth has benefited from extensive government investment and emphasis on education. For example, the National Schoolas a Lunch nationalAct issuedsecurity in measure,1946 supported basic learn healthcarefrom the United and States nutrition.in the areas Chinaof income distribution, can poverty alleviation and employment training. also recognized as countries and regions that have successfully engineered a leap from middle-income status to high income status. It took Japan and Despite the financial crisis, Japan years to become high-income countries. Compared with the comparatively long process of industrial revolution experienced by Western developed countries, we can learn more from Japan and South Korea. In addition countries paid considerable toattention to people’s livelihoods and upgradingtrying to narrow income the industrial structure, gaps. both In this example, the most important point for China is to learn attentionfrom Malaysia’sto solvingspecial the problem of development in rural areas whileeconomic maintaining rapid growth. From 1971 to Government on the poor population and the development of rural areas took up 19.1% of 1990, expenditures by the the Malaysiantotal expenses on development (MYR$172.1 billion Federationin total). From 1991 to 2000 the percentage increased to 22.5%. Malaysia is now a middle-income country. As a multicultural developing country, Malaysia As a multicultural developing country, Malaysia is now a middle-income country. adopted a unique mode of development with equity in the 35 years from 1971 to 2005, which set National Unity as the ultimate development goal. In the process of continuous and fast economic development, a reconstruction dualwas adoptedstrategy to achieve thisof goal. povertyBetween 1970 and elimination2005 to 0.5%, respectively. rate in Malaysia decreased from 49.3% the poverty and social 3.2.2 Experience in multidimensional poverty alleviation in some countries 3.2.2 Experience in multidimensional Studies on multidimensional poverty have been conducted in many disciplines such as education, medicine that can grow on a more equal basis, and which foundation. in turn lays a more people-oriented availability of the funds. International Agricultural Recently, Fund Development for (IFAD) which measures rural poverty. Tool, Assessment developed the Multidimensional Poverty It has been tested in Gansu Province, China and in India. This tool includes ten thematic indicators, but it is still a open question as to what extent this made adequately operational (for instance, in sensitivity tests for grain and nutrition), and set of indicators can be whether the assumptions of agricultural and non-agricultural assets can be effective at the same time. Multi-dimensional Poverty Measurement and Targeting ONE alleviation dimensional poverty approaches tomulti- in Chinamayprovide main aspectsofpoverty Paying attentiontothe being status changeofwell- Poverty alleviationisa development sustainable progressand provide equityfor Public goodsbest absolute poverty reduce inflationand fundamental needsmay Starting from dimensional poverty aspects ofmulti- 40 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy (4) The capability approach proposed by Amartya Sen provides a philosophical and and incomplete deliberately being its philosophical to a due However, alleviation. poverty provides for basis Sen social Amartya by proposed approach capability The (4) in thecontextofChina’s situation. are they conducted if be should even China in poverty well-being, multidimensional of analysis improved Therefore, of realized. objectives the into and shaped be can development thoughts of goals the especially these extent what to or realized, be thought-can neoliberal by initiated alleviation poverty countries- Western in reductionism from the of originating thinking linear change the whether known the not still is seeking It groups. of poor the of process well-being non-linear complex a is alleviation Poverty (3) Shaanxi County, Wuqi in services Province. medical free of case the in again proven been has This China. of Republic People’s the of founding the since strongly so supported been not had services medical and education basic if possible been and not have Reform would Opening China’s after growth economic and rapid The permanent society. for have benefits services these sustainable run, long the in remarkable but have growth, not economic may on these effects term, short the In fairness. of interests the reflecting affected by wide range of factors such as politics, economics, culture and society, is thereby education and healthcare as such services and facilities public basic of Provision (2) and serviceswiththeirincome. goods public affordrequired cannot the households farming poor which in circle vicious a prevent can services social adequate providing micro-level, a On needs. basic people’s satisfying while pressures inflationary reduce can services social basic of provision level, macro- a on people, the of needs fundamental the meet and poverty Toeliminate (1) in China. The fivemainreasonsforthis: for indispensable are training and poverty multidimensional of issues core are people’sand employment, decent and health education, healthcare, basic Nutrition, well-being. social and growth economic between gap societal negative to lead will growth population of process the in services healthcare and training education, basic to access limited that • Povertycausedbypoornutrition andbasichealthcare 3.3.1 Nutritionandhealth and fundsallocationintheurban minimumlivingstandardsprograminChina. education and health targeting of practice the in effectiveness the by proven been has and groups social of ossification ofstratification social strata, so as to help build a well-off society in an all-aroundthe way. This reducing to defined beneficial are and goals impartial the is poor), realized as not have that regions and the (groups harms goals turn development in This groups. social and economic in gap the disadvantaged as defined is society.Poverty harmonious of a of formation stigmatization the to led has and defined broadly too been often has poverty of concept the arena, development the In (5) met intheprocessofall-aroundpeople-orientedeconomic andsocialdevelopment. be will needs these Instead, alleviation. poverty of scope the within not are capabilities and situations individual different from originated needs Other issue. the of heart the at is employment and education health, and nutrition basic of perspectives the from China in alleviation poverty Analyzing future. comprehensive near the and in China than in specific practices alleviation guide rather poverty to objects unsuitable to them makes attention emphasis more This devote people. approach this upon indicators the based of Most developed practice. be alleviation to poverty proven in has operations approach guide this to abstract education, too on effect slow a with and operation its in

Multi-dimensional Poverty ONE Measurement and Targeting 41 The rate of growth The rate for rural poor retardation is nearly 20% children The Guangxi case Low income is related to malnutrition Backward healthcare services and increased vulnerability of poor groups Problems of the aged Gap between the reality and goals of the MDGs Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage One of the main tasks of populationrequirement andof socialthe MDGs,development is to inreduce rate China, theand maternalandunder also mortality fivea mortalityratio, infantrate.Development mortality Theof WomenGovernment in China of (2001-2010)China’s and ProgrammeofProgramme Children in for Chinafor the (2001-2010) Developmenttheboth stated that by 2010 the maternalin mortalityChina willratio decrease by one fourth, to 39.8 per 100,000 rate in persons 2000. Infant comparedmortality rate withand under the five mortality rate will decrease by one fifth compared with those in 2000 to 25.8‰ and Summit 31.8‰set respectively.the goals Thethat reduceUN the Millenniummaternal mortality by three 100,000quarters persons,to 22.2 and per under-five mortality rate by two Nations Special Session on Children held in 2002, it was proposed that by 2010, all three thirds to 20.3‰. At the United “mortality rates” should have decreased by one third compared with 35.3 those per 100,000 inpersons, 21.5‰ and 2000, 26.5‰ Compared respectively. with to the goals set in the above-mentioned programmes in China, the goals set by the UN have brought It is estimated that by 2040, the population over 60 years old China, accounting will for reach30% of 430 the total million population; and in the population over 65 years old will reach 320 million, accounting for 22% of the total population. Consequently, health and general welfare provision for the elderly must be incorporated into theinclusive social growth. agenda for Though China has made significant achievements30 years, itin has povertyalso experiencedalleviation a rural healthin crisis.Thethe allocationgap past in betweenhealthcare urbanresource and rural areas has become wider, the cost of whichmedical services for the migrant population. furtherThe current system for allocating increases healthcare services is no longer suitable for the balanced development of both urban and rural areas. People in poverty-stricken rural areas are victims of poor-quality food, due to asymmetric information and the widening income gap between urban and rural areas. This phenomenon is related to China’s public health safety policy, and also reflects the extreme vulnerability of poor groups. The World Health Organization (WHO) stated in a report in 2008 that “the possibility of decrease in income for any malnourished individual would be higher than 10% in his/ her life.” This indicates that lack of nutrition is interrelated with and affects low income or poverty. A survey A of the nutritional status of 1,324 children under six years old in poverty-stricken areas in the Guangxi Zhuang Autonomousretardation for children was 22.18%, a rate of low Regionbody weight of 28.17%, an emaciation showed that the raterate of of 11.12% and growthan anaemia rate of 16.19%. Among all the 12-month-old category had surveyedthe highest rates of growth children,retardation, low body weight, and the emaciation rate. These children take in less than necessary amounts of milk and meat and have limited their However, food relatively variety. high snack food intake resulted in is an important cause of child malnutrition. insufficient energy-protein intake, which The malnutrition rate for children in China decreased substantially during the 18 yearsfrom 1990 to 2008. However, the rate of growth retardation is presently about 14%, and nearly 20% in rural areas, which puts it at a level of intermediate severity. In poor rural areas, rates of growth retardation and low body weight for children under five years old are notably higher than those in ordinary rural and urban areas. Experts are calling for the inclusion of child nutrition indicators into the monitoring system for poverty reduction. We will put enhancing early-stage supplementary food and breast-feeding on an equal childhood development. anti-poverty strategies targeting early footing and work out Multi-dimensional Poverty Measurement and Targeting ONE mechanism Deficiency ineducational takes place where social stratification education isthefield Non-compulsory group HIV/AIDS vulnerable Migrant workersarea poverty the possibilityofchronic Chronic diseasesraise system isnotapanacea cooperative medical The newrural challenge tolivelihood become thebiggest impoverishment” has Disease-induced 42 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy Strengthening Health Work in Rural Areas Rural in Work Health Strengthening social development,especiallyforthedevelopmentofremoteandpoverty-strickenareas. and economic rural for hindrance serious a become has service medical of Inadequacy afford cannot high medicalfees. farmers poor importantly, More diseases). stubborn and serious of case the in (especially services those access cannot areas remote in farmers that so areas, stricken mountainous areas to see a doctor. Medical resources are concentrated in urban forward higher requirements and new challenges, which make them more difficult to to difficult more them make realize. which challenges, new and requirements higher forward fees, and educational loans and scholarships only provide “reverse incentive” in China China in incentive” “reverse provide only scholarships and loans educational and fees, tuition high as issues such monitoring and supervision in deficient are policies Education impoverishment andsocialstratification. related causes-education which education, higher affordthe can’t households poor many rural from students and the commercialization and internationalization of higher education in the new century,many prevent education education higher of enrolment enlarged With education. their continuing from households non-compulsory for fees tuition High compulsory education.Itisestimatedthattherearestill5million dropoutchildren. complete cannot who children school-aged many still are there China, western in areas or poverty-stricken In remains. reduced still education poor by caused impoverishment the fees removed, tuition with education compulsory for better become has situation the equality.educational on However,focus though a even been has there nation, the Within 3.3.2 Impoverishmentcausedbypooreducation addressed intheprocessofpovertyalleviationanddevelopmentnewstage. be to risk health key a is workers migrant society.in whole the prevention HIV Therefore, on burden heavy a be also will there HIV/AIDS of treatment and detecting in difficulty the heavily.Given suffer families their and workers migrant HIV,infected with infected Once related guidance. Therefore, migrantworkersarealargevulnerablepopulation. AIDS- and services medical to access insufficient have They prevention. HIV/AIDS of in awareness weak live a and conditions hygiene poor and with low-security, conditions quality poor resources, acquire to ability low low-incomes, have and skills, professional without educated poorly are provinces. They other in working workers migrant are million The number of migrant workers in China has exceeded 200 million thus far. Of those, 120 • Preventionof AIDS amongmigrantworkers the and (CCCPC) the in 2002 October China in requirement new of a announced Council State Party Communist the of Committee Central the Although groups. urban low-income and populations rural poor among phenomenon common a been has ill-health by caused Impoverishment • Healthandillness-inducedimpoverishment unless it is internalized, becomes chronic, the negative impacts cannot be eliminated eliminated be cannot within atleast20years. impacts negative the chronic, becomes internalized, is it poverty, persistent unless to lead necessarily not may that impact external of type a is Illness the rate, participation higher reimbursement ratewasquitelow.with areas project in Even areas. many in low remained had households farming poor of rate participation the 2007 by established”, gradually be that “a new rural cooperative medical system medical cooperative rural new “a that

Generally, it is difficult for farmers in poverty- in farmers for difficult is Generally,it Decision on Further Further on Decision

Multi-dimensional Poverty ONE Measurement and Targeting 43 The growth strategy basic overlooks people’s needs Falling back into poverty and vulnerability Though different discourses, China has the same development paradigm as the West Such a system has

Appendix One) of economic growth since Reform and Opening. Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Such a development path with economic growth as its goal has proven to be a Since failure. conditions, basic economic systems, and social and cultural situations differ from one country to another, efforts to realize developmentby dependingand povertyon the alleviationpower of simplyliberal markets often such services public goal, the as growth economic with development Under endexpectations. in market failure, contrary to as education and healthcare often put too much emphasis on basic needs. people’s efficiency and overlook The notion of Developmentalism, as developed in some western high-speedcountries, prioritizes economic growth. No one incan increasingdeny thatsocial economic wealth, growthbut thisplayssuperstructure doctrine a over role human of needs growthand environmental sees survival. economicIt constructs an growthideology growththat excludes policy options, since asthe doctrine of asgrowth has presumed that a policy options have been determined by market demands and economic growth. Nonetheless, in order to truly realize sustainableproblems developmentthat Western wecountries havehave experiencedto avoidduring theirthe development, such practice. “over exploitation” of natural resources, or the “pollution first, treatment later” as Throughout this process, it is not difficult to see that China has adopted a catch- up strategy (See • Development paradigm and path The Chinese Government has denied the so-called “Beijing emphasisConsensus” on and buildinghas put an all-around, “well-off” society.China Thoughhas adopted differentthe same development in paradigm discourse,as the West, especially since the period of reform and opening. This paradigm is paradigm. similar to the Western growth-based Domestic and foreign studies on poverty analyze internal and external causes, including factors such as the external environment, institutional factors, investment factors,social, cultural andand personal factors. Starting from the path of development, we explore of perspective the from China in poverty multidimensional fundamental of causes root the the economics of income redistribution. 3.3.4 The root of fundamental multidimensional poverty 3.3.4 The root of fundamental multidimensional Even families temporarily moving when outthey need of to paypoverty high medical feesare or tuitionquite fees for likely for vulnerable groups is higher. circumstances, the risk of impoverishment their children. toUnder such return poverty, Due to deficiencies in basic medical servicesdisadvantaged and in education,getting vocationalvulnerable training, groupsthus arethey relativelycan only lower obtain income.positions Increase with of family assets requirescomparatively stableincome earnings accumulationor cash andflows. Ordinary families often choosesome to sellpossessions off to pay for necessities of to sell can only live on loans. poor families that have no possessions lifeHowever, or services when funds are needed. 3.3.3 Slow increase in disadvantaged groups’ family possessions in disadvantaged groups’ 3.3.3 Slow increase which is completely opposite to the American system. In contrast to the American system, system, American the to contrast In system. American the to opposite completely is which vocational and higher vocational education is discouraged in China, while college degree education and post graduate education are given more resources. definitely increased the social cost of poverty alleviation for students of poor families, and such a system. they are unable to change Multi-dimensional Poverty Measurement and Targeting ONE 3 scientific criterion Regional targetinglacks Measurement Deficiency inPoverty Although some experts stressed that China should also adopt consumption standard to measure poverty, different local standards in China in standards local poverty,different measure to standard consumption adopt also should China that stressed experts some Although individual energy consumption rather than consumption poverty standards or unified standards for nationwide rural consumption poverty. consumption rural nationwide This paperadopts thestandardsofincomepoverty. for standards unified or standards poverty using consumption from than level rather income consumption and food energy on individual expenses the deduced has China Therefore, people. poor the for times consumption three food is which basic level on income expenses of means by U.S. the in poverty of definition the with compared levels living local from deduced are 44 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy to 592, what criteria are used? No public criterion was found, and it seems the criteria criteria the seems it and found, was criterion public No used? are criteria of what 592, to identification future for increases counties poverty of criterion number the when example specific For counties? poverty-stricken the is what areas”, “economic the poor of of perspective the development from residents rural of income net capita per the to If poverty-stricken counties are initially designated by the Ministry of Agriculture according the to due lack ofnon-incomestandardsinthepolicy. adequately monitored be and cannot effect resources utilization alleviation The poverty fields. of other efficiency in rights of deprivation) relative (or deprivation identify to difficult quite is it allocation, resource of process the During groups. poor and of accessthresholdvalueinthesystem. detailed are There ones. poor than studies in the United States on the deviation of funds caused by lack of detailed definition groups non-poor by more used being alleviation transfer poverty for funds through to lead can This groups. interest powerful of are hands the into fall they to likely made, distributed are group are minority a for payments alleviation transfer horizontal poverty when payments, for funds since critically, More trigger multidimensional povertycausedbylackofpublicgoodsandservices. undoubtedly will development of model U.S. a following simply services, public and infrastructure in investment vast the considering without Therefore, States. United the and China between income capita per and strength national comprehensive huge in gaps are There needs. basic afford cannot who groups poor relatively many are there education, and care health basic infrastructure, withadvanced States United the in Even earnings, multidimensionalpovertytakesplace. into their with goods transform private new these will afford cannot people goods When goods. private expensive public deficient, services public or needed when However, are goods satisfied. be public can needs basic people’s earnings, their with afford can are things the all people goods; that services and products adequate are there When public market. liberal a in included and private including money, with purchased be can that services and goods of basket a as to referred is well-being economics, Western In rule ofhistory. production to paid been has development the somehow violating thus stimulated; fully not is consumption and growth, attention greater however, Currently the reduction. poverty Though arranged. well rapid most the with was period the substantially.also increased is production This agricultural farmers for and incomes farmers’ nonetheless production, farmers’ in intervene not did distribution government income 1984, and 1979 between period the During individuals. by solved be naturally will problems other while intervention, government through optimized be only can distribution context, this In point. key the is distribution production–exchange–distribution–consumption, of process the In Historically in China, each dynasty in its rising stages focused on the issue of distribution. • Economicsofincomedistribution Though multidimensional poverty alleviation has been introduced into practical practical into introduced been has alleviation standard income single a operations, poverty multidimensional Though • PovertyreductionpracticesinChina 3 is still in use for targeting poverty-stricken areas areas poverty-stricken targeting for use in still is Multi-dimensional Poverty ONE Measurement and Targeting 45 Targeting of poverty Targeting village of poverty Targeting household It is too early to fully affirm the achievements gained in the whole- village based poverty alleviation has adopted multiple indicators for Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage China Poverty Monitoring Report In sum, multidimensional poverty is the root cause of many socialPoverty problems willin China.become increasingly multidimensional the inkey to the solving comingthe problem decade;of poverty therefore,lies in people-oriented solutionsresource allocations and and making monitoring accurately target to the causes of multidimensional poverty. The main problem is that poor people the cannotunfair benefitdistribution fromof socialeconomic welfare growthand the dueInadequate widening to provisiongap betweenof fundamentalrich welfareand poor. including nutrition and and employment results in emerging multidimensional poverty. health, education The system of “provincial governors vegetable be baskets”, which responsiblewas popular in the forpast, does not riceexist anymore. bags”With rising and inflation and much“mayors lower bank interest rates, the Engel’s Coefficient forfor poor households remains high even after substantial changes have taken place in the nationwideconsumption structure. In these basic households, income growth almost keeps pace with that of expenditure growth, making the wealth growth mechanism difficult to take shape for vulnerable households. Poverty alleviation in China has entered a Thoughnew some stagepositive of results tacklinghave been “hardcore”gained in thepoverty. village approach, of sustainability poverty reduction results needs to be provenpoverty alleviation, diversified demands dispersed limited funds, and specialized projects in the future. During the process areof separated from comprehensive regionalthus increasing strategiesthe cost of forspecialized economic projects. Furthermore,development,specialized povertyno alleviationone investmentknows will whetherchange the overall economic situation of a village. If clinical economics is used and funds are assumed to be the remedy to treat village-level poverty, then it is an open question that how much medicine is needed“cure” poverty. to monitoring. However, the results from monitoring are included in the income indicators poverty reduction. because there is no target of multidimensional Presently there is no systematic poverty monitoring for provinces, because of financial reasons and the lack of specific tools and standardsThe poverty. for measuring multidimensional The assumption of household level targeting is that poverty alleviation funds should go to the poorest households. these Yet are small groups in any village, and funds are easily to unclear means of monitoring and verification. withheld by opposing interest groups due Targeting the village level is presently line.conducted This standardaccording builds toupon theincome nationaldata from strawpoverty the and statisticalstalk which authorities,is difficult forincluding farmers to calculate, thus, theplace in first this deviationprocess. Since takesdifferent regions re-calculate the income levels of their own communities according to local price systems and consumption structures, there arises the second deviation. Thirdly, the number of poor is purposelypoverty alleviation funds from the state. Given that the approval agency dealing with poor increased to get more villages and lacks other staff means for verification, the third deviation would be sufficient alleviation funds. deviation in the distribution of poverty to cause significant for identifying poverty stricken counties are more subjective than objectively based. The relevant research reveals that some non-poor counties have in fact “wedged” themselves into the list of poverty-stricken ones in order to get more financial investmentgovernment. from the Multi-dimensional Poverty Measurement and Targeting ONE development economic andsocial together tothatof goal shouldbebound The povertyalleviation alleviation foralongtime multidimensional poverty a forerunnerof China hasbeen 46 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy Since the beginning of the 21 the of beginning the Since strategy disappearedwhenChinaenteredthestageofpursuingfasteconomicgrowth. on the basis of labor under the same initial conditions (primary distribution). However, this social in distribution priority upon based strategy given relief social a was adopted alleviation Poverty development. equality level, low relatively for a at services Though areas. education rural public vast and services medical preferential generalized provided Government Chinese the adopted, was strategy catch-up traditional a when period the In 3.4 China’s strategicdirectionforpovertyalleviation It is a dynamic and continuous process, without the so-called “dual” development development “dual” so-called the without agriculture by led structures lower-level from goes process, development economic that structure, continuous and dynamic a is It 4.1 Basisformultidimensional povertyalleviationstrategies Scheme inChina Implementation and Policies Poverty Multidimensional 4. and be based on the national medium and long-term goals for economic and social social and economic for goals long-term development. and medium national the measure, on and based operate be to and easy be should era The new precisely. the in operate indicators to alleviation harder poverty and random more monitoring and targeting poverty year.each changes it makes that This is line poverty income the for problem biggest The thereby realizingpovertyalleviationthroughtheprocessof development. development, and reduction poverty for offplatform society. common a establish will This well- a of construction the for goal development the to connected poverty be should alleviation multidimensional of goals the development, to social and population national economic rural the from the by benefit enable to set order goals In strategy. the to development long-term bundled & not medium is line” poverty “single-dimension The with alleviation poverty of route new a MDGs. be Chinese characteristicstobuildanall-aroundwell-off society. the will of 1970’s the and 1960’s attainment the in promote adopted will education and services strategies medical rural promoting of tradition the on building Furthermore, alleviation generalized poverty into and employment and preferential services education healthcare, social basic Integrating the in preferential be long-term. will cost the smaller the generalized provided, is in welfare such earlier used The infrastructures. is funds payment Transfer of “multidimensionalpoverty”hasnotbeenclearlydefinedatthepolicylevel. a in integrated concept the though has even alleviation, poverty of plans practice the into poverty multidimensional China that see alleviation can we poverty strategy this of From way. public participatory implementing bottom-up and emphasizes designing strategy the and alleviation poverty participation, whole-village the importantly, More and standards living improve to strives community environment,andpromotebalanceddevelopmentinpoverty-strickenareas. It and culture. and science of health development education, the technology, and and infrastructure development, of all-around construction and both emphasizes exploitation government integrated the to adhering Furthermore, highlights conditions. also production and living their improve populations, to poor and for problem subsistence the solve permanently to is strategy objective that The of strategy. alleviation poverty whole-village the adopted Central the has years Government recent in alleviation, poverty of understanding better a With growth. sustainable realizing and development, human promoting goals, development oriented st Century, the Chinese Government has set people- set has Government Chinese the Century, Multi-dimensional Poverty ONE Measurement and Targeting 47 Strategic goals Main tasks Multidimensional poverty Multidimensional alleviation prevents social ossification of strata Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 4.3 Implementation scheme for multidimensional poverty alleviation poverty multidimensional for scheme Implementation 4.3 We face a number of problems of poverty and deficiency in non-income dimensions that must be resolved in the process of building an all-round, well-off society. Standards multidimensional of poverty should be set align with the country’s development goals and objectives in the medium & long-term national development plans. (4) Establishing unified indicators to monitor performance of multidimensionalalleviation across the povertycountry, and at provincial level. Effectiveness of poverty reduction should one of the key indicators of performance assessment of local government. (3) Enhancing the vocational skills of poor peoplethem; and providing job opportunities to (2) Optimizing the allocation of educational resources in backward areas, and providing equal education to children in poor families; affordable (1) Enhancing basic medical and healthcare services and nutrition for children in poverty- stricken areas, and promoting urban-rural integration in healthcare; The main tasks of multidimensional poverty alleviation strategy are as follows: The main tasks of multidimensional poverty The overall goal of multidimensional poverty alleviation strategy is to improve the system of infrastructure and social services, and satisfy the basic living needs of poor More people. opportunities should be given to poor health peopleand nutrition, education and byemployment. Efforts will improvingalso be made to basicnarrow the conditions of urban-rural gap in basic living conditions and production. urban rural integration. increased in the process of sustainable People’s income should be Most of the poor population lives Accordingly, regional in approaches theof poverty alleviation ruralare concentrated areasin these areas of Central andand integratedWestern with China.other regional development policies, such as Development. the Initiatives Westernon multidimensional Regionpoverty reduction should integrate into the transformation in poverty-stricken areas. strategy on promoting social and economic 4.2 Multidimensional poverty alleviation strategies 4.2 Multidimensional National multidimensional poverty alleviation strategy associates with the overall strategy of social and economic development, guidedScientific by theDevelopment philosophy with of priorityhuman-centered ofis thelivelihood foundation ofimprovement. a harmonious Improvedsociety. Poverty livelihood and education. invigorating the country through science alleviation propels the strategy of This theory of developmentprocess. highlightsThese interrelations are thehighly interrelationscomplex and cannoteven in be emergencies. As suspendedeconomic during restructuring develops abruptly, in China, we theneed to search developmentfactors fundamental to China’s experience of poverty alleviation and develop a poverty alleviation framework that meets the requirements of the Scientific Development.framework This will prevent the stratification and society. foundation for the construction of a harmonious economic and social ossification of social groups and lay an to higher level ones led by secondary and tertiary industries. Developing country should not copy the development models of other countries. In different stages of development, upgrading of “software” and “hardware” of infrastructures and adjusting and controlling the efficiency of resource allocation through the for enterprises. externality and profits market will produce huge beneficial Multi-dimensional Poverty Measurement and Targeting ONE line multidimensional poverty Defining criterionfor line multidimensional poverty Basis fordefining 48 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy Development (2010-2020) Development poverty alleviation (single non-income dimension) is also applicable to the design of of design the to applicable also related projects( is dimension) non-income (single alleviation poverty specialized or departmental multidimensional for targeting deeper of principle with This priority. given areas be can the poverty poverty, income of calculation the average be and national level should the level referencing by national resources, limited average Given the areas. meet poverty identified cannot areas the all i.e. approach, level national-average- the following made be will programs and policies alleviation poverty development in different stages. In line with the 12 the economic with line and In stages. social different in for development goals development certain for set has Government environment Central The conducive more a development, education implementation ofthenationaldevelopmentstrategywillbecreated. in opinion public of supervision With level. provincial the to applicable also is principle same The education. county GDP.Any of in county "poverty-stricken" a as defined 4% is education GDPin its of 4% invest be cannot that education in input financial that requires government The poverty-stricken areas. This principlealsoappliestohealthcare. as supported be will level average national the poor,than lower indicators with areas and considered be will requirements these meet cannot will who Those laborers years. 13.5 to newly-employed increase for schooling of years of number average the and 40%; gross enrolment rate in senior high school education will reach 90% and higher education the popularized; be will education preschool 2020: by achieved be to goals development specific out sets Programme The people. the all to education equal offer to and areas, rural and urban covering education public basic of system service a of promote construction to the difficulties; financial with groups for support on and education, compulsory of development balanced the on emphasis put to people; the all to beneficial education educational reform and development. It sets the following strategic goals: to provide equal For example, the example, For in being as considered multidimensional povertyandeligibleforpolicysupport. be will level this below living Those reference. significant a as regarded be can level average national goals the future, foreseeable the within realized development be will national the Since people. poor as identifies be must Government Central the by set education and health of target the met not have who Primarily,those average. national the than higher have old years five provinces under children 12 of rates and malnutrition level medium level; average national the below are provinces 17 water, tap economically the using include residents rural of also ratio population the which of terms in Province; average, Guangdong advanced national the below age) schooling have at provinces 20 registered population average; the on based (calculated national students school the high of rates than graduation lower income capita per rural a regions have autonomous and municipalities provinces, Twenty average): national the than (lower indicators level lower with provinces in the dimensions show four 2 first Table The Table 3 National Programme for Mid-and Long-term Educational Reform and and Reform Educational Long-term Mid-and for Programme National ). takes “promoting equity” as an important guiding principle for principle guiding important an as equity” “promoting takes th Five-Year Plan, multidimensional multidimensional Plan, Five-Year Multi-dimensional Poverty ONE Measurement and Targeting

49 population

13

13.6 13.5 13.1 16.5 16.0 15.8 14.8 14.1 13.8 17.3 16.1 15.5 14.4 old to total total to old

The 65+ years years 65+ The

(%, 2008) (%, 1/ average Guangxi Hubei Shandong Shanghai Tianjin Jiangsu Liaoning Zhejiang Fujian Chongqing Sichuan Anhui Hunan

1 7 Guangdong, Shanghai, Jiangsu, Zhejiang, Tianjin, Heilongjiang and Jilin years old (%) old years

1.7

2.01 1.87 2.18 4.01 3.58 3.17 3.01 2.63 3.84 3.27 2.94 2.29 of kid under 5 5 under kid of

malnutrition malnutrition Medium Medium

average Hunan Gansu Guizhou Guangxi Xizang Hebei Qinghai Jiangxi Yuannan Hainan Xinjiang Henan 5 2 Shanxi, Chongqing, Shandong, Fujian and Liaoning residents (%) residents

62.0 62.9 65.8 67.3 62.3 64.5 61.6 67.8 68.4 43.7 49.1 55.0 55.0 58.7 44.0 55.0 56.1 60.3

to total rural rural total to

rural residents residents rural

use ratio of of ratio use

9 3 Qinghai, Shanxi, Xizang, Xinjiang, Ningxia, Hainan, Inner, ongolia, Jiangxi and Hebei Tap water water Tap average Liaoning Heilong-jiang Jilin Hubei Hunan Ningxia Yuannan Hainan Anhui Sichuan Henan Shaanxi Guizhou Inn.Mongolia Jiangxi Gansu Guangxi

77.6 68.8 63.2 65.2 66.3 60.1 69.0 73.3 64.7 73.5 75.8 35.0 48.3 52.6 52.6 59.4 62.4 45.2 51.7 54.8 59.7

graduates 7 Gansu, Guizhou, Yunnan, Sichuan, Anhui, Henan and Hubei 4

school school % of high high of % average Hunan Sichuan Xizang Guangxi Yuannan Fujian Guangdong Shandong Hubei Shaanxi Qinghai Xinjiang Guizhou Gansu Shanxi Hebei Ningxia Henan Inn. Mongolia Anhui

2 Guangxi, Hunan 5 Results with the category of elderly people added:

(CNY)

5153.2 4909.0 4937.8 4478.4 4504.3 4744.4 4807.0 4244.1 5035.3 5075.0 5149.7 2980.1 3346.2 3437.6 3531.7 3980.4 4462.1 3005.4 3369.3 3883.1 4048.3

residents residents

Table 3. Illustration of Multidimensional poverty by provinces (data: 2009) by provinces (data: poverty 3. Illustration of Multidimensional Table of income Net rural rural Net Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage

average

Hunan Inn. Mongolia Chongqing Anhui Hainan Henan Shanxi Hubei Jiangxi Hebei Gansu Sichuan Qinghai Shaanxi Xizang Guangxi Guizhou Yuannan Xinjiang Ningxia Dimensions involved Dimensions 4 3 1 3 3 4 2 3 3 3 4 3 3 3 3 4 4 4 3 3 years old /(population between 15-64 years old) ×100%. No data available on tap water in Tibet. Tibet. in years old /(population between 15-64 years old) ×100%. No data available on tap water House of Beijing Union Medical University) Source: calculated based on data from the 2010 China Health Statistical Yearbook (Ministry of Health, 2010. Publishing 1 3 5 6 8 2 4 7 9 No. of provincial areas (30) Detailed provincial areas Dimensions involved 11 16 17 12 13 14 15 10 18 19 20 No. 1/ note: data for the dependent ratio of aged was 2008 data. The dependent ratio of aged = population equal or above 65 Multi-dimensional Poverty Measurement and Targeting ONE poverty-stricken groups multidimensional Determination of alleviation multidimensional poverty preferential strategiesfor “Balanced” generalized strategy poverty alleviation Changing “exploitative” 50 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy is thepromotionofawarenessmultidimensionalpoverty. alleviation practices. Without doubt, the key to solving multidimensional poverty problems poverty multidimensional in innovation and policies, and strategies poverty of adjustment the through mechanisms growth inclusive of society poverty,establishment multidimensional all on by recognition the on depends perspective inclusive more a frome poor the existing current China, on by in faced poverty multidimensional the solve alleviation to How standard. income-based based the poverty beyond of future the situation for vision broader poverty a provides data statistical multidimensional the of analysis The five the of some by affected be all would dimensions. China of 1 mainland well-being of and the 3,2 provinces Beijng, 30 by except other way, the this affected In be respectively. would 7 and that 5 9, are provinces of dimensions number The alleviation. poverty 4 multidimensional to relation in provinces key the as considered by be will which dimensions, affected be would provinces 7 whole; a as planned be should rich” getting before changed: is “aging of issue the dimensions, result five all by affected the be will provinces Hunan then and Guangxi poverty, of dimension one (a as ageing of considered is challenge risk) the potential facing for readiness of lack namely, population considered, elderly further the is of issue the regarding provinces various of preparedness the If provincial area,Chongqing,isaffected byonedimensionoflowincome. one only and dimensions 2 by affected are provinces simultaneously,2 dimensions 3 by affected are 11provinces Meanwhile, targeting. poverty for provinces key as taken be to This indicates that theseprovinces are broadly affected bypoverty dimensions, andneed Hunan. and Henan Guangxi, Yunnan,Guizhou, Gansu, are: these average; national the with compared backward, as defined dimensions remaining four all have provinces Six the country should be thoroughly investigated according to the standard of national national of standard the to according investigated thoroughly be should country the across employment and education healthcare, as fields such in poverty basis, scientific lacks counties poverty-stricken national 592 the of designation the As (NBS). Statistics of Bureau National the by atlas poverty a of completion the for waiting is currently public How many people are poverty-stricken across the country and where are they living? The (2) Thorough investigationofthestatusmultidimensionalpovertyacrossChina “balanced” regionaldevelopment. as alleviation poverty multidimensional define to better is regional it consideration into the implication Taking level. policy the at and strategies "protective" preferential to generalized change "supportive" will strategies alleviation poverty multidimensional Future natural environment,andonthebasiclivingsecurityof people. the protecting on focus will strategies alleviation poverty new development, of core the at the with combined strategy livelihoods With relocation. migrant protection ecological of means by alleviation poverty of process ecological an ecological an adopted has constructing of China era new a civilization, In West. the by up given been long has and example, sustainability ecological For neglects that West. measure a the is resources from natural of exploitation the criticism particular to exploitation” subjected of been way has by concept This significance. meaningful alleviation no has now “poverty development, economic regional phrase from the originating in “exploitation” word The (1) Changesinpovertyalleviationstrategies 4.4.1 Short-termproposals(onetothreeyears) 4.4 Policyrecommendationsandimplementation Multi-dimensional Poverty ONE Measurement and Targeting 51 Nutrition and health Education Employment Leading the subjects of poverty alleviation to put resources into health care, education and employment nationwide a Establishing monitoring and evaluating agency for multidimensional poverty Experiment and pilots Experiment and Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage According to the strategic tasks of multidimensional poverty alleviation in the new period, indicators and monitoring methods for poverty alleviation in various fields should be A A complete system is needed to guarantee and realize multidimensionalmonitoring andpoverty. Theevaluation members for of the State Council Leading GroupPoverty AlleviationOffice of and Development (LGOP) should establish a groupand evaluation. for monitoring (5) Establishing a monitoring and evaluating system for multidimensional poverty The Central Government will giveThese stakeholders guidancewill voluntarily participate in the to fields ofparticipation healthcare, education and of Available employment; resources will be povertyallocated into the weakest indispensable points alleviation. linking with people's livelihoods such as health, nutrition and education. (4) Guidance for participation of Stakeholders in multidimensional poverty alleviation Standardized monitoring and evaluationbased on iscommunity needs,made population forand employmentemployment characteristics, the trainingoutgoing status employment and of local coursesdevelopment in agriculture. Experiences in training and poverty-stricken groups. employment are summarized for different The efforts should be made to narrow the regional gap of education between rural areas and nearby cities comparing with the national average level. Through this comparison, needed budgets can be calculated in the educational field for narrowing the gap. In the affordability by comparing be measured poverty can of degree the project, pilot education and non-compulsory education. by household between compulsory education In terms of nutrition and the basic 7” under Children for healthcareIndicators “Growth on based communities in of explored be will children,children the main issues relevant to women by suffered disease of severity and types The Health. of Ministry the by published and relevant measures regarding the prevention of endemic referringdisease will beto exploredindicators of maternal goals mortalityof rural multidimensional poverty alleviation inshould be set Millenniumin line with the relevant Development Goals.medium & Thelong-term development goals of the country. The urban nutrition and healthservice level should be taken as a medium-term goal based on practical conditions and of urban and rural medical systems. make preparation for future integration As for the above three selectedfields, across the country poverty-strickenfor pilot projects. Good practices in townshipsthe disseminated pilotin other areas poverty-stricken areas. will The orbe following methods communitiesshould be focused will on during the piloting process: be Basic necessities of life are generally consideredmeans of to travel.be food,Since theclothing, urban-rural housing, gap andin housinghousing constructionconditions has widenedcannot and be measured withChina, the issue of housing is not included in this areport. In the short term, basic nutrition unified standard in the vast is area regardedof as a fundamental issue of healthcare,multidimensional educationpoverty, and andfields employmentsuch as multidimensional poverty. need to be evaluated as core concerns of (3) Pilots in multidimensional poverty alleviation strategy multidimensional (3) Pilots in economic and social development, and the social and economic features of population from the sixth census in 2010. This will establish population. of the nationwide poverty-stricken and management distribution a relatively complete file about the Multi-dimensional Poverty Measurement and Targeting ONE 4 support Importance oftechnical Stably promote the development of Chengdu-Chongqing, Guanzhong-Tianshui and Guangxi Beibu Gulf economic zones, support the the support zones, economic Gulf Beibu Guangxi and Guanzhong-Tianshui Chengdu-Chongqing, of development the promote Stably and leading role for surrounding areas. –extracted from the speech by premier Wenjiabao at the working conference on the Strategic Strategic the on conference working the at Wenjiabao premier by speech the Development of Western China. from –extracted areas. surrounding for role leading and radiating with highland strategic new forming thus Tibet,in rivers Lancangjiang” and Sequ Zhaqu, “Angqu, of areas the and and Ningxia in river Golmud Xining, Lanzhou, mountain, Tianshan of slope north Shaanxi-Gansu-Ningxia, foster economiczonesincluding middle Yinchuan, Yunnan, middle Guizhou, upperreaches of Xijiangriver, areas along YellowBaotou, Hohhot, as zones economic such of development 52 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy Technical and professional advantages need to be fully utilized for targeting at the the at targeting goals, for development national on based utilized selected be fully will targeting be Such level. to community need advantages professional and Technical populations small develop slowly. with areas minority ethnic many factors, other and barrier language 5) The ethnicminorityareaswithemploymentchallenges:Due to deficiency of education, which canhardlyrealizetargetswithoutexternalsupport. areas Educational related include for and China, Western Programme to the limited in not are set areas Such goals Development: the achieving in difficulty with Areas 4) the Southwestregion,therapyareaforprairieechinococcosis,etc. disease: endemic and infectious of areas Connected 3) disconnections betweeneconomicdevelopmentandpovertyreduction. regional previous the avoid to zone economic the of areas surrounding the in conducted the western economic zone economic western the constructing of process in the In poverty Zone: Economic Development Westernmultidimensional the for to relation area targeting corresponding the of Determination 2) Qinbashan-Liupanshan the and Yunnan western of mountain area. the border area, the mountain on Wumeng area the area, mountain mountain Wuling the edge Plateau, eastern the Tibetan the Xinjiang, of of region southern the including, China; Western of areas China: Western of Development Strategic the in alleviation poverty multidimensional for regions Key 1) is targeting defined, are group andthenationaldevelopmentstrategy. groups and goals poverty-stricken poverty multidimensional the of number the to according level regional the at redefine undertaken After development to national criteria. needed the are with multidimensional definitions accordance in New counties period. new the poverty-stricken in alleviation poverty of requirements the meet all not counties will counties growth” “economic of basis poverty-stricken the on Those defined poverty-stricken previously Government. the Central to the by confined defined been not have is that poverty multidimensional Current areas withmultidimensionalpoverty. and regions the target to formed be should team technical multidisciplinary specialized and of health Atargeting. of on investigations design leading fields the from the The data in baseline with along education, support. professionals of technical participation active strong requires and targeting the discipline rigorous demands poverty multidimensional of poverty,monitor income monitoring for used datum rough the Unlike (6) Targeting multidimensionalpoverty relevant suggestionsatmacrolevel. propose and level, micro a from lessons and experiences evaluate to us allow will This needed. also is alleviation poverty for funds of utilization of effectiveness of Assessment Accordingly. projects. alleviation poverty the projects of effectiveness poverty the evaluate to needed multidimensional is of evaluation and monitoring Regular established. Key regions for poverty alleviation and development are the connected the are development and alleviation poverty for regions Key 4 work on multidimensional poverty alleviation will be be will alleviation poverty multidimensional on work The tuberculosis therapy area in area therapy tuberculosis The Multi-dimensional Poverty ONE Measurement and Targeting 53 Targeting on the Targeting level community the poor Targeting household study Multi-disciplinary Indicators are tools for targeting care medical on Focusing and health during the Plan Five-Year Twelfth Gradual expansion on the coverage of multidimensional poverty during the Thirteenth Plan Five-Year Strengthening the role of comprehensive coordination Five-Year th five-year plan. th Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage and their application; construction and poverty reduction projects; Improving the monitoring system for multidimensional poverty; Further promotion for international cooperation. Promotion of researches on multidimensional poverty alleviation, relevant indicators Comprehensive coordination of the efforts of different ministries in new countryside • • • • Multidimensional poverty alleviation requires spreadingpositive cultural professionalinfluences. In theknowledge field of development,and research on relations between Prioritization and sequence of development in multidimensionalvery povertyimportant. alleviationUnder iscurrent living conditions, basic problems thereof medical care, education and employment. Medical care and education is an urgent need to solve the development in the 12 priorities will be combined with regional (1) Gradual expansion in the field of multidimensional poverty alleviation (1) Gradual expansion in the field of multidimensional 4.4.2 Medium & long-term proposals Although selection of indicators becomes a technical issue after in settingmultidimensional poverty policyreduction, it targetsis an indispensable link and a tool for targeting poverty-stricken groups. The government issued the Medium and Long Education Term Development Plan 2011-2020, and the similar plan in health sector studies, pilot is projects also in stipulated,these fields can be conducted. Subjective indicators in poverty should be avoided. and the incomparability of regional indicators Poverty studies conducted in the arefields mostly offocused healthon income care,and expenditure.education Research strategicand on goals theemployment is gapinadequate, inwhich requiresthe participationnational of different departments and cooperation of various disciplines. (7) Studies on indicators for multidimensional poverty (7) Studies on indicators Targeting Targeting the household level should respect public opinion, especially the opinions of poor groups. In accordance with the development goals in medical care, education and employment, villagers will be invited to participate in discussions,groups will be definedto as poor indetermine which dimensions, so thatwhichdemocratic decision-making and supervision can be strengthened. This can encourage governments to conduct wide avoid arbitrary plans. working out development plans, to ranging research when the locally applicable goals for multidimensional poverty alleviation and rigorous scientific standards. With the reform of the education and medical systems, the level. at community will be taken into account livelihoods factors concerning most important The role of Leading Group Office of Alleviation Poverty (LGOP) should be strengthened. It should carry out the following roles: (2) Strengthening the role of poverty alleviation agencies Plan. With establishment of integrated medical care urban-ruralsystem gapin willurban be and graduallyrural narrowedareas, in the systemhealth acrossservice. urban Integratedand rural employmentareas will promote labor dimensionsmobility. On relatedthis to basis, multidimensionalother poverty such as controlhousing, preventionof HIV/AIDS,and the and povertyincluded in alleviationthe framework for poverty alleviation forduring the period physicallyof the 13 disabled people will be Multi-dimensional Poverty Measurement and Targeting ONE cooperation Key fieldsfor alleviation multidimensional poverty An arduoustaskfor alleviation multidimensional poverty atmosphere for Create acultural 54 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy for thepoor, givingthemconfidencetobreakviciouscircleofpoverty. necessities living basic provide will education and care health of fields the in alleviation Poverty report). this in discussed not are dimensions cultural and political the in factors the (though development coordinated for atmosphere cultural a create to and alleviation poverty multidimensional of understanding promote to indispensable is it regard, this In dreams cometrue. their make will efforts and belief Their structures. social and economic of transformation the and prosperity common on society, based affluent all-around, an build and behavior belief in the principle of people-oriented development encourages citizens to change their Actually, people's beliefs are the main factors that leadto behavioral change. Specifically, they neglectthesocialandculturalattributesofhumanbeingssociety. growth, input. to labor contributions as human simply studying beings when human Thus, regarding growth,” “economic of perspective the from more resources human of function the explore Economists marginalized. been has development and education care, health The keyfieldsinwhichfutureinternationalcommunitiescanparticipateinclude: sense, itcanstillreceiveassistancefrommanyinternationalorganizations. real the in country middle-income a is it Though shift. this undergone has that country a of may example good a community provides Africa South accordingly. international China toward The attitude its capita. change per income by measured poverty the from different is China poverty, in multidimensional poverty of of definition scope the the Using information, in support seek and alleviation knowledge andfunding. poverty for with cooperate organizations Facing actively to has international cooperation. China conditions, international international broad and step. needs domestic by and complex step task country tough the a in is it poverty will absolute Undoubtedly, role leading eliminate policies a and play MDGs must the alleviation China achieving in cooperation. poverty international wider attract multidimensional undoubtedly China's of implementation The 4.4.3 Keyfieldsforfutureinternationalcooperation • • • • Assistance in establishing a rural monitoring system for multidimensional poverty in poverty multidimensional for system monitoring rural a establishing in Assistance Promoting the spread of ideas for “balanced” multidimensional poverty alleviation in alleviation poverty multidimensional “balanced” for ideas of spread the Promoting Research on the system of policies and indicators for multidimensional poverty in in poverty multidimensional for indicators and policies of system the on Research China; multidimensional povertyinChina; China; China. Promoting international co-operation in studies and discussions on practices of of practices on discussions and studies in co-operation international Promoting Multi-dimensional Poverty ONE Measurement and Targeting 55 period (2001-) Catch-up strategy in the new Catch-up strategy People-oriented, promoting People-oriented, promoting and human development growth realizing sustainable Sustainable development, and ecological construction environmentally-friendly development “Theory of common prosperity” Coordinated urban-rural development, narrowing urban- rural gap Coordinated development of eastern, central and western regions Coordinated economic and social development balance between efficiency A and paying more and equity, attention to social equity (redistribution, priority on equity of public services, priority to social harmony) Gradual understanding of which multidimensional poverty, has more dimensions than a simple poverty line of income 1. Poverty alleviation is not only to provide enough food and clothing for poor population, but also to improve their living and production conditions permanently Adhering to balanced 2. development and putting emphasis on both infrastructure construction and development of sciences and technology, education, health and culture; 3. Putting emphasis on participation by people, working out and implementing poverty alleviation plans in a bottom-up participatory way. period (1979-2000) Catch-up strategy in transitional in transitional Catch-up strategy Pursuit for high economic Pursuit for high economic by 2000 growth. Doubling GDP Pollution first and treatment a worsening ecological later, deficit “Theory of earlier prosperity” Limited urban development, widening urban-rural gap Limited development in coastal areas, with regional gap being narrowed first, then widened Priority on economic development Priority on efficiency and taking equity into consideration Poverty was defined as lacking basic capabilities of living and having low income Regional poverty alleviation and development, regional targeting and designating poverty- stricken counties from 1986; encouraging poverty alleviation in the form of export of labor services; aids from multiple departments; participation by the whole society; promoting poverty alleviation on village- and household-level; going on solving the problem of food and clothing for poor population Traditional catch-up Traditional strategy (1949-1978) Pursuit of high speed Pursuit of high speed of development and catch–up. Realizing the “Four Modernizations” by 2000 exploitation Vigorous of resources, leading to waste of resources, damaged ecology Egalitarianism Priority on urban development, partition of urban and rural system Limited development in inner land, widening regional gap Paying attention to social development Priority on equity Getting rich by honest work; respecting the aged and loving the young; aiding those in poverty or in peril Generalized preferential public medical services and education, full employment, distribution on the and basis of labor, social relief - Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Development goal Relationship between human beings and nature Relationship be tween income and distribution Urban-rural relationship Interregional relationship Economic and social development Equity and efficiency Understanding of poverty Poverty alleviation strategies Appendix One: Understanding of strategies for poverty alleviation China periods in different in Multi-dimensional Poverty Measurement and Targeting ONE 56 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy measure areasofmulti-dimensionalpoverty. to indicators specific of use and development the through approach multidimensional the 2 *Nutrition:Ifanyadultorchildinthefamilyismalnourished; *ChildMortality:Ifanychildinthefamilyhasdied; 1. their with weighting, areasfollows: indicators, and dimensions These poverty. individual than rather household, measures MPI The areas. their of each in data available and assessments participatory on based are MPI the in indicators The indicators. ten These using living. measured are of dimensions standard and education health, dimensions: three has MPI the OPHI, by devised As areas. of range a in deprived” “multiply as poverty in living those defines MPI poverty,the multidimensional assessing for methods most in case the been has As programmes. and policies reduction poverty for relevance its and Index new this discussing on focused Index Poverty poverty–the multidimensional measuring to approach new a developed In the United Kingdom, the Oxford Poverty and Human Development Initiative (OPHI) has the developmentofindicatorsforpossibleuseinChinesecontext. for below,relevance summarised with indicators. is studies of This case to reference with design the on undertaken been has poverty,work multidimensional and of measurement the in developments important internationally,been years, have two there last the During Recent DevelopmentsinMeasuringMultidimensionalPoverty of areas remaining poverty, the both emerging newly and poverty address to but China, in programmes reduction poverty and assessments poverty in time some for use in been have approaches Multidimensional being”. well- economic and tolerance economic capabilities, “individual of dimensions China. three the in reduction poverty the in for notably poverty, multidimensional policies future within the of aim it) specific more A of aspects (or it adopt to Poverty on Report the of aim overall The Case and Experiences Studies International Two: Appendix * Assets: If the household does not own more than one of: radio, telephone, bike, telephone, radio, of: one than more own not does household the If Assets: * *CookingFuel:Ifahousehold cookswithwood,charcoalordung; *Flooring:Iftheflooris dirt,sandordung; *Sanitation:Ifthisdoes notmeetMDGrequirements,orifthetoiletisshared; Millennium relevant the of requirements the meet not does this Water: It Drinking * *Electricity:Ifthehouseholddoesnothaveelectricity; 3. *Children’s enrolment: Ifanyschool-agedchildisoutofschoolinyears1-8; * Years ofSchooling:Ifnohouseholdmemberhascompleted5yearsschool; . Health Education Living Standards motorbike; walk; minutes 30 than more requires water to access if or (MDG), Goal Development is to clarify the concept of multidimensional poverty, examining if it is possible possible is it if examining poverty, multidimensional of concept the clarify to is (each indicatorweightedequallyat1/6) (each indicatorweightedequallyat1/6) (MPI). Almost all recent discussions on multidimensional poverty have have poverty multidimensional on discussions recent all Almost (MPI). Report The Measurement and Targeting of Multidimensional Multidimensional of Targeting and Measurement The is to develop indicators for measuring areas of of areas measuring for indicators develop to is Report’s Report argues that it is necessary to formalise to necessary is it that argues tabulation of appropriate indicators in in indicators appropriate of tabulation Multidimensional Multi-dimensional Poverty ONE Measurement and Targeting 57 Report stresses the -or percentage of households The latter estimate aims to show . Headcount of Deprivation Average Average Intensity Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage The The Measurement and targeting of Multidimensional Poverty Report Relevance of MPI for the contemporary Chinese context importance of targetingenvironmentally remaining fragile areas). areasIt also highlightsof the from areas, urban to migration from resulting example, (for poverty of forms emerging therural importance povertyof addressing newly(in impact remote,of climate change), and improving hardcore,specific policy implementation (in areas such as the co-operative medical insurance scheme). In all these areas, using the indicators particular of impact the assess and understand to us enable would MPI the in forward put forms of deprivation experienced by differentwill also groupsenable us to in target differentthe needs of poor regions.households more efficiently. The Doing thissuggests a it set appears of that indicators. the However, indicators presented in the MPI are more comprehensive, and might provide a means for established understanding aof different types moreof poverty detailedin China than currently is the case. Certainly, it is worthwhile policy-makers examiningrelevance for the Chinese context. the recently developed MPI, to assess its One of the most useful ways in which the MPI could be used in China use in might identifying be “types” of via multidimensional The poverty. its MPI can be “decomposed” by population sub-group (by ethnic group, for example), or by area. This has already been done in a number of countries, such as Bolivia, Kenya and revealedIndia. Thesestriking studies differenceshave within each country. For example, whilst in the the MPI casein Nairobiof Kenya,compares favorably with countries with low rural percentages,northeast thehas an MPI similar to that of the poorest Sub-SaharanNiger. African In country, Bolivia, within the country headcountconclusions have been povertyreached in India, with rangesa state such fromas Kerala at 27-46%.14%, compared Similar with Bihar at 81% and Jharkand at 77%. We can thus identify areas of regional poverty. Examining the findings from using the indicatorsto inidentify these typesareas, of we multidimensionalcan them beginpoverty to withinsuggest thesespecific areas.local Thisstrategies canfor enableaddressing us thesesome differentareas it types may of be poverty. the In case that educational deprivations, or deprivationsthat households score are lowest greaterin areas such than as healthinadequate flooring and cooking facilities. Similarly, the MPI can also be used to evaluate progress over time in particular areas of poverty reduction, charting changes both in the numbers inand the intensity of poverty regionally. poverty Using the MPI produces two estimates: The who and are the poor, the number of dimensions in which the household is deprived. In this way, the MPI can be used as an analytical tool to identify the most vulnerable households, indicating not only those areas in which they are deprived, but also the interconnections between their deprivations. This enables policy makers to target resources and design policies moreeffectively. The MPI defines a household as “multidimensional poor” if-anddeprived only in if-it a is combination of indicators whose sumThe intensityexceeds of 30%poverty measureof is all particularly deprivations.important, internationally. For example, using this measure indicates that poverty previouslyis moreestimated. prevalent Using in the SouthMPI Asiareveals thanthat poor people contains nearly twice as many multidimensional The region levels of poverty. was South Asia has the world’s highest than in the next poorest region, Africa. Sub-Saharan The latter region, has however, the highest MPI poverty rates. Using the MPI, China currently has 7% of its population living in poverty (Compared, for example with India at and Brazil, 55%,8.5%). Using the MPI indicators Pakistanreveals that the highest contributor to overall 51%, Indonesia 21% poverty in China is deprivation in education. Use of the Multidimensional Poverty Index Multidimensional Use of the Multi-dimensional Poverty Measurement and Targeting ONE 58 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy importance for households than other areas, and we need to take this into account in in account into this making judgmentsontherelevanceandweightingofelementsacompositeindex. take to need we and areas, other than households for importance not or floor, that–for sand a on notion living the to having a television, telephone, or car.equivalent Clearly, accepting some areas of deprivation will have greater somehow is involves child a of indices death the example-the of weighting are which The MPI, the in implicit questionable. judgments value the on centres criticism telling more A such to vulnerable households impacts. by experienced poverty of types the of detailed a understanding enabled have would MPI the of use pre-crisis a that respond well could one Although responses. and assessments rapid of require example) for regions landslides, in floods, of MPI form the the (in of households poor use on change climate of possible impact the by the of aspects for where China, issue economy-either an global is the This in regionally. crisis or economic country 2008-9 the of impact households the poor assessing in on useful very been have not would it example, For a fluctuations. As situation. a such in useful economic and social to responsive be very not is MPI the to concluded, have critics of number notably unlikely MPI–most the indicators-are in standard” indicators “living the six of the Many change. into poor fall such to of on likely result are a change as household of poverty induced types what climate and of many how impact estimating the households, short-term assessing to in respond to example, need often change–for makers policy conditions, poverty assessing In however, thisshouldnotbeamajorproblemforitsuse. indicators, the of most for data Chinese of availability the Given purposes. comparative for Index the of use the on constraint serious a as countries many in availability data of lack the emphasized have critics Several relevance. its also assessing are in these considering and worth MPI, the of made been have criticisms of number a recently, Most Criticisms oftheMultidimensionalPovertyIndex 9. Santos, M.E., and Ura, K. (2008) “Multidimensional Poverty in Bhutan: Estimates and Estimates Bhutan: in Poverty “Multidimensional (2008) K. Ura, and M.E., Santos, 9. Senegal: in Poverty A“Multidimensional (2005) al. Non-monetary et S., Faye., J.B., Ki, 8. 7. Decanq,K., andLugo.M.A. (2010),“Weights inmultidimensionalindicesofwell-being: Policy Bank World Poverty”, Relative “Weakly (2009). M., Ravallion, and S., Chen, 6. multidimensional of measurement “The (2003), S.R. Chakravaty,F. And Bourguinon, 5. in Changes “Decomposing (2009). G. Yalonetzky, J.P., Ocampo, M, Apablaza, 4. India: in Measures BPL and Poverty “Multidimensional (2008), s. Seth, and S, Alkire, 3. for Index Hew APoverty: Multidimensional Acute (2010). M.E. Santos, and S, Alkire, 2. a countries: developing in poverty “Multidimensional (2010). K. Eli, and S Alkire, 1. Multidimensional Poverty of Measurement the in Developments Recent on Readings Selected Development, Oxford. International of Department Oxford No.14, Paper, Working OPHI Implications”, Policy Basic Needs Approach”, PMMA Working Paper2005-05. An overview, CESDiscussionPaper, 10.06,KatholiekeUnivesiteit Leuven,Belgium. Research Working PaperSeries.,World Bank,Washington D.C. poverty”, JournalofEconomicInequality, 1(2003),5-49. Development, Oxford. International of Deparment Oxford OPHI, Countries”, 10 in Poverty Multidimensional of Department Oxfotd no.15, Paper Working International Development,Oxford. OPHI Methods”, of Comparison A of Department Oxford OPHI. no.38, International Development.Oxford. Paper Working OPHI Countries”, Developing Development Initiative(OPHI),OxfordDepartmentofInternationalDevelopment. data”, international existing using measure mimeo , Oxford Poverty and Human Human and Poverty Oxford , Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era” 59 The institutional arrangement of extracting surplus from agriculture, rural areas and peasants in the period of primitive accumulation for China’s industrialization became the main cause of rural poverty . Only when capital is no longer a 5 ) became the main factor causing widespread San Nong Rural Governance and Poverty Alleviation in the in Alleviation and Poverty Governance Rural Era” Tax Agricultural “Post

the official institutional arrangement by the government for providing Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage TWO Jiansheng, International Conference on Crossroads, June 17, 2010, Lingnan University, Hong Kong. Jiansheng, International Conference on Crossroads, June 17, 2010, Lingnan University, “Ecological Civilization, Indigenous Culture and Rural Reconstruction in China”, by Wen Tiejun, Lau Kinchi, Liu Xiangbo, He Huili, Qiu Since reform and opening up, China’s rural development has drawn worldwide attention poverty in rural China. 5 1. Rural Disadvantaged Groups: Alleviation Initiatives Poverty A Key Target of New In the period ofindustrialization, the inevitable primitive accumulation of capital for national urban industry with massive surplus from agriculture,(known as the three rural issues, rural areas and the peasantry A A universal problem with anti-poverty under the market economy systemregular occurrence, governments isof developing countries that:or impoverished regions as in the a world generally aim for economic growth. However under pressure of extreme scarcity of capital and of building high-cost modern superstructures by imitatinginevitably the leadWest, willto an increase in government debt,intrinsically oriented theytoward a are “pro-capital” policy almost all inevitably and This section does not aim to analyze external macro-environment and governance but rather the impact of rural governance at village level. The report provides analysis an on objective the premise of recognition with the generally beneficial antipoverty strategy and policy the government strives to promote. Important changes have taken place in recent years; that is, after capital was no longer of policy the 1990s, late the in fore”) the to came already “overcapacity” even (and scarce poverty alleviation was adjusted accordingly to a generally beneficial “integrated village development project (IVDP)” and an internationally accepted policy “aiming at poverty- stricken groups”. In implementation, however, policy inertia (or “path dependence”) the of earlier industry-based poverty alleviation alleviation still persists. and rich household-stimulated poverty For many years, China was a developing country with the largest poor population, and economic growth was a main development goal. Rural China at large before the 1980s’ reform was immiserized, the root cause of which was that in the primitive accumulation stage of early industrial capital formation, over RMB600-800 billion of economic surplus was extracted from the rural sector (Yan Ruizhen 2009). etGovernment debtal., in 1990;that period Kongwas excessively Xiangzhihigh (Wen etTiejun, 1999). al.,Even in the initial stage of reform, the government’s antipoverty strategy was “creating growth poles” and “industry-based poverty alleviation,” still reflective that of the thegovernment attempted policyto create orientationindustrial capital in impoverished areas where capital was extremely scarce. scarce factor and the reduction in pressure from government debt is an objective external external objective an is debt government from pressure in reduction the and factor scarce condition, are they likely to truly carry out a intrinsic causes explaining “pro-poor”why it is hard for most developing countries to truly implement policy. This is also one of the Development Goals (MDGs)” effectively. “Millennium UN’s Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” TWO 7 6 Datasource:Calculated basedondataprovided in foreign the alone, 1993 in deficit; trade foreign a registered again once China 1993, to 1992 of half second the from year one than more In 1993 was$12.220billion).Datasource: in deficit trade foreign (the alone year the of imports net pay to enough not was billion $7.653 remaining the billion, $13.546 debts, floating of and reserve balance then exchange the of billion. deduction $21.199 After some at foreign stood reserves exchange foreign China’sChina’s 1993, of end systems. the payment At to challenge a posed deficit trade foreign increased suddenly The billion. RMB70 was deficit trade 60 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy China Statistical Yearbooks. Statistical China and urbanareasinreturntosupportagricultureruralareas.” industry need we industrialization of stage medium the in industrialization; of stage early the in sectors urban supported areas rural the and industry indicated supported also “Agriculture that leadership central The 2009). He and (Kong 1949 in China of Republic have contributed RMB17.3trillionto citiesandindustrysincethefounding of the People’s peasantry the high and of areas rural agriculture, pressure researchers by under estimates to According debts. country developing common a of behavior government the of characteristics had period this in strategy antipoverty China’s that clear thus is It income. cash of pursuit in origin, of places their outside jobs seeking towards areas, developed less- in mainly force, labor rural the among emerged trend a growth, income slower a with along reduced be to unable was expenditure mention cash farmers’ of rigidity to the as period, not same teachers, the In and households. poor targeting soldiers directly spending officials, alleviation poverty of increasing salaries the pay to difficult was it reform of decentralization and giving up profits to enterprises left government finance finance 12.6% only government to left down enterprises to profits up giving and decentralization of reform The 1994. in inflation generalized and CPI 24.1% a to rise gave directly response a as supply money in increase consequent due The the 100%. over including was expenditure security shouldered social government central the GDP to debts composite the of balance. At the same time, foreign exchange reserves fell short of the repayment of of repayment the of short 5) Fig. and fell 4 (Fig. interest with debts external reserves exchange foreign time, same the At balance. credit huge The a with confronted deficit. and funds capital the fiscal all of out severe taken was a system financial of because banks from overdrew government the was 1993 In China 2000, to 1994 areas. three in from deficits simultaneous of years comprised crisis seven macroeconomic a experiencing of period the in poverty people absolute million 80 of lift out “Eight-Seven to aimed called program so alleviation the poverty 1990s a Plan”, early Alleviation the Poverty in raised government central the When and restored spontaneously system, be could widespread povertywashenceputtoanend. autonomy economy village diverse and rural and economy livelihood peasant farmers’ small-scale traditional poverty in resume to investment massive make farmers “allowed” to and surplus rural of extraction the reduced condition state the if a only alleviation, in not was Although China extract. to period difficult this more in and more became it and surplus less and less had which Nong, San from surplus extracting stopped then It commerce. and from industry urban come mainly has revenue of source government’s of the industrialization accumulation for primitive capital of completion the after because mainly achievement, major acknowledged generally a became effort antipoverty her other, the on hand; one the on China Statistical Yearbooks 1993 and 1994. and 1993 Yearbooks Statistical China 7 of GDP in 1993 on the eve of the introduction of the tax reform; reform; tax the of introduction the of eve the on 1993 in GDP of 6 . It was estimated that in the year the ratio the year the in that estimated was It .

Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era”

61

9 199

8 199

7 199

6 199

5 199

4 199

3 199

2 199

1 199

0 199

1989 Deposit-loan spread of financial institutions (Unit: RMB100 million)

1988

1987

1986

1985 1984

Source: China Statistical Yearbooks Source: China Statistical Yearbooks

1983 1982

tal sun of fiscal deficit 1981

To (Unit: RMB100 million) 1980 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Fiscal deficit and the deposit-loan spread of financial institutions spread of financial and the deposit-loan Fiscal deficit Fig. 5: Changes in China’s Foreign Exchange Reserves in 1978-2004 Fig. 5: Changes in China’s 0.00 Fig. 4: Changes in Fiscal Deficit and Bank Deposit-Loan Balance in 1980-1995 Balance in and Bank Deposit-Loan in Fiscal Deficit Fig. 4: Changes 5000.00 -5000.00 10000.00 15000.00 20000.00 -10000.00 In the new millennium, to tieraised in by withthe thecentral “New government Measures inof forrecentthe ScientificPeople’syears inOutlookWell-being” support on Development,of thereciprocating the implementationthethree ruralkey issues tois exactlythe carrying presentout the overallnational national strategy policy of Experiencing countless hardshipsadjustment and difficulties,stage of industrialChina overcapitalizationfinallycapital, in went initiallythe classicalthrough theory revealing thesense. Economistin capital 1999Prof. Linthat accumulation Yifu “Nowpointed weout andare alreadyby facinginitiating ‘a viciousnew ruralcircle reconstructionunderinfrastructure, increase income, farmers’ expand domestic demand and ultimately relieve dual excess’;as a onlynational strategythe pressure of excess.” can we improve rural Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” TWO 11 10 9 8 stock ofresources because oftheirlower of externalcapital profitability requirement groups fallshortofthe These disadvantaged agricultural taxera” aged peopleinthe“post composed ofwomenand tend to be more and more Agricultural laborforces industrial overcapacity agriculture amid adjustment to reciprocate made thestrategic The centralgovernment CaiFanged., ZhengJuncai,‘A Survey ofthe Abnormal Existenceof50MillionRuralLeft-behind Women’. Ye Jingzhou andHeCongming, Beijing: SocialSciences Academic Press,2002. htm. Datasource:ofthe4 2008. 62 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy The Year 2002: A Report on Population and Labor Issues in China–Urban and Rural Employment and Countermeasure. and Employment Rural and China–Urban in Issues Labor and Population on Report A 2002: Year The th National Population Census by National Bureau ofStatisticsChina.http://www.stats.gov.cn/tjgb/rkpcgb/index. NationalPopulationCensusby Bureau The Lonesome Sunset: The Left-behind Elderly in Rural China. Rural in Elderly Left-behind The Sunset: Lonesome The male-to-female rate of 106.27% of rate male-to-female countrywide a revealed census national the But 87.97%. of ratio male-to-female a with in agricultural production agricultural in currently and of production, agricultural sustainers main the become elderly the origin, of places their outside work laborers middle-aged and young rural many as that indicates (2008) Jingzhong Yemajority. the Currently, in rural China, the agricultural labor force in many areas has tended tended million 50 approximated has already areas many year the in in women left-behind of number the 2006, in Weekly Economic force China by report labor a to according estimated As people. agricultural elderly and women of composed the be to increasingly China, rural in Currently, dollars. 4 to day a dollars 2 accepted internationally the from threshold poverty its increasing of cash-based of extent greater considerably livelihood in rural areas. Asa a result, in the nation, there is a discussion over the necessity and leading self-sufficiency employment, rural seeking States decreased to United the into and flowed young force rural the labor of third middle-aged one about in example, for common Mexico, very In and areas countries. developing less-developed in issue prevalent a is this Nevertheless, poverty alleviationprogramsnowlesseffective. well-received and effective once many making alleviation, poverty in difficulties increase thus and threshold poverty higher a to lead inevitably will This areas. rural impoverished inflows cash external on higher a more to leading and sustenance, for more depend they and through resource, merely labor living a own make their to them for difficult is it insufficient, is self-development China. modern in groups areas disadvantaged largest rural the in become behind have left women and elderly the cities, into resources higher human a of with stock capital labor of decades two past the in outflow massive the of Because the meaningofpoverty. historically important changes have occurred in both the impoverishment mechanism and that aware be and China rural in poverty of situation new the of understanding an have to necessary is it that out points report strategy,this national above the of recognition In environmental-friendly “resource-saving, a develop agriculture”. to namely set, specifically was in Additionally, culture. and 2008 society as well as protection, environmental and ecology as such agriculture of functions non-economic the on placed been has emphasis more on, 2007 From sectors. non-agricultural in peasants of employment localized promoted partly has which trillion, RMB2 over been has investment rural total years, consecutive four the In welfare. social and infrastructure rural strengthen to designed policies of series a introduced has government central the time, same the exempted. At thoroughly reconstruction”. countryside “new the of production in central and western China have increased from 17-18% in 1996 to the the to 1996 in 17-18% from increased have China western and central in production there were 349 million agricultural laborers in 2006, 53.2% females 53.2% 2006, in laborers agricultural million 349 were there a sustainable development goal regarding agriculture, rural areas and peasantry peasantry and areas rural agriculture, regarding goal development sustainable a 11 . Rural laborers aged 50 and above engaging in agricultural agricultural in engaging above and 50 aged laborers Rural . 10 8 . According to the second national agricultural census, census, agricultural national second the to According . , showing that female agricultural labor was already in already was labor agricultural female that showing , 80.6% of the left-behind elderly are still engaged engaged still are elderly left-behind the of 80.6% degree of cash-based livelihood of farmers in in farmers of livelihood cash-based of degree Since 2006, the agricultural tax has been been has tax agricultural the 2006, Since China Economic Weekly, Economic China Beijing:SocialSciences Academic Press, As their capacity for for capacity their As Issue10,2006. 9 and 46.8% males, males, 46.8% and

Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era” 63 Satisfying diverse needs Satisfying diverse of rural disadvantaged groups should become of the an important part effort poverty alleviation . These figures 12 strategies now need If these human resources then rural poverty alleviation should It is only that their labor resources cannot satisfy the Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Such needs cannot be met by relying on bureaucracy, which objectively gives FF4A4FB54. ‘Labor force Ageing Hampers New Rural Reconstruction’ http://www.cnca.org.cn/info/8271.html; jsessionid=2A9EB8073CC806DB7436E8C http://www.cnca.org.cn/info/8271.html; Ageing Hampers New Rural Reconstruction’ ‘Labor force have multifunctional connotations. Accordingly, rural governance should be helpful and conducive to the formation of a diversified society. Further, if we approve the idea of ecological civilizationGovernment No.1 Document” as of 2007 advocatedand deem that inless-developed rural theareas should “Central seek long-term, sustainable diversified development, rise to the necessity of incorporating the improvement of rural governance into poverty alleviation action – only by promoting the organization of disadvantaged groups acting as carriers to connect with external povertytransaction alleviation costs betweenresources small-scale can peasantthe economyexcessive and effectively thereduced. Poverty alleviation efficiencyexternal can thenbe enhanced. But thesectors present be rural top-down governance structure was from inthe San Nong essenceto satisfy industrialization and createdurbanization, in which it foris impossible extracting surplusfor disadvantaged groups to participate effectively. It inherently contradicts the idea universal benefit as pursued by the poverty alleviation strategy in the new period. of At the same time, many disadvantaged groups still have the labor potential resources into to capital. convert their That means after the stage of large scale poverty reduction in the 1980s (1978- 1985) relying on institutional reformdevelopment-oriented poverty alleviation in the and1990s (1986-2000) targeting regions and national economic development, the stage thenof targeting impoverished villages thein the new millennium, The needs of the disadvantaged group and sustainable rural development are of diverse, which link with the diversity of small farmers’ production to risks. reduce nature and market show that agricultural production is carried out increasingly by women and the Meanwhile, elderly. a great number of children are also important laborers in rural households. in agricultural production. They take part directly profitability requirement of the external industrial capital. are being developed in a comprehensivemultifunctional and diverse social capital so that way, poor peasants itcan maintain their isbasic still likelylivelihoods and to thus support agricultural convert and rural sustainable development themin less- into developed areas. to shift the target down to rural disadvantaged groups, especially the left-behind elderly and women. Accordingly the definition of antipoverty also needs to promotingshift fromthe unitarilyincome growth of the impoverished populationof disadvantaged to satisfyinggroups forthe sustainingneeds basic livelihood sustainable development. and for agricultural and rural 12 present 32-33%, a figure reaching 46% in(Zhang Shuguang provinces 2010). Some local field investigationswith reveal that thea elderly agedgreater 50 outflow of and above account laborfor more than 60% of the rural left-behind population Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” TWO to deteriorate agricultural taxeratends governance inthepost agricultural taxerarural After thechangesin 64 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy million mu,withmorethan78 millionfarmerswhollyorpartiallylandless(Han,2006). without 54.5 over to amount will occupied thus land arable 2030, to 2000 from years 30 the in behind left been have then 50%, to increases farmers China in ratio urbanization the If livelihood. of means assured landless of number large a mechanisms resettlement and compensation effective an of absence the In sector. urban toward areas rural from resources ‘outflow’ land the of to led land rural massive of requisition continuous speed, gaining urbanization and development industrial with Moreover, has which areas, become aconstraintfactoronthedevelopmentofpoverty-stricken community.rural in stay develop to abilities lacking and stock capital human the a however,hand, other the On since 1990s. lower with groups disadvantaged only result a as been reduction has poverty in which achievement great level, the to income contributing cash factor rural positive the raised hand, one rural the The on areas. urban exodus, the into flooded self-development of capable people most the areas, of rural and urban between gap income comparative the to due Second, development. rural and agricultural hampered severely has funds in Scarcity areas. rural in element economic scarcest the become nowadays has finance factor, leading the As 2007). al., et (Wu 2004 in billion RMB10,332.051 to 1991 in billion RMB462.296 from rise, the on was sector rural the (Chen in demand large and at supply financial between society gap in the 2004); loans gross the of 10.4% for only accounted to loans areas 2002 rural in and decrease, the banking on were national areas the rural and from agriculture taken for system loans 2007); al. et (Han deposits savings postal counting not funds billion, RMB451.92 of to amounted outflow cooperatives net credit the rural from and merely 1978-2000, during that: profitability reveals high research Related scale. liquidity, high with areas small and return low cycle, long of sectors agricultural from away scale, of urban economies and sectors agricultural non- into flowing towards speed gained under funds sector, mechanism, market-oriented banking the of reform commercialization of advance the with all, of First rural resourcesandconstraineddevelopment. of depletion the obvious to from leading return, of sectors rates low relatively with non-agricultural sector agricultural into a flowing entered began resources agriculture urbanization, and mechanism fast market products, the by driven 1990s, the agricultural In of development. of period golden prices raised the and industry) irrigation improving system, chemical in development example, (for technology contract agricultural of advance the works, household the of the arrangement as such factors institutional of effect combined the under up, opening and initial the reform In of stage “collectivization”. of causing period the factor in large at peasantry institutional the the of poverty the became modernization primitive and national provided for areas agriculture rural accumulation which in agriculture, arrangement strategic domestic The of peasantry. surplus the and only resources could the China new from of come founding the following industrialization primitive for late-comer, a accumulation as modernization exogenous of pursuit in country a China, outflow ofruralresourcesduringChina’s industrializationandurbanization. increased the of context historical the consideration into taking by understood be to The current impoverishment mechanism and the difficulties in poverty alleviation need Box1: MacroeconomicBackgroundtoPresentImpoverishmentofRural Disadvantaged Groups Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era” 65 The influence of The influence rural deteriorated is reflected governance mainly in three aspects: and fairness, efficiency development capability the lack a considerable Furthermore the material the behavioral choice of the rural elite Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Finally, the increased outflow of funds, laborextreme scarcity of human capital and material andcapital in the Due rural to community. land resources have led to the an drainage of the labor force with relatively plentiful human capital stock, the poor population left behind is mainly composed of highly scattered women and the elderly who have extremely little capital stock, or those vulnerable groups in areas with an extreme scarcity of natural resources. They have become more and more incapable of basic self-development and been increasingly marginalized in a modern and society market economy, with little potential for sustainable self-development.these structural changes,Due the to grass roots have very low labor capital stock, making it difficult for them to have access to external capital. Unlessa thelong-term State persists basis on in large-scale investment into in newfinancial resourcesrural withreconstruction, the visible hand ofputting government and driving other factors of production flow back into San Nong, otherwise impoverished rural areas willhave not the potential for having access to external capital even if the government continues its still industry-oriented poverty alleviation effort, because external capital has to bring together dispersed labor to lower transaction costs. Therefore, the changein targets of current poverty alleviation has objectively increasedpoverty alleviation. the difficulties in This aggravates considerably the difficulty in poverty alleviation: on the one hand, poverty poverty hand, one the on alleviation: poverty in difficulty the considerably aggravates This alleviation resources, in most cases, are acquired by a minority in the process of transfer into rural communities, making it hard to guarantee the involvement groupsof disadvantaged for their benefit, or ensure becausefairness of the absence in of allocationestablished organizational carriers, ofre-organization of resources;those onrural thedisadvantaged other, groups lacking human, material extremely high costs as well andas great difficulties in mobilization, leading to natural resources, involves of organized carriers in atomized rural communities leads to “elite capture”. A minority of people dominate resource allocation whereas the poverty-stricken groups, mainly the elderly and women, find it difficult toeffectively take part in various programs because of their lower stock of human and natural resources. decrease in the efficiency of poverty alleviation efforts. The The deterioration in rural governance affects poverty alleviation mainly in that basis of rural administrative authority is crippled. Rural public authority is (Yu, “in authority a grass-roots of vacuum” “suspension” the as this describe scholars Some 2006). (Tian, 2010). In the agricultural tax era, rural organizations as stakeholders had a clear behavioral goal and a definite structural function. With the implementation of reform agriculturaland thetax ultimateand levyrescinding of agricultural tax, rural areas agricultural havetax era. This has an important impact enteredon rural governance. On the one hand, a post the development of rural public service is confronted with difficulties under the pressure of grass-roots debts and rigid financial between farmers and expenditures;village cadres weakens, and on the other hand, the liaisondeviates increasingly from community interests as a whole. 2. Rural Governance: Impacts on Performance of poverty Era” Agri. Tax alleviation in the “Post Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” TWO 13 “captured” bytheelite alleviation resourcesare Massive poverty “Elite capture” mechanism: When entering rural areas, government resources and enterprises would choose agents of a certain scale, with scale, certain a of agents choose would enterprises and resources government areas, rural entering When mechanism: capture” “Elite Specialized Cooperative Economic Organizations’, Economic Theory and Business Management, 2009 (7); Wen Tiejun (ed.), Report on on Report (ed.), Tiejun Wen New RuralReconstruction inChina.Fuzhou:Fujian People’s PublishingHouse,2010. (7); 2009 Management, Business and Theory Economic Organizations’, Economic Cooperative Specialized National the of Project Key the of Force Peasantry’s of Development The Task the and Countryside” the to See: “Going Capital and Departments ‘Governmental (06AJY003), Fund communities. Science Social rural within elite and households peasant influential and large by seized be would income of majority the large, at governance benign a of absence to due resources; external with connect to agents as act could elite and households peasant influential and large only de-organization, rural of situation the given cost; transaction reduce to aim the 66 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy and natural resources, which leads to a weaker base for rural governance. These These governance. their developmentcapability rural for base weaker a to hard is it to improve which in situation a in entrapped therefore are groups disadvantaged leads which resources, natural and resources human of of stock lower ever an causes outflow resources of depletion The the areas. depressed from accelerates This capital. external of the meet requirement and profitability capital social diverse and multifunctional form to groups disadvantaged these lower mobilize effectively a to difficult also is it a governance generally In rural deteriorating yields. of gain situation having to “capitalized” be elderly, to hard the are resources, and natural and human women of stock as mainly such population, groups impoverished the era, disadvantaged levy and tax post the in importantly, More resources not being used effectively within rural communities rural within effectively used being not resources alleviation poverty for reasons important most the of one is resources, external to relation “Elite capture”, a widespread phenomenon in rural areas with deteriorating governance in groups disadvantaged of exclusion the and Capture” “Elite analysis: Mechanism 2.1.1 majority excludesdisadvantagedgroups. groups, disadvantaged to resources namely: alleviation poverty transferring in difficulties for reasons two are there deteriorating, is governance rural which in situation current the In transferring in difficulties resources ofpovertyreductiontodisadvantagedgroups governance: rural in Deterioration 2.1 rural households are isolated, massive in number and highly dispersed, transaction transaction dispersed, highly and number in massive isolated, are households rural Fig. 6:HowDeterioratingRuralGovernance Affects Poverty Alleviation inPost i) a small number of elites compete for, or “capture” resources; and ii) the the ii) and resources; “capture” or for, compete elites of number small a i) (seeFig.6). Agricultural Tax Era 13 . In a situation in which which in situation a In . Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era” 67 . Nanjing: Jiangsu People’s The interests of the real disadvantaged groups are excluded as they don’t have a say Disadvantaged groups are excluded Cultural Right and the State ; Dong and Wen 2008). ; Dong and Wen , Issue 5-6, 1999. ; the members shared a common 15 Open Times Wen and Feng, 1996 and Wen Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage , the “good gentry” governance mechanism which might take care of the 14 Press, 1990. For the description of agents as “protectors” or “profit seekers”,see: Du Zanqi, Zhang Jing: History: Sources of Local Authority. Authority. Zhang Jing: History: Sources of Local cultural and ethical system, and the community elite was the agent of the community’s common interests and had its own interests realized whose by protecting the community, authority came from the prestige bestowed on him or her by personal experience and 15 14 In the meanwhile, since the role of the rural elite has changed from “protectors” to “profit seekers” This was a ubiquitous result in theland contextwas contracted ofto and long-termoperated by institutionalrural households in thechanges. organizations1980s, administrativeAfterat village and township levels in fact no longer self-sustaininghad a operations.property Localbasis treasuryfor departments began “decentralizing power to lower levels as a way of throwing off burdens” (permitting township governments to levy uniformly pooled fees on farmers to meet their expenditure When needs)the macro-economy oneencounters downturn afterpressures, the another. institutional costs of the urban economic crisis were conducted and transferred to agriculture,farmers, leading to tensions in rural ruraleconomic As relations. a result “good areas gentries” were and expelled by “bad gentries,” which was a commonplace in history and nowadays happens Eventually rural more communities frequently. witness the wreckage of social ecology on which rural governance depends. ( resources; external transferring agent an as act must elite the hand one the on Therefore, on the other hand, a type of cooperation emerges inside the rural community in the form of pro-big household governance, in which the majority large rural households The and problem elites. of public interest eroded ofby “elite capture” yields are appropriated by is widespread in rural society. Inherently, rural society Inherently, has always been regulated by elite politics. But through changes over a long period, the benign ecology of rural governance has been wrecked, and the behavioral choices of community elites haveinterests at large. deviated increasingly from community This is also supported at a local level by case studies For on example,rural itgovernance was transition.found in surveys that when the and taxlate-1990s, in some burdenvillages, village cadres who increasedwere able to shift institutional in costs the mid- out forcefully by all means came to power, and gradually superseded the rural elite who traditionally relied on “responsibility for lower levels” to maintain community governance, leading to the start of the deterioration in rural governance. In the post tax and levy era, however, agricultural tax has been abolished and the State is implementing a strategy nationalof new countryside reconstruction. When massive resources are being put into rural areas, the rural elite’s demand for being the conflictfirst ofto interests be betweencompensated elites insideleads andto outside a the system-to break and even confrontation. village elections, petitioning, mass disturbance, out through costs are excessively high for both government resources and external industrial capital to enter rural areas. Confronted with this problem, it usually needs an agent capable of internally reducing the transaction costs on behalf of a rural community. Generally, this a rural community. economic elite in by the political or role is played In rural society, a small-peasant village community based on kinship and locality was a relatively closed “commonwealth” (Zhang Jing 1999) disadvantaged is also undermined. Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” TWO 16 Fei Xiaotong describes such governance as “presbyterial ruling” based on edifying power”. See: Fei Xiaotong, Fei See: power”. edifying on based ruling” “presbyterial as governance such describes Xiaotong Fei Publishing Group, 2004. 68 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy groups in the minority. the in groups disadvantaged of interests the for care little say,having more with those of interests the satisfying toward looked gradually and interests public of seekers”, care taking from behavior “profit its in into deviated evolved already role whose elite, community the right, ecology,to governance due a such In interests. and networking materials social on increasingly based members between relations and of with degenerated, gradually system influence value and the and cultural society’s society rural rural consumerism, on market pressing power administrative state’s the With such governance,thedisadvantagedwereusuallyprotectedbyelite. Under prestige. elite’s the increasing of means effective an usually was disadvantaged be introduced to prevent external resources from being excessively captured by big big by captured excessively being households andtheelite, from resources external prevent to introduced be must mechanisms check-and-balance certain for hand, than other higher the on yields” households; “extra ordinary for needs their satisfy and costs transaction reducing in resources, external receive effectively to villages society,for rural of atomization increasing of state objective an in conclusion, In they alsofacesimilarlytheproblemofexcessivelyhighcostsforsocialsupervision. villages– inside resources transferring in fairness of lack this tosolve supervision external to look to difficult apparently is it time, same the At voting. majority through determined or elite the by manipulated is allocation resources the whether say, least the have and mostly aid of need in are who groups disadvantaged the consideration into take really to therefore, community, the approach resources alleviation poverty When tended toexcludedisadvantagedgroups,ratherthanprotectingthem. the public opinion of the community (Fei 2004) (Fei community the of opinion public the for active participation. It is required that a village should propose a program according program a propose should village a that required is It participation. room active for little have groups disadvantaged program, alleviation poverty a of operation implementation and the and villages, impoverished targeting of procedures specific the well as as village poverty identifying of approach and criteria of perspectives the all From disadvantaged groups generallycannotbeprioritized. needy of interests the villages, inside applied is principle majority the if Even system. organizational this in power decision-making and say adequate no has generally groups, disadvantaged mainly population, poor the households”; influential and “rich by operated and elite the by managed usually are villages to transferred resources practice, In use oftheexistingadministrativesystem. full makes it since implementation, program for costs organizational the degree certain a the and committee village, Party a to reduces to village method This hereinafter). committees” village-level (“two existing committee villagers’ the transferred by are mainly resources organized is alleviation implementation poverty When levels. various at governments by administered and transferred are resources system, alleviation poverty present the In groups. disadvantaged to resources alleviation is poverty transfer it to difficult that prevails phenomenon common a groups, disadvantaged against discriminate people most that regularity objective the and capture” “elite of existence the of Because allocation ofPA resources in discrimination and poor the of involvement Inadequate PA practices: 2.1.2 due to restrictions resulting from improper rural governance, administrative administrative governance, rural improper from resulting restrictions to due At the same time, ordinary rural households in the majority also also majority the in households rural ordinary time, same the At andavoidexacerbatingthepovertyofdisadvantagedgroups. it is necessary to accept the elite’s active role role active elite’s the accept to necessary is it 16 . changes in the source of power and power of source the in changes The protection of and care for the the for care and of protection The Rural China Rural it is impossible impossible is it . Beijing: Beijing Beijing: . Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era” 69 Beijing: China . 18

In practice, many programs are still China Development Report 2007–Eliminate Poverty in Development. September, 2005. September, . 17 . 19 edition, September 2007, p118. st Mid-term Evaluation on the Poverty Alleviation and Development Program for Rural China: An Assessment of IVDP Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Since lack of organization and concerted action, the scattered poor population, Development Press, 1 The Task The Force Task of China Development Report 2007. Ibid. Implementation and Poverty Alleviation Effectiveness. Wang Sangui. To sum To up, affected by the current deterioration in rural governance, poverty alleviation resulting in resources a cannot widening be poverty transferred fairly within a community, The gap. impoverishment of disadvantaged groups is thus aggravated. In the absence of supportive rural governance, it is difficult to solve fundamentally the problem of fairness specific on merely relying by villages within resources alleviation poverty of transfer the in technical improvements. The scarcity of production factor determines prices of factors. The factors are in Therefore, the in position rural to areas set where the capital rule of games. ones who own the implemented programs alleviation poverty industry-oriented factor, scarce extremely an is by the government to support agents capitalizationin of possessionresources end up of mainly capitalin “elite capture”to – increaseonly rich higher capacity for resource development are able to share the benefits of capitalization. peasantsgains with a by As with IVDP, there exists the programs.problem Though ofpolicy screeningprescribes that in poor laborvillages given priority trainingin and participating in needytransfer training, in familiespractice andtrainees are usually transfershouldlaborers be in poor counties who are “willing” to participate. As some poor people cannot participate in afford training, they have fewer opportunities to participate than non-impoverished to people. Surveys also reveal that during earlyfamilies implementationwith close relationsof witha trainingenrolment organizersprogram, (especiallymore likely to participate firstly in training village cadres) are The other two measures, rural labor training and transfer and industry-oriented poverty alleviation, which together with IVDPmeasures since the start of constitutethe are new also century, liable to give rise to “discrimination the three major poverty inside villages. against the poor and in favor of the rich” alleviation 18 19 17 to its own situation and make a plan complying with certain procedures. a For villagers’ example,group first raises a program proposal to be summarized and determinedvillage at congress, then invites experts, usually county-level povertyor alleviationprovincial-level officialsresident officials in the village, to discuss financial plan,the andprogram finally reports itand to highermake levelsa for approval. However, assessments have highlighted that ordinary peasants generally don’t have a village-level poverty alleviation clearprogram is, nor do they know about ideathe financial sources. of what the They are at times indifferent in the process formulated under government operation and with involvement of the elite, as a minority in villages. It is hard for poverty alleviation resources to effectively target the poor population, as the participation of the poor population cannot be ensured. For example, in IVDP projects, though projects like road construction, may improve the infrastructure of villages, but the poor population may not substantially benefit due to their limiteddesigned programs some for As participate. to usecapacity of lack their of because outcomes of the program’s to better people’s lives, such as drinking water households to get involved funds usually makes it difficult for impoverished and biogas, the need for counterpart mainly disadvantaged groups, are also unable to get involved in the formation of poverty alleviation programs. Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” TWO the processoftransfer alleviation resourcesin the seepageofpoverty state cannotreverse in alessorganized Disadvantaged groups alleviation costs forpoverty increases organizational of ruralhouseholds The atomizedstate 20 Ibid.p.166. 70 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy of PA programs impact short-term and resources PA of efficiency delivery Low 2.2 sources to maintain their own operation, promote growth of local fiscal revenues and and revenues fiscal local GDP of growth promote operation, own their maintain to sources financial obtain to how example, for alleviation, poverty than issues pressing more many put funds into poverty alleviation. Besides, in many deprived counties, governments still have to unwilling more governments local make alleviation poverty of efficiency low costs and high the governance, rural in participate to poverty groups is of disadvantaged it for which impossible seepage in the situation, current reversing the In to transfer. of process the in conducive resources alleviation not is structure atomized an under governance rural behavior, government for incentives of perspective the from Besides, the fairnessofprogram,butalsogreatlyunderminesitseffect. affects only poor,not the which of needs real the meet to program alleviation poverty the for difficult very is way, it this In planning. and identification project in say no have They passively.program the in participate simply groups needy real the while government, the by uniformly designated or cadres poverty village a by of monopolized either selection is program the alleviation governance, rural supportive of absence the In programs. needy the by participation Inadequate organization andalsoleastinvolvementinpovertyalleviationprograms. of degree low a have they So re-organization. of cost the natural afford hardly social can and form and capital, spontaneously capital to necessary human surplus of and resources stock the lacking lower a resources, have groups disadvantaged Secondly, a community. within resources social various of coordination effective obtaining in difficulty of because for costs implementation high program for cost extremely total the considerably requires increases also only but not mobilization, which area, rural a in farmers implemented reorganize when to need usually program alleviation poverty A allocation. resource of terms in problems other many long to rise the give they after Moreover farmers de-organization. of course mobilizing of incapable become have committees two the village-level areas most in because implementation and organization of costs the in lowering limited very is function its households, peasant targeting directly than extent certain a to less costs implementation program for committees village-level two of role current the Though costs. high excessively of because farmers scattered of number large a with transactions make to society,difficult rural is entering it when which with in confronted be of encounter inevitably will programs alleviation advancement poverty carriers, organizational pre-existing of absence the to due all, of First efficiency ofthepovertyalleviationeffort. the on influences far-reaching producing thus atomization, of modality a in increasingly milieu social and market modern a in themselves find process peasants and long de-organization, a of experienced has society rural reform, economic of inception the Since with costs organization and transaction atomized households High analysis: Mechanism 2.2.1 but have little effect on poverty alleviation. In addition, a less-organized community community less-organized a of seepage addition, is there Whether government. In the over supervision effective exercise cannot alleviation. poverty on effect little have but achievements, official their and revenues government economy, local the benefit which programs on funds alleviation poverty use to incentive strong very a have governments 20 ; then, as poverty alleviation funds reach county and township levels, grass-roots levels, township and county reach funds alleviation poverty as then, ; directly affects the outcome of poverty alleviation poverty of outcome the affects directly the plight any external agent would agent external any plight the

Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era” 71 A poverty alleviation poverty A directed program totally by the government costs requires higher The social capital of communities cannot be effectively mobilized Poverty alleviation costs high with programs yet low yields are hard to continue Needy small peasants in decentralized operation have low returns It is expressed concretely in the . 21 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Under Under conditions of deteriorating rural governance, it is also difficult to re- cited from Ningxia News Net (www.nxnews.net), June 17, 2005. cited from Ningxia News Net (www.nxnews.net), Li Changping. ‘The Eighteen Inappropriate Institutions Impoverishing Peasants’, a speech by Li Changping at Agricultural China University, Under decentralized operations, the disadvantaged have no choice but to accept market prices. Production cost is high because of price increase in the means of production low returns of peasant households. 21 organize these disadvantaged groups to form diverse social capital, makingmeet the profitability expectations ofit external resources. hard to In deprived communities, the human and natural resource stock of thelike the disadvantagedelderly and women at large is low, and difficult to capitalize to gain incremental returns. 2.3.1 Mechanism analysis: Shortage of human and natural resource stock for external capital 2.3 Needy groups into a deteriorates vicious circle where rural governance There are many cases in povertycosts alleviationand the practiceabsence inof whichmobilizationfor highimplementation oforganizational of communitya poverty alleviationresources program. constructedleadFor example,to roadssomehigh NGOsin costshavethe mountainous areasalleviation, of with Guizhoua cost for of theless purposethan RMB10,000of the same povertyfor project a may cost 1km-long, RMB80,000-100,000 in the 5m-wide government’s poverty road,alleviation while program. The reason underlying the cost difference is the thatvillage labor theforce, with formeronly explosives, fullytools, crusher, rubbing mobilizedmill and technicians provided externally, whilst the remainder of the project was organized by the villagers,reduced costs which considerably 2.2.2 PA practice: High costs yet limited lasting effect limited lasting effect High costs yet practice: 2.2.2 PA poverty alleviation resources in the process of transfer thus depends only on supervision government. within the and self-examination To To sum up, although the fundsprograms and intoreal deprivedassets communitiesintroduced havethe via infrastructure a povertypositive andalleviationeffect living on conditions,the external assistance is always insufficient to meet the development improvement development capacity, and the of reconstruction and improvementneeds of of deprived communities and disadvantaged groups. External poverty alleviation resources must function in co-ordination with community resources in order to produce best results. Given current rural governance, however,communities the stock of cannotresources inbe mostdisadvantagedmobilized groupsdeprived have little human effectively.capital stock, they cannot participate Asconstruction inand production programs without effective community basicorganization. In those women, the elderly deprived communities located andin ecologically vulnerable areas lacking natural resources, other program implementation requiresconditions, the highfollow-up managementcosts and advancementand of ais program especiallyimportance.is of particular Thissubject cannot toalways natural relyby all oncommunity external members forces,to take thebut lead,implementation,requires and formulatetake corresponding organizationdevelopmentmeasures to address problemsplans, in the organizeprocess of project implementation. Without strong and effective community organization, it is very outcome of the program. difficult to ensure effective Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” TWO everyday life Unable totacklerisksin risks Unable totacklenatural high-caliber laborforces outflow ofcapitaland leading toamassive poor abilitytotacklerisk, Atomized households’ 72 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy finally leaving the needy in a vicious circle of deteriorating governance and increasing increasing and difficulties incapabilitydevelopment. governance deteriorating of circle resources, vicious a of in outflow needy the the leaving accelerate finally turn in will governance rural in deterioration this and areas, deprived in governance rural of quality the worsen further will capability.This development basic lack increasingly will elderly, the and women like disadvantaged the especially population, poor communities. the rural And within capital material and human caliber laborers are continuously flowing out of deprived areas, which lead to a scarcity of high- and capital risk, high and profit meager returns, low of consequence direct a As rural communitiesinastateofdisunity. within adequately addressed be cannot these All networking. and social rural via relatives in of acquaintances help the system without tackled security be cannot social life in national disasters unexpected the areas, by coverage comprehensive of lack the Given farmers. among cooperation organized from inseparable are pests, and diseases and plant of control and endure prevention construction the and to as facilities, drainage and such irrigation income of maintenance production, and agricultural property in issues little it basic having risk, The independently. whichever households For small etc. needy ageing for and difficult illness vulnerable is disability, ecologically by on caused change risks and climate of areas, impact a weather, as yields crop devastating in of farmers reduction result life, others, and among including, production risks, In various risks. encounter various often are with dealing households of disadvantaged incapable these increasingly decreasing, is livelihoods basic in rural and investment constantly, out flow laborers high-caliber and resources as meantime, the In in delays of result a as fluctuation price access toinformation. market from suffer usually they costs, high excessively involves households individual by information market of acquisition because Besides, producers. the of profitability reduces return in sector circulation and processing the in profit higher The profit. considerable make usually which value, added higher with products agricultural of sector circulation and processing in involved get to difficult very it find producers the market, the of understanding as well as to, access and capabilities necessary lacking time, same the At operations. fragmented to due cost of rise the and into poverty. They depend more heavily on agriculture, and most of the agricultural agricultural the of most and Real subsistence. maintain to consumption own their for used agriculture, are produce they products on heavily more depend They poverty. into back fall to likely extremely are poverty, of out lifted if even poverty, absolute in People nets, safety community to liable traditional more plunge farmersintopoverty. are of families within fluctuations periodical degeneration and the expenditures unexpected given time, same the At having littleabilitytocopewiththesituationareworsthit. weather in recent years has aggravated farmers’ losses. Among them, the disadvantaged catastrophic frequent The facilities. conservancy water many of maintenance long-term of for residents half rural on rely to first viable longer no the is it in de-organization after that reveals 2010 provinces southwestern five hit which drought severe The flooding. these do nobody now and drought ordinary but handle hardly now can facilities works, These de-organization. of because other do and ponds and rivers dredge ditches, and the areas. For example, villagers used to cooperate with each other to repair irrigation canals of rural in nets safety social absence and carriers organizational of degeneration returning the to due risks, poverty with deal to capacity weakening people’s poor of everywhere and found be can Cases ratio poverty High disadvantaged practice: PA 2.3.2 Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era” 73 . Beijing: China The disadvantaged are The disadvantaged liable to return extremely even after to poverty out being lifted The poor are incapable of self sustainable development and thus marginalized Forming benign rural governance requires material and social bases China Development Report 2007 – Eliminate Poverty in Development . 22 edition, September 2007, p58. st Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Development Press, 1 The Task Force The of Task China Development Report 2007. In the current general situationfrequently, in marketswhich fluctuatecatastrophic drastically weatherforces andare increasinglyoffunds draining all as away, iftypes wellthe viciousas strikes circlehigh-caliber of and deterioratinglow development governance capability laborers is not broken, poverty alleviation action can only be an remedy ineffectual and can hardly overcome the potential risk of returning to poverty and help the poor towards sustainable development. The most likely result is that leftthe behindpoor in rural areas, mainly women and the elderly, are going to inextricable long-term dependence be on poverty alleviation by boundthe government, and remain by an with a psychology of unfairness. marginalized in an unequal social status 22 Culture is an institution in a innovation in a broad sense. broad sense, so cultural innovation is an institutional 3.1 Foster cultural cooperation of the disadvantaged Currently, pilot projects in various fields have maderegard and obtained many valuable experiences. some useful explorations in this Eventually, the village-level autonomous management organizationsto mustcombine be with formed external poverty alleviation resources,mobilize reduce transactionsocial costs resourcesand within government and other social forces to improve the efficiency of poverty alleviation efforts. villages. They must functionUpon this foundation, if comprehensive cooperative organizations with inwide participation synergy with the by peasants can be promoted in a timely way to help the disadvantaged to diversify risks and ensure a stable return, their comprehensive developmentenhanced. capability can thus be 3. Thoughts on Solving PA Problems and Local Practice 3. Thoughts on Solving PA Since current rural governance militates against poverty alleviation efforts targeting the rural disadvantaged, improvements in rural governancealleviation goals in the new stage of poverty reduction. Both the implemented IVDP since must be included in poverty the beginning of the new century and the pilot projects of mutual aid funds in depressed villages since 2006 have togovernance in deprived villages. The ensuing therefore, poverty should aalleviation policy, certain extent laid the thus villages, deprived of needs cultural and social diverse the meet to step further a take material base for improving rural governance. laying a sound social base for supportive products account for the majority of their income. Their basic needs for cash payments (for (for payments cash for needs basic Their income. their of majority the for account products example, daily necessities like medical treatment, education and clothing) can only be met by cash income from the meager surplus of their products. Once the price relations of agricultural production or agricultural products agricultural products drop, or worsenthe prices of products used in agriculture like (for fertilizers and example, the prices of pesticides rise), their living conditions deteriorate remarkably. For those needy groupsliving in remote and ecologically vulnerable areas, it is all the more so. For example, an analysis of the data from rural households surveys by the National Bureau of Statistics of China revealed that the considerable decline in grain prices in earlier the average income of 10% of the lowest-income peasants (those yearswith per capita income caused level in 2005 roughly at the development poverty line in 2000-2003 poverty line) to fall below the subsistence Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” TWO desired resultsfaster lower costsyetproduces cooperation requires Start fromcultural 74 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy and theecologyofsupportivegovernance. values and culture community in changes about brought also has organization cultural particular, In benefits. social and economic good improved participation, enhancing whilst carrots, of planting achieved have and disadvantaged, the of participation the with ideas, own their on based ecological in engaging cooperative and elderly, economic the an of organized association finally an and team cultural and entertainment an up set first women and elderly left-behind to the forces, delegated social other cadres and University China, Agricultural China of University Renmin the from volunteers of help the with outside, work and leave laborers young most where Province Henan of County Lankao in Village Hucun In example, For areas. rural various in of projects pilot carried have University China Renmin the under Reconstruction Rural for Center the of volunteers The at thevillagelevel. out carried is alleviation poverty when solved be to problems pressing most the are these governance. supportive resume helps also values and culture community of rebuilding All The cost. organizational low has fields cultural in cooperation cases, pilot in indicated As middle-aged and young than labor forcesworkingoutsidethevillage. culture rural forward carrying and spreading of capable more are who culture, rural traditional of carriers important most the also are they time, same the At them. among resonance a evoke would organized, rural once activities, Cultural the that is existing etc. life community care, cooperation an association, entertainment, basic for appeal long-neglected and have children cultural and women of elderly, left-behind the including effectiveness disadvantaged prompt the for reason The or culturalconnotationsforthevillagers. life of ideas important carry especially rites, times. Traditionalmajor modern and festivals in aspects new formed also has but years of hundreds for inertia historical experienced has culture rural custom, of type a reconstruction. As its on effort, investment huge than appropriate rather an with only again once vitality with burst will which society, rural in exists inherently life cultural that in costs institutional lower requires cooperation Cultural of beingmarginalized. state their alter and life cultural their change help may culture of field the in cooperation easily. fairly established is cooperation which nature in by field is a interests, material by measured not essentially is and fast results desired within capacity co-operative and Moreover, communities. awareness co-operative enhancing of process a culture is rural of reconstruction the and homogeneity community of carrier essentially intangible is an culture because is This cooperation. of costs organizational the lower groups, cooperative a foster to communities. Torural impoverished within these culture atmosphere of level organization the improve social no is there households, of atomization the other during disappeared almost have networking and systems and value and cultural the as time, women themselves among elderly, the cooperation capital. social and material, same human, the of At stock lower relatively their of because establish hardly especially can usually groups, persons, disadvantaged impoverished Individualized cultural and value systems must first be reshaped within communities, to to communities, within reshaped be first must systems value and cultural cultural life, which requires little investment yet produces the the produces yet investment little requires which life, cultural For the rural poor in particular, particular, in poor rural the For Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era” 75 Injection of external resources must be combined with improvement of rural governance to produce a better effect Disadvantaged and Improve Community Governance and Improve Community Disadvantaged Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Box 2: Hucun Village Uses Cultural Organization to Increase Participation of the Participation of to Increase Uses Cultural Organization Village Box 2: Hucun In Hucun Village, cultural cooperationgradually: villagershas beenare changingnow having theeachgreater other,village’s communicationand a settingcommon and practiceinteraction of association mutual withof thehelp elderly hashas beenassisted the takingvillage committeeshape. in between Themediating villagers. The conflictscooperative has also set up an aid group to help the elderly, the disabled and families short of labor to do farm work and housework. Gradually, on the basis of cultural cooperation, organizers have begun planning for cooperationeconomic between villagers. So far, the cooperative living conditions. villagers’ which has improved has run for several years, Source: Center for Rural Reconstruction, Renmin University of China. IVDP, the IVDP, most important poverty alleviation measure for the period from 2001 to 2010, processes the in villages deprived in peasants of participation wide a encourage to aimed of program selection, implementationpoverty alleviation investment to improve the production and andliving conditions in deprived supervision, and use of villages.comprehensive However, these efforts overall didn’tdidn’t adequately attainparticipate in program theselection, implementationexpected and supervision, results.nor Peasantsmobilized their social resources. Nevertheless, successful some outcomes. As pilotindicated programs earlier, this may achievedbe attributable moreto the synchronous advancement of program implementation and village-level resources alleviation poverty of support in resources community massive mobilized which governance improvement, reduction poverty sustainable for mechanism supportive a to rise gave gradually then and and rural development. Fostering autonomous peasants’ governance organizations problemcan effectivelyof thesolve lowthe efficiency of considerably save povertytransaction costs for alleviationscattered small peasants on the one programshand, and in on ruralthe other areas.fully mobilize various It community canresources as complementary to external poverty alleviation funds. In addition, a community with an established organization may increase its participation in program design and the usemore likely of to projectenhance the funds,relevance of and a thusprogram, and is exercise improved supervision over the allocation of funds. 3.2 Introduce external resources for better village governance and mobilizing rural social resources There are many other cases for women organizing by began also Shanxi in City” similarYongji of Town Puzhou of toAssociation that of Lankao. For example, the cultural cooperation before gradually forming a peasants association with comprehensive “Peasants functions including production and culture, resulting in healthy development. In addition, the experiences of the Center for Rural Reconstructionof China underhas obtained the from Renminother rural Universityreconstruction experiments conducted in recent years has also revealed the low costs and ofhigh theefficiency disadvantagedof enhancing involvementand improvingculture. In ruralrecent years, the governanceCenter has enrolled students fromby more startingthan 100 colleges fromand universitiesthe field of to participate entertainment and cultural ingroups and peasants associations, laying particular “aid-for-farmer”emphasis teams, helping set up associations of their own. on mobilizing women and the elderly to villages organize Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” TWO 76 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy (including funds and supervision), it would have been very hard to mobilize village village mobilize to of means hard (by out flown very have either been would resources These have development. for would resources it supervision), and funds (including resources external large-scale of input continued Without effect. alleviation poverty best village-level good that was the project in resulting resources alleviation poverty large-scale Village with combination in governance Daxu the of feature prominent most The The villagersnowhavefullconfidenceinthefutureof village. more much and united peasants. more by supported be to affairs village for easier much been has it become and harmonious; have villages improved; has governance level village- village; the of aspects many in then since placed taken have changes Great the projectswerebasicallycompletedwithinoneyear. All etc. building, office village and digester biogas a of construction the dredging, pond and river leveling, land apparatus, fitness buying and plaza cultural a building for used mainly were departments other by provided funds The funds. aid mutual village-level for RMB150,000 and spent, RMB40,000 with wells irrigation 8 RMB100,000, taking toilets public and room cultural a RMB100,000, worth lamps street 40 million, RMB1.16 costing village the in household every year,to a road than including: less in projects of number a finished village the mobilization, resource and management organizational internal With Village Daxu was RMB1.55million,plusasumofsomeRMB200,000fundedbyotherdepartments. in investment total The funds. lottery central of support the with IVDP for government county the by 2009 in selected villages pilot 15 the of one was Village Daxu used nationallotteryfundsforIVDP. County,Town,which Zhanggong Ningling Henan, Village, in Daxu of that is case Agood Source: Wang Sangui and Tong Zhihui et al: The Practice and Inspiration of Pilot Pilot of Inspiration and Practice The al: et Zhihui Tong and Sangui Wang Source: IVDP with the Support of Lottery Fund, June, 2010. June, Fund, Lottery of Support the with IVDP mu arableland)tothevillage. This isunimaginableformostvillages. 80 (including land additional of mu 148 adding RMB20,000, than more slightly of sum a only for up leveled and filled were watercourse original the and pits waste the and program, the in participate to volunteered village the across laborers 500 than More first, I phoned my husband myself, asking him back from Shangqiu to dismantle ours.” houses their dismantled had brothers two his and secretary the that and all, benefit would road broader a that down considering But torn RMB80-90,000). at be estimated loss to a (with were house and wall courtyard the that beginning the at learned I million. One woman put it honestly, “I have eaten nothing, but cried for two days when RMB1 over to amounting losses economic with removed, houses their of parts and walls courtyard their the had voluntarily and households 36 cadres, program village the the by leadership for support peasants’ the to thanks Secondly, RMB150,000. of loss a with house, their of part and wall courtyard own their removing in lead the took members family his and head village the village, the in road main the broaden over Tocontributed RMB6,000. treasurer the head and RMB50,000, and head village deputy the secretary RMB100,000, village the implementation; program village-level during two the of members main the committees not only spent a lot of time and energy but also contributed a lot of money Firstly, reduction. mobilization cost resource sound of program a terms and in with result good committees a achieved has village-level base two on organizational relying Village Daxu in IVDP The Box 3:CommunityResourcesMobilizationintheIVDP inDaxuVillage ofZhanggong Township, NinglingCountyofHenan Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era” 77 Promote comprehensive cooperation of the disadvantaged to gain stable returns Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage only by developing comprehensive cooperative organizations incorporating Because of the lag in impoverisheddevelopment households beingof unablethe to ruralget enoughof financialsupport became productionmore and more fundsoutstanding. market,Since asthe early a 1990s, meansvarious thesmall- problemsized micro-finance andof community fund experiments were conducted countrywide,an in effort to relieve the constraints of production credit funds on impoverished farmers, 3.3.1 Experiences of the village-level mutual aid fund Both existing poverty alleviation efforts and rural reconstructionfields have achieved some experiences in this regard. experiments in other functions of financial cooperation, cooperation and entitling them by legislation to exclusive powers and preferential policies purchase and sale cooperation andin several specializedagriculture-related fields, can small peasants constrained by resources truly have access to opportunities of sustainable development. As seen by the experiences of small farming households in other East Asian countries like Japan, South Korea and Taiwan provinceexperiments, and by many local rural construction It is well-known that, in the context of agriculture industrializationhas low comparative andreturns. Relyingmarket-led merely on development,agricultural operations can hardly lift agricultural producers out of poverty stably. It is not commonly admittedeven that for organized farmers, cooperation inwith risks a from singledrastic market fieldfluctuation andgenerally from the changecan inhardly natural conditions.general,cope In small peasants can still maintain their which they productionconform to Chayanov's hypothesis that a peasant household operationscannot expel its in a fashion in so labor, they can exclude the counting of the portion of production costs for maintaining subsistence. But if cooperation is carried out in the production field, the circumstances are different in many ways: the opportunity costs ofcontinuously made visible and increased by wages earned from working agriculturaloutside; and the labor investment are income of the cooperative from planting can hardly ensure the continuity of cooperation. Therefore, relying merely on simple cooperation in production can hardly out lift of peasantsthe plight of underdevelopment. Most of the agricultural cooperatives engaging merely in production ended up in failure. worldwide After the mechanisms of cultural cooperation and become mature, communityconsideration from resourcesthe governmentmobilization may be givencomprehensive cooperation toframework into introducingrural communities to improve the a self- households. development capacity of disadvantaged 3.3 A comprehensive cooperation framework for self-development disadvantaged capability of the On the other hand, without an effective and benign governance structure, it would have been impossible to use external resources in a sensible way. New contradictions would have emerged among the villagers over scrabbling for external resources and interests. Such cases indeed happened in smoothly,some IVDPs,not to makingmention projectsthe formation unable capability. sustainable development of toa supportiveproceed community governance and outflow of labor force and of funds into cities in the form of bank deposits) or been wasted wasted been or deposits) bank of form the in cities into funds of and force labor of outflow in worthless activities (for example, card games, mah-jong and other forms of gambling prevailing in rural areas). Without the support of external resources,would have had neither the ability communitynor the will to invest alone in community development, elites all. could hardly have improved at and community governance Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” TWO 23 operational costs can hardlycoverthe the fieldoffinancing Mere cooperationin peasants cooperation among fund topromotefinancial village-level mutualaid been gainedinusing Certain experiencehas World Bank’s TCCT Expert Panel. 78 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy Survey Report on Village-level Mutual Aid Fund Program Fund Aid Mutual Village-level on Report Survey that the sole operational returns of a mutual aid association comes mainly from interest from mainly comes association aid mutual a of returns operational sole the that association. aid mutual Ais program the of operation affectingsustainable factor the core in as programs well-operated Wangcang, manyin places have revealed problemsgained preliminary requiring attention of in theexperiences operation of stage the the a from in Apart still is experimentation. program fund aid mutual village-level the present, At selection, village on conducted been have mobilization ofvillagers,andorganizationalmanagement. explorations capability, a such foster To capacity.self-management sustainable of by formation the and villages deprived of villagers participation active the in lies funds aid mutual village-level of success the to key A poor the for benefits ensure thereby and funds, aid and mutual the loans in interested getting less them villagers make rich of cost the increase automatically measures these All cooperatives. credit local from loans of those than lower not are rates interest Fourthly, installments. by Thirdly, loan. are first repayments Yuanthe RMB2,000 for than more not Secondly,reimbursement. future until them for pay to mobilized low,is limit borrowing the be would cadres village households, poor exceptionally those for unaffordable really is it If Yuan. RMB50 at generally low, of is poor the benefit for and fee membership the Firstly,poor. participation the the ensure to arrangements institutional certain made but village, the in anyone exclude not did funds aid mutual village, the in problems Toavoid alleviation andsustainabledevelopment. poverty of goal the dual the in realized have villages situation pilot the for present funds aid the mutual the county,from Judging remuneration. proper a received management the personnel and 100%, at stood return fund of rate The loans. granted been had assets least having members 20% of the group the in 82% to up and fund, aid mutual the from loans received had County Wangcang of villages pilot the in members association RMB150,000. only of size a with aid mutual the inception, its internal association hasnotonlyoperatedsmoothly, but basically achievedfinancial sustainability Since effective capacity. an management formed and areas structure some in governance established council and association aid mutual a training, and publicity, mobilization adequate County,Wangcang Sichuan. After in fund aid mutual village the is places. example some An in achieved were results Good villagers, local of welfare and especially impoverishedfamiliesandwomen. income the increase thus and peasants impoverished the by funds production learnt. of management availability the lessons improve autonomous to and villages some deprived aid in get organizations mutual up and set to designed countrywide, were aid areas programs mutual These the deprived extending other of aim into the model with program fund villages, pilot deprived scale for larger a funds aid provinces mutual 14 on in conducted Finance of Ministry the and Development and Poverty Alleviation of Office Group Leading Council State the 2006, In these of effectiveness and funds. targeting the improving of aim the with alleviation, for poverty funds fiscal of management and use the to funds community of model the applying by villages deprived of number a in experiments fund have aid mutual village-level departments attempted fiscal and alleviation poverty local some years, recent In management problems. as well as policy financial by restrictions to due failure with ended all but 23 . In less than two years, 74% of the mutual aid aid mutual the of 74% years, two than less In . October, 2007. Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era” 79 Promote cooperation Promote cooperation in the field of financing within specialized cooperation organizations . 24 CPC Central Committee in 2008 and in the No. 1 Document of 2010 th Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage of November 2003, in order to raise the wholesale price of sheep, 5 peasant th member of Siping Municipal Banking Regulatory Bureau and an enthusiast for the course of rural cooperatives. member of Siping Municipal Banking Regulatory Bureau and an enthusiast for the course The key figure who directed and advanced the development of Baixin Aid Mutual Fund Cooperative in Lishu County was Jiang Bolin, staff households from Commune no.9 of Yanjia Village, Yangshutai Township of Lishu County, of Lishu County, Township Yangshutai households Village, from Commune no.9 of Yanjia Jilin Province, began selling sheep leading jointly, to a price increase of RMB0.6-1.0 per kilogram which amounted to extra RMB20-30 for each sheep sold. Later they established the Baixin Mutual Aid Fund Cooperative with the involvement and formulating preliminary helptransactional rules. of In the supporters,meantime, they had the opportunity to the volunteers, support agricultural Beijing-based by organized course training free a take main training contents of which were developing the cooperative economy, a guideline already included in central governmentpractical operation experience on improving the level of organization among peasants documents yet not widely carried out, and On the 10 But cooperation among farmers still faces difficulties in getting funds. Further promoting cooperation between farmers in the field of purchase financingand sale and onspecialized fieldsthe is importantbasis for solvingof the shortagecooperation of funds. in An established cooperative culture and an organizationalconsiderably base for lowercooperatives the may operational costs ofprofits from specializedmutual cooperation can better maintain the operationaid of mutual aid fund fund organizations, whereas organizations. Aid Jilin Baixin Village in Fund Mutual Lishu Cooperative County, of Yanjia Province, made initial attempts to promote a combination of husbandry cooperation, joint financing. purchase and sale, and cooperation in that peasants economic cooperative organizations should be encouraged tointernal mutual establishaid fund organizations in villages. This has considerable significance for cooperation between impoverished peasant households. As small numerouspeasants, but highlywho scattered,are can hardly secure a negotiating position in the market, profits from the agricultural industry chain are squeezed by the high prices of means of production and the low purchase prices of agricultural products. Promoting cooperation subject a become they that so organized them have to intended is peasants small among with a particular negotiating position in the purchase market,prices of wherebymeans of havingproduction andaccess higher toprices lowerof agricultural thus increase profit margins in the market. products can 24 The central government has indicatedSession of the 17 both in the document of the Third Plenary 3.3.2 Integration of specialized cooperation and mutual aid fund specialized cooperation and mutual 3.3.2 Integration of of loan and in the long run such a small-sized financialits organizationown canoperational hardly costs. cover It is therefore necessary to morecarry profitableout agriculturalfurther productioncooperation sectorsin such as purchase and sale, and processing circulation, in combination with the cooperative foundation formed by the mutual aid association. Observing that the 5 households’ joint householdsselling increased wanted income tosubstantially, join otherthe cooperative cooperative.swelled gradually, with a sheep Asstock of amore than result,300 in 2004. But thewhen theybreeding wanted to scaleexpand cooperationof theto purchase agriculturalproduction materialscosts, so theyas metto withlower a problem: almostdifficulties and hadall no access toparticipants borrowing Shortages money. of cash some hadwere always financially in bought agricultural production materials on tally at high prices to maintain production. So there emerged the need for a mutual aid fund. Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” TWO institutional guarantees promotion and lacks thestate’s multi-level cooperation comprehensive and At present,real 80 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy process ofexplorationandpractice. the absence of state-level promotion and institutional guarantees. This will be a long-term to enabling due established, be to really yet have income stable a earn organizations and risks diversify to peasants cooperation multi-level and comprehensive achieved, results positive certain with cooperation, sales and purchase and cooperation financial as such fields in examples useful provided have experiments of sorts different Although grass-roots can related economicsectors. policies agriculture- in operations scale preferential from profits the of share diverse a have effectively cooperatives with systems assistance agricultural countrywide and regional promotes state the if only countries, Asian East in agricultural assistance comprehensive of experiences the on Based value. added high of sectors poor of income economic agriculture-related these in agricultural participate to organized the be must they households, increase truly To etc. retailing, logistics, production, products processing, agricultural are chain agricultural agricultural from the in sectors returns profitable really increasing the because in role limited a has cooperation sale and organizations purchase in peasants small of power negotiating improved The Source: Center for Rural Reconstruction, Renmin University of China. of University Renmin Reconstruction, Rural for Center Source: reference fornationalmacroeconomicpolicyadjustment. valuable creating cooperation, financial experiences for rural civil mutual fund organizations. Theyto have provided an important moved cooperation sales organization, and cooperation purchase Mutual from grass-roots Baixin typical a evolvement, as system Cooperative, and Fund Aid innovation organizational of years After under theChinaBankingRegulatoryCommission. rate registered officially interest organization financial cooperative and peasants village-level first the prevention risk management, determination, and gradually formed relatively sound mechanisms. In 2007, it became operational the governance, to on as explorations mechanisms useful made Cooperative Fund circumstances, such Mutual In Baixin repayment. delay would none and awareness strong have of repayment then needs would the members efficiency, met high and cooperative service good the with as members long as that concluded then members The arrears. in one no almost with record, credit good a kept members cooperative the of most members, rural between relations geographical or blood of ties the of Because rules lending and borrowing among thefarmershasspreadseedofanew“ruralcooperativefinance”. fund with shortages meet to financing, surplus financial allocating of form in organizational This formulated. cooperation internal this institutionalized then villagers the attempts, some After costs. purchase and prices material lower those to order together,in materials help production purchase to money to little with conditions favorable in villagers persuading cooperation, financial of idea the with up came then They shortage. substantial had nor all at money no had rest the and themselves, problems their solve to able were basically them of third one and surplus, a with materials production agricultural buy to money had villagers of the third one that experience sale and purchase joint their in found Province, Jilin of County YushutaiLishu YanjiaTownshipVillage, of in members cooperative core The Box 4:BaixinMutual Aid FundCooperativeStartingfromJointPurchaseandSale Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era” 81 National Congress of the CPC and the development goal of a th CPC Central Committee, requires the antipoverty strategy to keep th Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage many problems emerge for extending rural governance, due to the outflow of In the long run, therefore, the antipoverty effort for the new period should on be the adjusted traditional basis of promoting growth in economic income. It much shouldas possible in changethe direction of as meeting the diverse needs of the disadvantaged for maintaining basic subsistence and of sustainable agricultural and Additionally,rural development. it should specifically include as goals of the rural poverty alleviation abreast of times and consider how to reflect the rural diversity and agricultural versatility of an ecological civilization. Furthermore, this should be regarded as the guiding principle to comprehensively summarize experiences and strategies. lessons from previous antipoverty A A new feature of the poor disadvantagedpopulation groupsis thatlike theit elderlyis strategy is confronted with the diverse needs increasinglyof underdeveloped areas and impoverished and women. Incomposed view of of this,rural households. the antipoverty The idea of Governmentmultifunctional Document of 2007, and particularly agriculturethe concept of advocated ecological by the raised17 civilization in the No. 1 Central 4.1 Long-term Strategy To To sum up, the organic combinationalleviation in the ofnew period will, in ruralan overall adverse situation in governancewhich rural economic and sustainableresources tend to povertydiminish in an irreversible way, play an active roleconversion in promotingof therural grass-roots social resources into socialcapital is used as capital.a carrier to connect Aswith the investment longof external capital, the asgoal of social will ultimately be realized. effort achieving universal benefits from the anti-poverty rural social ecology. and the wreckage of rural resources, the disorganization of peasants Thus, the improvement of rural governancefor realizingis aagricultural comprehensive sustainability, re-organization systematic of peasant projecthouseholds reconstruction and of the rural social and cultural ecology. Such a systematic concerted efforts made at projectmultiple levels medium-term like policy long-term and strategy, requires near-term operation. However, However, 4. Policy Suggestions Since the advance of poverty alleviation efforts in the new period targeting the rural disadvantaged largest groups is restrained to a certain degree by the current unbalanced state of rural governance, the emphasis of thestage should be put on povertythe improvement of rural governance in deprived areas, alleviationrealizing effort for the next reduction on the basis of sound rural governance. sustainable poverty If poverty alleviation efforts cana continuousmake a breakthroughdevelopment inof thisthecooperation regardamongpoor them, it andon will theachieveprovide an basisextremely valuable of example worsening improving plight of to agriculture, rural areas relieve and the peasantry in the thecontext of resources comprehensive outflow, and genuinely implement the balanced urbanand rural development advocated by the central government. “resource-saving and environmentally-friendly agriculture” proposed by the Third Plenary Session of the 17 Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” TWO 82 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy the needs of rural areas for sustainable development of ecology and environmental environmental and and life ecology of cultural protection. development as sustainable such for needs areas rural social of needs meeting the as well as governance, related supportive and disadvantaged the of organization of extent the in improvement the policy problem of elite capture is prevalent in the process of development of co-operatives. co-operatives. of development of process the in prevalent is capture elite of the problem Furthermore, resources. human cooperation of of capitalization from stage returns low initial their the of at because costs organizational major the afford cannot They of resources. natural and human levels of stocks lower have generally communities, deprived and elderly the organizational and women the mainly disadvantaged, improve The to households. peasant and impoverished resources, of stocks lower have areas deprived in disadvantaged the that problem new community the to geared innovation promoting organizational at aimed directly be should efforts level, operation specific a At 4.3 Short-termOperations cooperatives inareaswithconditionsfavorableforinter-village cooperation. financial economic of development the promoting and revenues; fiscal from organizations finance cooperative peasants’ of development organizations, the encourage to policies related this Specifically, includes: lifting various policy restrictions on peasants’ cooperation in finance; introducing cooperation. financial in groups disadvantaged of conducive and participation the mechanisms IVDP to or of policies up course set the and in development, of cooperative cooperation fund security mutual financial and rural coverage the strengthen to should we consideration funds, full giving of basis the on Secondly, sustainability ofpovertyalleviationperformance. the guarantee can we means these Through activities. cultural and social in participation extensive through mechanism supervision internal an form also can we but means, a as cooperatives comprehensive with effectively more cooperate and rural costs reduce we can supportive only Not a organizations. social of diverse developing of basis the on formation structure governance the promote then and cooperatives; community multifunctional and comprehensive in disadvantaged the of organizations participation broad cultural the and with social of development the promote and support to policies preferential more use disadvantaged; rural the for organization improved achieving those for in investment IVDP of diversity necessary expenditure cultural and social the increasing programs, the planned with villages strengthen to continue should we Firstly, For thisreason,weproposethefollowingpolicysuggestions: it by realized be only can being basedonbotheconomicandsocialfoundations. structure supportive a with governance Rural rural of governance. development the for foundation social a lay also will organizations social rural of development the and governance, rural of development the for foundation an economic laid have efforts alleviation poverty Previous governance. rural of improvement the including actively to shift should policy alleviation poverty the governance, rural to related closely are elderly, the and women groups, disadvantaged most currently the of needs subsistence diverse the and areas deprived in development sustainable rural the Since 4.2 Medium-termPolicy injecting a certain amount of seed capital into peasant’s cooperative cooperative peasant’s into capital seed of amount certain a injecting Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era” 83 enhance our experiences Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage in assisting disadvantaged groups to cooperatives. establish comprehensive and multifunctional Therefore, efforts should start in areas such as cultural and social life in which women and the elderly are able to getsocial organizationsinvolved which may at lower a transactionlow costs cost.and achieve Doingsupervisioneffective internalso by canextensive help participation to formof disadvantagedwill then be established groups.on which A supportive socialgovernance can be foundation built. When conditions become mature, efforts should be made to further advance mutual aid and cooperation to order in finance, and sale, and purchase production, in groups disadvantaged amongst achieve dispersion of risk and stable returns on the basis of comprehensive cooperation, and thus consolidate the foundation for sustainable development. From the practice that has emerged throughout China, we can see that this type of multifunctional cooperative which has both social, cultural, and cooperative functions, can maintain the process of increasing peasant’s profit and effective internal supervision. Thus, we should continue our explorations in this direction, at the operation level, and Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” TWO 28 27 26 25 For this particular criticism, see Emanuela Galasso and Martin Ravallion, “Decentralised Targeting of an Anti-Poverty Program”, Targetingan Anti-Poverty “Decentralised of Ravallion, Martin and Galasso Emanuela see criticism, particular this For see programmes, reduction poverty in targeting of benefits the of summary useful a For For examples of this, see John Weiss, “Experiences with Poverty Targeting in Asia”, in Asia”, Targetingin Poverty with “Experiences Weiss, John see this, of examples For On this issue, see Jonathan Conning and Michael Kevane, “Community based Targeting Mechanisms for Social Safety Nets: A Critical Critical A Nets: Safety Social for Mechanisms Targeting based “Community Kevane, Michael and Conning Jonathan see issue, this On Public Economics, 2003. Economics, Public Indonesia, People’s Republic of China, the Philippines and Thailand and Philippines the China, of Republic People’s Indonesia, Poverty Targeting Poverty Review”, 84 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy World Development World , OperationsEvaluationDepartment, Asian Development Bank,Manila,2006. , Vol.30 (no.3),pp375-394,2002. International Experiencesin Appendix Three strategies for poor households poor for strategies reduction poverty appropriate implementing and devising from and benefits; households these capturing non-poor prevent households; these reach benefits appropriate that ensure households; poor of types different identify to: essential is targeting that argued been has targeting it on targeting, of support In internationally programmes. reduction poverty discussions within mechanisms substantial and extensive been have There 1. Targeting poor; targeting in participatory programmes often results in elites capturing the benefits the capturing elites in results often programmes participatory in targeting poor; locally inequality worsening thereby corruption, by characterised is often targeting decentralised health care and possession of alternative sets of clothing. of sets alternative of possession and Additionally,care health were villages poor of classification a using targeting to access patterns, consumption food of basis the on devised categories on into households based is subsidies food of receipt Indonesia, In was this and households, poor implemented viatheuseofidentificationcards. identifying for responsibility given were State governments durables. consumer and livestock of ownership of and access number and land conditions, earners, family housing unreliable notably were adopted, were estimates criteria Income additional so subsidies. uncertain, additional and food of receipt for households poor identify to aimed targeting 1990s, late the in stage, early an at India, In For success: of degree some with it example: adopted have rigorous countries more This of enabling number A countries. results, targeting. some significant in and detailed recently more produce introduced can been approach has this and more approach, much a is rigorous characteristics) household and levels (allowing consumption surveys between household linkages from data with this combining and poverty Using techniques, region. mapping or area, village, particular a in incomes average of to estimates to measures needs indicators basic general from approximate varied indicators used These households. poor programmes identify reduction poverty most recently, Until context. learnt lessons the and areas Chinese current problem the for relevance some have may this above since years, recent in them about the of some on focus to important is It benefits itbrings. example:-targeting often fails to fully cover poor households For poor cover fully problems; to fails serious often example:-targeting contains inherently programmes reduction poverty in targeting Targeting of Poor households and Elite Capture of of Capture Elite and Poverty ReductionFunds households Poor of Targeting 28 . Looked at from this point of view, the costs of targeting can outweigh the the outweigh can targeting of costs the view, of point this from at Looked . , ADB, Manila,2004. 25 . Against this, many researchers have concluded that that concluded have researchers many this, Against . Rural Governance: Rural Pathways out of Poverty and the Effectiveness of of Effectiveness the and Poverty of out Pathways Poverty Targeting in Asia: Experiences in India, India, in Experiences Asia: in Targeting Poverty 26 ; benefits leak to the non- the to leak benefits ;

Journal of of Journal 27 ; Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era” 85 , Washington DC, 2003, p.71. , Washington , Special Operations Evaluation Study, Note on International ), and where it aims to promote sustainable Pathways out of Rural Poverty and the Effectiveness of Poverty Targeting , found that, even with accurate specification of poor households 29 Poverty and Inequality in Vietnam: Spatial Patterns and Geographic Determinants . 30 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Analysis by villagers of seasonal variances in these problem areas; Analysis by villagers of seasonal variances above-which are the poorest households and what are their specific needs, as a basis for targeting funding to these households. group of key informants; vulnerable (whether poverty gets worse under particular conditions); devise a list of specific poverty problems (lack of access to drinking water, poor housing housing poor water, drinking to access of (lack problems poverty specific of list a devise conditions, etc); Baulch, M. Epprecht, Evaluation Department, ADB, Manila, 2006. Evaluation Department, Vulnerability Issues: Villagers analyse factors making them relatively more or less Household Interviews: Interviews, particularly with poorest households, as a sample Analysis of poverty problems in village: Officials organise and facilitate villagers to Community Meetings or Village Representative Meetings: to decide-on the basis of the Asian Development Bank, Also, a detailed study of spatial patterns of poverty in Vietnam concluded that “most poor people live in less poor areas”. See N. Minot, B. Similar methods of participatory targeting countries havein recentbeen years. adoptedFor example: inIn India,a the smallDistrict numberPoverty (DPIP) Initiatives of examinedProject the use of participatory methods“Below the Poverty Line” (BPL) cards inin Gujarat, India’s second largest state. Confirming targeting for the distribution of assessments of the results of projects, the participatoryIndian project found that the use of participatory targeting greatly targetingimproved in Chinese programmes and • • • • development out A systematic of study poverty. of targeting of poor households in Asian countries by the ADB and poor communities, most projects evaluated did not focus on sustainable poverty exit but rather concentrated narrowly on channeling resources to poor regions or distributing subsidies to poor households. As a result, brought inonly limited benefitsmany such as short-termcases, training, subsidised farm inputstargeting or work of programmes on sub-project construction. These benefits achieved little to movepoverty in householdsthe long-run. Instead of outmeasuring the effectiveness of of targeting programmes by the number of poor that were lifted out of poverty justifiedsustainably, many projects inwere terms of the numbersomewhat telling-finding ofof this poorstudy was thatbeneficiaries many poor households actually “non-poor” areas reached.lived in An additional–and 29 30 Targeting has Targeting undoubtedly been most successful where it has been based on multi- dimensional poverty indicators (as outlined in detail in the In the Philippines, targeting for poverty schemes has been based upon a set of “unmet basic needs”–in terms of shelter, devised and implemented. were used, and poverty mapping participatory assessments health, education. Where data was unavailable, targeted on a scoring system based on a set of and population. housing including infrastructure, social and economic characteristics, • Use of participatory approaches in targeting hasyears, notably in the beenPoor Rural Communities Development developedProject (in Sichuan Yunnan, in China in recent and Guangxi) and by the Jiangxi Poverty Alleviation and Development Office Both (PADO). these cases have involved participation by village members, and member representatives in the process of targeting poor households. Based on evidence then by village from these projects, it is useful to summarize the main steps involved in targeting. These are outlined in the box below: Experiences with Multidimensional Poverty Rural Governance and Poverty Alleviation in the “Post Agricultural Tax Era” TWO 36 35 34 33 32 31 As one commentator aptly stated, enhancing participation does not necessarily “mitigate the opportunism of local leaders”, J-P Platteau, and Lewis, D. & Hossain, A, Hossain, & D. Lewis, Hossain, A, & D. Lewis, and Local at Governance and “Capture D., Mookerjee, P.,and Bardhan, and as such texts in detail some in summarised are points These TargetingBangladesh”, in from (PWR) Poor? Study Ranking AJ.F.Feulebackthe WealthCase Participatory M.Zeller, is “How and Accurate The DPIP survey was conducted in 2006, and covered 6000 households across 300 villages. The findings are presented in N.Kumar, N.Kumar, in presented are findings The villages. 300 across households 6000 covered and 2006, in conducted was survey DPIP The International Agricultural Research Agricultural International Belgium, 2004. Namur,Development, of Economics the in Research for Centre F.Gaspart, Development”, Community-Driven in Leaders Local “Disciplining (Sida), Stockholm:SidaStudiesNo. 22,2008. “Participatory Governance and Pro-Poor Targeting: Evidence from Central India”, Working Paper published by the by published Paper Working India”, Central from Targeting:Evidence Pro-Poor and Governance “Participatory (Sida), Stockholm: SidaStudiesNo.22,2008,p.33. National Levels”, Conference onInternational Agricultural ResearchforDevelopment,Göttingen,2005. 86 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy American Economic Review Economic American Understanding the Local Power Structure in Bangladesh in Structure Power Local the Understanding Understanding the Local Power Structure in Bangladesh in Structure Power Local the Understanding (CGIAR),InternationalFoodPolicyInstitute(IFRI),2008. processes, theirhigherlevelsofeducationalattainment,andprivilegednetworking within asymmetrical social positions in village communities, on their knowledge of political position privileged their on primarily resources, rests economic to access capture privileged retaining elite elites that on are assessments recent from conclusions main The with referencetorelevantcasestudyexperiences. together these, noting worthwhile is it Consequently, context. Chinese the for relevance some have suggested, remedies with together explanations, these of Some participation. of levels in improvements with along continues capture elite why explain to forward put the “counter-elite” approach suggests that community empowerment can be effective effective be can capacity, empowerment local community that building suggests by approach and power, “counter-elite” to the access in inequalities of awareness public accuracy in determining appropriate BPLappropriate determining recipients in accuracy many observers to conclude that the occurrence of elite capture cannot be reduced reduced be cannot decision-making. in capture participation of elite levels increasing of by led occurrence has the This that transparency. conclude to greater observers to many lead participatory not cases did many in implemented, but when realised, approaches, were improvements such cases, some In communities. local within available widely more becoming development of benefits of the to forms lead would equal more create would governance improved that and groups; vulnerable ownership and disadvantaged for of representation sense greater a that corruption; of levels in reduction a by accompanied be would leaders of election public increased and be would approaches these of transparency greater level-that local the at governance in improvements by accompanied use increasing the that assumed had many onwards, With participatory approaches to poverty reduction coming to the fore from the mid-1990s 2. TheProblemof“EliteCapture” 35 methods other with compared when poverty income absolute predicting in accurate exceptionally was rankings wealth participatory of use the via targeting participatory that found study approach advocates “challenging” elites by effectively excluding them in the design of of (2008) Hossain and Lewis by paper recent design a programmes. in reduction stated poverty As the in them excluding effectively by elites “challenging” advocates approach former The elites. “co-opting” or “countering” either of dichotomy, simplistic somewhat a on focused have often years recent in capture elite with dealing for Recommendations , elites are “obstacles to progress with poverty reduction development” reduction poverty with progress to “obstacles are elites , , Vol. 90,No.2,pp135-139,2000. 32 . . Swedish International Development Cooperation Agency Cooperation Development International Swedish . . Swedish International Development Cooperation Agency Development International Swedish .

31 . Similarly,. detailed a Bangladesh, in 33 Several reasons have been been have reasons Several Consultative Group on on Group Consultative 36 . By raising raising By . 34 . Rural Governance and Poverty Alleviation TWO in the “Post Agricultural Tax Era” 87 Journal of , Oxford University , July 2010. Journal of Public Economics, 2003. Voices of the Poor: Crying Out for Change Oxford University Press, New York, 2001. For the participatory Research Working Paper No. 2010/82 . Clearly, both these approaches . If the required time is not spent 38 . Elite capture of funds can also be 42 39 . As suggested above, in the section on 41 . In contrast, the “co-opt” approach suggests 37 . This conclusion is reinforced by further recent 43 Participation, from Tyranny to Transformation? Exploring New Approaches to Participation in . Rewarding local elites by publicising their successes 40 , Vol.39, No. 2, pp.104-36, (2002) , Vol.39, Attacking Poverty Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage , Zed Books, London, 2004. World Development Report 200/2001: Attacking Poverty, 44 18, Number 1, pp.27-41, 2010. Development, Namur, Belgium, 2004. Development, Namur, Belgium, 2004. for Research in the Economics of Development, Namur, Ghana”, United Nations World Institute for Development Economics, Institute Ghana”, United Nations World Press, New York, 2000. York, Press, New assessments prepared as the basis for this report, see D.Narayan et al, Development Studies Development See S.Hickey and G.Mohan (eds), World Bank, See Wong, Sam, “Elite Capture or Capture Elites? Lessons from the “Counter Elite” and Co-opt Elite Approaches in Bangladesh and See Platteau, and Abraham, J.P., A., “Participatory Development in the Presence of Endogenous Community Imperfections”, See Emanuela Galasso and Martin Ravallion, “Decentralised Targeting of an Anti-Poverty Program”, of an Targeting See Emanuela Galasso and Martin Ravallion, “Decentralised F. Cleaver F. and K. Harmada, “Good Water Governance and Gender Troubled Equality–A Relationship”, Gender and Development, Volume See J-P Platteau, and F. Gaspart, “Disciplining Local Leaders in Community-Driven Development”, Centre for Research in the Economics of Platteau, and F. See J-P For a presentation of these, see, eg J-P Platteau, Gaspart, and “Disciplining F. Local Leaders in Community-Driven Development”, Centre ensuring that representatives of poor households acquire real bargaining strength and organisational skills, genuine ownership by beneficiary groups is likely to remain elusive –as stressed repeatedly in the many 2000/1 participatoryWB Report, assessments undertaken for the studies, suggesting that elite capture is correlatedinequality. with relatively high levels of local targeting, the use of participatory monitoring and evaluation can act as a constraint on leakage of funds during the different stages of project genuine however, or and Ultimately, meaningful empowerment programmeis the most sustainable way implementation. of avoiding elite capture, as illustrated recently in a short overview of poverty reduction project implementation by Cleaver and Harmada 43 44 42 40 41 39 37 38 in countering domination by local elites regionally and nationally in controlling corruption, thereby giving them enhanced status, has brought successes in a number of cases More realistic strategies for addressing eliteways in whichcapture supportive elites mightactually assist wellin the focusdevelopment of on poverty assessingreduction programmes. Elites who achieve this appear to socialhave a structuredeeper understanding and of organisationthe ofelites. This villageswas illustrated recently, thanfor example, isin a thedetailed study caseof the of withintroductioncommunal solar lesslighting projects in benevolentBangladesh are somewhat simplistic, since most elites’ actions cannot be placed easily within each category; furthermore,” challenging” the authority of localundermine their influence, whilst “co-opting” them risks reinforcing power inequalities and elites does not necessarily worsening poverty. that co-operation with elites should be theplay a mainconstructive role solution,in community development since many elites actually addressed by sequential and conditional disbursement procedures, as highlighted in a recent detailed study by Platteau China’s Poverty Reduction Policies During the Process of Urban-Rural Integration THREE 46 45 farmers population andlandless population, left-behind a large number of floating urbanization hasformed forces intheprocessof mobility ofrurallabor Mass migrationand antipoverty effort challenges forfuture integration hassetgreat brought byurban-rural of “transitionalpoverty” However, theproblem reduction achievements inpoverty has gainedsignificant The ChineseGovernment Refer to Ravallion (2010). The exchange rate between US dollar and RMB was converted on the basis of the purchasing power parity in parity power purchasing the of basis the on converted was RMB and dollar US between rate exchange The (2010). Ravallion to Refer According to the official materials, China’s urbanization will keep a rapid pace in 15-20 years ahead. During the Twelfth Five-Year Plan Plan Five-Year Twelfth the During ahead. years 15-20 in pace rapid a keep will urbanization China’s materials, official the to According period (2011-2015), the urbanization level in China is expected to reach and go beyond 50% and the country becomes an urban society. urban an Please visithttp://www.askci.com/freereports/2010-03/201033071652.html. becomes country the and 50% beyond go and reach to expected is China in level urbanization the (2011-2015), period 2005. 88 THREE Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy Process ofUrban-RuralIntegration China’s Poverty ReductionPoliciesDuringthe the tendencyisexpectedtocontinueincoming15-20years mass This 2009. in million. 47% to 1990 in 26% from China’srate And increased urbanization has migration 150 about at estimated number, ever-increasing and is enormous an migration this from resulting population” “floating The 2009). Bank, (World history periods in peaceful in migration population largest the force be labor to rural considered its before, of never as migration mass a experienced has China years, 30 past the In in China advances integration urban-rural as foreground the to coming are groups Vulnerable (1) will clearly seethatnewchallengescomealongwiththeachievementsalreadygained. we poverty, into falling from prevent also but poverty “immediate” the solve to not only work antipoverty and welfare, basic in deficiency and rights of lack as such include factors which dimensions multiple in also but income in only not and as process “poverty” this consider account into taking by problem poverty China’s study we If China. in urbanization accelerating years 15-20 coming the in continue to expected is the and decades three past the in process with related closely is problem this i.e. integration, rural urban- of process the during developing poverty the from emerging are challenges New income groupsinruralareas. low- the targeted mainly and Government Chinese the of policy long-term a been has that relief” poverty “development-oriented the to thanks well-targeted and complete be allowance to seem living policies antipoverty China’s minimum and the country; the across under established being covered system adequately be will who 2004), (ADB), Bank Development (Asian subsistence of means basic or capacity labor normal lacking groups “chronic”-impoverished are China in remaining population impoverished absolute to 16.3% in 2005 in China and was much lower than that in India (41.6%) India in that than lower much was and China in 2005 in 16.3% to dropped sharply figure the while (59.8%); India in that than higher much 1981, in 84.0% as high as estimated was China in incidence poverty expenses, daily for US$1.25 at line poverty the achievements. Taking significant made has and areas urban and rural both in poverty eliminating to dedicated been has Government Chinese the 1980s’, the Since 1.1 Vulnerable groupsinurban-ruralintegrationprocess Poverty Transitional and Integration Urban-rural Introduction: 1. is used for other purposes, leading to a considerable number of landless farmers. rural farmers. landless landless contemporary the of of number estimates agreed unanimously considerable of a lack the to Despite leading purposes, other land for agricultural used more is of urbanization, of development acceleration rapid the the and of industries needs the nonagricultural meet to Furthermore, population. left-behind huge a in resulting cities, and towns in work to migrate laborers rural of number large A 46 . 45 . Most of the of Most . China’s Poverty Reduction Policies THREE During the Process of Urban-Rural Integration 89 New vulnerable groups New vulnerable are facing the deficiency net in subsistence safety The concept of antipoverty policy that has cut urban and rural areas apart is unable to stand the impact from urban-rural integration . So, resolving the issue of vulnerable group 47 ”. transitional poverty Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage RMB per year. According to the estimation of China Development Research Foundation (2010), cost for citizenlization for migrant workers needs 2 trillion Therefore, neither could China’s existing macro public policy and specialized antipoverty policy target the emerging vulnerableadopted in groups,China complete. Additionally, future policy norarrangements and is policy thechoices current will be a long-term and hard task. antipoverty policy is not only a long-term process but also a hard task. prioritise, and then resolve the issues step by step. It is a basic principle to identify, 47 The risk of impoverishment faced by vulnerable groups duringdiffers urban-ruralfrom integrationthe traditional risk of poverty resultingemerged during fromthe transitionlow process income.from urban-ruralThe separationformer to integrationhas which can thus be called “ 1.2 Transitional poverty and its features 1.2 Transitional Migration and urbanization in China will continue for a long period. Meanwhile, because of the constraints of economicelimination developmentof the urban-rural and separationhistorical policies inin China social is a factors,long-term servicesprocess andthe special complete anti-poverty (4) The above-mentioned issues for vulnerable groups have long-term and characteristics. formidable A A range of policies in China have been designed separately for rural andand urbanfor areas rural and urban residents, and so have the Chinese Though rural-urban integration. of impact counter the cannot therefore which the long-adopted antipoverty policies Government has in recent years developed many policies andsubsistence safety measuresnet for urban toand rural buildresidents, the thecurrent problem lies in the fact that such a net is cut into two parts respectively for urban and rural areas, instead of an effectively connected “net” planned as a whole. This is the major cause groupsfor vulnerable uncovered by this net and obviouslyeconomic integration. lags behind the process of urban-rural (3) China’s long-adopted social service policies and specialized antipoverty policy have been based on a concept that divides urban and rural areas and isolates urban residents from their rural counterparts, which therefore are unable to stand the impact of urban- rural integration. In the process of urban-rural integration vulnerable groups have to face the inadequacies of the subsistence safety net. Although their income line,may be theyhigher arethan exposedthe poverty to personal,to employment,deficiencies developmentin the andsubsistence other major feature of “vulnerability”. institutions, hence their riskssafety due net caused by drawbacks of policies and (2) As a result of non-existent or imperfect policies and systems vulnerable groups face the risk of impoverishment caused by unequal rights and inadequate measures for risk control and transfer population, population, many experts think that there were at least 40-50 million landless or partially landless farmers in China before 2005 (Han Jun, 2005). Unfortunately, this number will in China. as urbanization increases keep increasing undoubtedly China’s Poverty Reduction Policies During the Process of Urban-Rural Integration THREE wider antipovertysystem vulnerable groupsanda view andcoversallthe a multidimensional is establishedfrom for transitionalpoverty The researchframework social transition during theperiodof and changingsituations shall cater to the dynamic China’s antipovertytasks policies results mainlyfrom multidimensional. It and isalso vulnerability, defined byits Transitional povertyis 90 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy vulnerability. • limited their to due poverty into capacity torespondrisk.Furthermore,thecausesoftransitionalpovertyareuncertain. fall may them of some only contrary, the on poverty; rural residents. and urban both for system antipoverty coordinated and complete a up set consequently and services, public basic for opportunities, guarantees and achievements development employment share to equal right including transition, with social of deal to period rights the and during risks capacities basic with them equip to as so poverty, into falling transitional from groups vulnerable prevent can that net safety subsistence a establish existing for challenges and tasks new policy.antipoverty should policy relief poverty specialized setting and policy service social Macro and testing constantly context, social ever-changing and dynamic a into work antipoverty China’s of tasks and issues the put have integration urban-rural related and urbanization migration, population word, one In for solvingtheproblemoftransitionalpoverty. crucial is integration urban-rural of period transitional the for system policy the improving this, Given impoverishment. of risks various with adequately deal to unable these are groups integration, urban-rural of period transitional the during groups vulnerable effectively cover doesn’t system policy the Since areas. rural from urban of divided have all which policies, antipoverty specialized and polices service public the of system, policy failure macro the from mainly resulted has poverty Transitional individuals. of vulnerable inability the from than rather system, policy the in defects in lies poverty transitional • “Transitional poverty”hasthefollowingfeatures: areas and thus must be improved to counter the challenges brought with urban-rural urban-rural with brought integration. challenges The researchframeworkisshowninFig.7. the counter to improved be must thus these and in areas residents and core areas urban the and and rural as for system separately taken designed antipoverty are is which current policy the from integration starts research the urban-rural and variable research, exogenous this analyze In and poverty. investigate to needed is transitional framework research a purpose, above the For the in integration urban-rural coming 10years. of background the against policy antipoverty China’s to adjustments possible proposes and urbanization, of acceleration the and laborers rural of poverty system in relation to urban-rural integration, especially as a result of the migration This chapter examines the challenges facing China’s current poverty reduction policy and poverty transitional analyzing and investigating for framework Research 1.3 • equal rightstopublicservices,orsuffer frominsufficientopportunitiesfordevelopment. of deprived or society from excluded be also may They incomes. low have necessarily Groups suffering transitional poverty are often difficult to define and their major risk is is risk major their and define to difficult often are poverty transitional suffering Groups Transitional poverty is multidimensional. is poverty Transitional Transitional poverty is the result of policies rather than being chronic. being than rather policies of result the is poverty Transitional Not all vulnerable groups in urban-rural integration suffer from transitional transitional from suffer integration urban-rural in groups vulnerable all Not Groups trapped in transitional poverty do not do poverty transitional in trapped Groups The cause of of cause The China’s Poverty Reduction Policies THREE During the Process of Urban-Rural Integration 91 The vulnerable groups in the transitional period include… Migrant workers: size, distribution and risks of transition poverty as measured 48 Rural area/ rural residents Rural antipoverty system and policy n Urban-rural integration Urban-rural obile/landless/left-behind populatio obile/landless/left-behind Fig. 7: Research framework Fig. 7: Research Policy convergence and adjustment? and convergence Policy M y Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Urban area/ urban residents Rural antipoverty sytem and polic government’s specialized anti-poverty policy, but more importantly, various public service policies that may impact the potential risks of development for urban-rural integration. groups during the economic transition and vulnerable risks of development because of urban-rural separation or lack serviceof primary policiespublic in the present economicinstead of only the low-income group; transition and urban-rural integration, by the income index; instead, it becomes a multidimensional one that also exists in development capacities and opportunities; Accordingly, the anti-poverty system under analysis will include not only the The issue of poverty no longer or mainly refers to absolute poverty Therefore, the objects of analysis will include all vulnerable groups that face various • • • cover all the absolutely poor population. The Chinese Government has begun since 2007 to establish step by step a nationwide minimum living allowance system in rural areas, to 48 According to the statistics issued by theSurvey underDepartment the Nationalof BureauRural of SocialStatistics of and China Economic(NBS) rural migrant workers (2010),reached 230 million in the 2009, among which numberout-going rural workers of (1) Size 2.1.1 Floating rural population (migrant workers) The vulnerable groups emergingimpoverishment risks include migrant workers who duringwork in cities but have urban-ruralno adequate insurance of unemployment,integration work injury, diseases and pension. Landless andfarmers who exposedhave no equal accesses to land appreciation benefitsto and not covered by social security system, left-behind children and the elderly who need care from their parents or children, and women who are informally employed and whose rights and protected. interests are not well 2.1 Vulnerable groups in China’s transition integration period of urban-rural 2. Transitional poverty: issues and challenges poverty: issues and 2. Transitional With the knowledge of the context and causes of transitional the poverty, analysis made follows the three principles below: on the basis of this research framework China’s Poverty Reduction Policies During the Process of Urban-Rural Integration THREE 49 workers the femalemigrantrural Specific risks confronting According to National Bureau of Statistics of China, going-out migrant workers are referred to as the migrant workers who leave home for home leave who workers migrant the as to referred are workers migrant going-out China, of Statistics of Bureau National to According work for more than 6 months; the number of migrant workers for a year is consisted of that of going-out migrant workers plus that of local of migrant workers who areemployedbythelocalnonagricultural industriesformore than6months. that plus workers migrant going-out of that of consisted is year a for workers migrant of number the months; 6 than more for work 92 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy • instability ofmigrantworkers. changing of economic situations. This process willresult further complicate and exacerbate the employment a as the areas is rural to there urban since from back areas, move to urban migrants to for possibility rural from flow unidirectional a simply there longer no integration, is rural-urban of process ongoing the In 2010). Survey, Economic and Social Rural of Department (NBS week per hours 60 than more worked industry catering the in those and Law; Labor the by prescribed week per hours 44 over worked them of 89.9% units; employing or employers their with contracts labor signed workers migrant • Migrant workersarevulnerabletothefollowingrisks: (3) Risksoftransitionalpoverty in largeandmiddle-sizedcitiesabovetheprefecturallevel. worked 63.3% and workers; migrant all the of 62.5% for accounting 2009, in China East workers. migrant rural all of 68.1% to went workers rural million 90.76 destinations, for As Western and Central from for accounting and 2009, in respectively million workers 45.924 and million 53.045 from ranged China Social migrant of Rural of number the Department (2010), NBS Survey by Economic issued statistics to According cities. sized middle- and large in China, Eastern in are places receiving the and areas, western and central the in areas rural in mainly are migrate workers which from places the China, In (2) Distribution will reachabout400million(ChinaDevelopmentResearchFoundation,2010) were about 150 million 150 about were • of RuralSocialandEconomicSurvey, 2010). Department (NBS part eastern the in that than lower significantly was parts western and central the in workers migrant by rural insured of proportion the and paid respectively; 2.3% and insurance maternity 3.9% 12.2%, and 21.8%, 7.6%, were workers migrant rural for units employing or unemployment employers medical, injury, work and pension the maternal medical expenses , and as many as 64.5% gave no salaries to female female to salaries no gave 64.5% as reimbursed many 12.8% as and only , expenses workers, medical migrant maternal female the their for leave maternity lawful full allowed units employing 36.4% only 2006, in (2007), Children and and Women of Rights Interests the Safeguarding for Group Coordination National the by launched survey • in poverty intergenerational cause migrant workers. will thus and groups, two the between wider even grow may gap the cities, in living children for that with compared children workers’ rural • than eliminate to difficult more those attheinstitutionallevel. be and longer conceptual, exist in may also exclusion and but discrimination inequalities, institutional and Yong,social (Xu Deep-rooted exclusion 2006). and prejudices cultural and psychological legal in only not reflected is Unstable employment and heavy workload. heavy and employment Unstable Danger of intergenerational poverty. intergenerational of Danger Inadequate guarantees of medical care and personal safety. personal and care medical of guarantees Inadequate Specific risks faced by female migrant workers. migrant female by faced risks Specific Social exclusion. Social Practically speaking, discrimination against migrant workers workers migrant against discrimination speaking, Practically 49 . It is estimated that the population of migrant workers in 2030 2030 in workers migrant of population the that estimated is It . Due to the unequal right to education for migrant for education to right unequal the to Due As is shown in a 2009 survey, only 42.8% survey,only 2009 a in shown is As According to the comprehensive comprehensive the to According In 2009, the rates of of rates the 2009, In China’s Poverty Reduction Policies THREE During the Process of Urban-Rural Integration 93 Left-behind population: size, distribution and risks of transitional poverty Landless farmers: size, distribution and risks of transitional poverty Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage The Left-behind populationThough mainlymigration has longconsists been an importantof means thetoit unavoidablyincrease elderly, has ruralsome labornegative impactschildrenincome, on the places of andorigin (World including: women.Bank,adverse influence on2009), the educational attainment of rural youth, vulnerability of migrant rural workers caused by their industrial injury or disabilities, issues of left-behind elderly, and a weakened cohesion and collective participation in rural areas. It is that likelythe number of left-behind will increase further because of the increasing number of migrant workers. 2.1.3 The Left-behind population • Lost social capital. The social protection system consisting of relatives, neighbors and family or community members is destroyed when land is requisitioned.lost both their Farmersland and havesocial capital. A survey shows that 48% of interviewed landless Xiaohui, Zhang Haibo, 2006). farmers did not view themselves as urban residents. (Yu • Inadequate social security system. Only a small number of landless farmers can enjoy social security similar to that of urban residents. Landless farmers are nor neitherurban residents, and have become a marginalized group, living awkwardly in a social farmers security vacuum • Risks from unemployment and declining incomes. Some landless farmers are in inferior positions in relation to job seeking, and quite a number of them are even unemployed or semi-employed, due to their lacking nonagricultural skills. Some surveys show that the transition to new professions is the biggest problem confronting landless farmers,the unemployment andrates for the elderly who can least adapt to new economic situations and those who have no professional Council, 2009). Development Research Center of the State skills have increased (Research Team under (3) Risks of transitional poverty Landless farmers in China are mainly found on the outskirts around large and middle- sized cities and in economically developed areas. It is estimated that landless farmersin Zhejiang, Jiangsu, Fujian, Guangdong and Shandong provinces comprise 41% of all requisitioned been has land of mu million 1.44 about years, 20 recent In farmers. landless in Shanghai, leaving more than one million farmers from 1993 to 2005 (Han Jun, 2005). landless farmers in Beijing reached 330,000 landless in total. The number of (2) Distribution There is no authoritative data available for the number of landless farmersMost at researcherspresent. estimate that the number of landless and reachedpartially 40-50 landlessmillion farmersby 2005 (Han Jun, 2005). This number isin the expectedfuture. It to is increase estimated that population of landless farmers will reach 100 million in 2009). Center, 2020 (China Democracy Progress Party (1) Size 2.1.2 Landless farmers employees for their maternity leave; and 58.2% of female migrant rural workers had to go to had workers rural migrant female of 58.2% and leave; maternity their for employees back to their villages, rather than the city where they worked, for regular checks during which pregnancy, created difficulties for them and increased their economic burden and employment problems; 46.3% of the surveyed female migrant often felt workersexhausted both said physically and thatpsychologically, 18 percentage they points and 11.5 rural women respectively. rural workers and male for than those percentage points higher China’s Poverty Reduction Policies During the Process of Urban-Rural Integration THREE 50 Huge scale period… groups inthetransition Feature ofvulnerable These figures are quoted from Department of Children’s Work under China Women’s Federation (2008), Ye Jingzhong et al. (2008) and and (2008) al. et Jingzhong (2008), Ye Federation Women’s China under Work Children’s of Department from quoted are figures These http://cpc.people.com.cn (2008),respectively. 94 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy elderly enjoy social endowment insurance (Ye Jingzhong et al., 2008). This situation situation This 2008). al., cannot beimproveduntilthenewpensionschemeislaunchedinallruralareas. et Jingzhong (Ye left-behind insurance of 1% endowment as social few as enjoy and elderly government, the by provided subsidies or provision received have 8% only and production agricultural in involved are elderly left-behind the Bank on the basis of the new poverty line (8%, World Bank, 2009), and assuming that that assuming and 2009), Bank, World (8%, line poverty new the of basis the on Bank World the by population floating the within incidence poverty of estimates to According groups risks. these various by affected in be may however,they poverty; people transitional into fall the to likely all are not course, Of years. coming the in increase expected further is to figure The population. left-behind 40-50 million 130 workers), and rural farmers (migrant landless million population floating million 150 about including million, rural areas in China in areas rural in behind left women million 47 and 65, above elderly million 58 20 nearly about children, are million there that of agreed been groups generally three has it However, above-mentioned population. the left-behind of number authoritative or precise no is There (1) Size • period inChina: transition the in groups vulnerable of features particular discern can we above, the From 2.1.4 Summary • These threegroupsarefacingsimilaryetdifferentiated risksfromtransitionalpoverty. (3) Risksoftransitionalpoverty rural Western and Central in areas ofChinawhicharesourceformostmigrantruralworkers. concentrated is population left-behind The jobs. for out going farmers of tide the with along emerged has population left-behind the of issue The (2) Distribution population. • cultural public of shortage and children facilities andactivitiesinruralcommunities(Yetheir Jingzhongetal.,2008). of absence the to due depression, and under live left-behind stress by affected divorce are and lonely feel often elderly third one about while pressure, psychological the increasing of half sharply nearly a to 2009); leads which (http://cpc.people.com.cn, rate husbands, their of absence the to due emotion, their release to outlets find cannot women left-behind some 2008); Federation, Women’s All-China under Work Children’s of (Department employment for out go who parents from care reduced to due children, rural other than pressure psychological and • helpless, facinghugemedicalexpenses(http://cpc.people.com.cn,2009). sit often they ill, falling when hand, other the on while health; their harming severely thus and agricultural women left-behind in for intensity role labor high in resulting increased Yan,2008), (Zhen production markedly a their play from females care ill; proper become they receive once cannot children them of most and workloads, heavy and care Inadequate old-age insurance system. insurance old-age Inadequate Psychological problems. Psychological Huge scale. scale. Huge Health risks. Health Many of the elderly left behind are in poor health, living with insufficient insufficient with living health, poor in are behind left elderly the of Many The number of the vulnerable groups is estimated roughly at around 330 around at roughly estimated is groups vulnerable the of number The 50 . The total figure is 125 million, equal to that of the rural floating floating rural the of that to equal million, 125 is figure total The . Many left-behind children endure more severe mental conflict mental severe more endure children left-behind Many It has been estimated from surveys that 81% of 81% that surveys from estimated been has It China’s Poverty Reduction Policies THREE During the Process of Urban-Rural Integration 95 Geographic features of Geographic distribution resulted Impoverishment from policies non- Multidimensional income poverty More severe poverty for women The policies affecting the vulnerable groups… The developing pattern of urban-rural integration that cannot allow the sharing of the benefits of development. As As distinct At present, the floating population Policy factors that lead to transitional Both migrant women workers and left-behind Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Distribution is a significant geographical feature. Impoverishment resulting from above policies. Poverty for women is significantly severe. Vulnerable groups are confronted with multidimensional non-income poverty. • from traditional poverty caused by low income, vulnerablehave groupslow incomes.do not Nevertheless,necessarily they are likely discrimination in rights, social exclusion and other toareas of multidimensional non-income, fall into spiritual impoverishment, service systems. due to the lagging-behind of policy and Though discrimination against migrant rural workers in urban markets has been eased to some extent in recent years, there are stillregulations supposed quite to aprotect migrantnumber workers of from defectssuch discrimination in (Lin Yanling, laws and governments, local by residents local for interests of protection the under Besides, 2007). migrant workers are faced with institutional residents. local of those from different systemsquite are which children, for education and security for employment benefits, social • Discriminatory employment registration system and benefit schemes accompanying the household Urban-rural integration in turn results However, the currentfrom, development mode andof urban-ruralincreases integration in China economiccan hardly development.allow the floating population and landless farmers to share these development benefits, and This thus feature weakens their capacities to counter the risks of transitional poverty. can be seen in the following aspects: (1) Non-inclusive urban and rural integration pattern 2.2.1 Non-inclusive urban vulnerable groups to cope with the risks of poverty and rural integration lowers the capability of This chapter investigates not only the specializedthe Chinese povertyGovernment, but reliefalso a policieswider range adoptedof policies by that opportunities and capacities havefor development of vulnerable groups impactsduring the urban-rural on the integration process. These macro as well as micro policies include: developing a mode of urban-rural integration that does not allow a sharing of the benefits of development,urban-rural dual-structured public service systems, financial support policies and lackingcomprehensive specialized understanding separate of poverty poverty, relief policies a for urban and rural areas. 2.2 Defects in the current groups transitional poverty for vulnerable policy system increase the risks of • the poverty incidence of landless farmers and left-behind population are the same, the poor population in these vulnerable groups will reach 26.4 million, viewed solely from the of income poverty. perspective • and landless farmers are located mainly in the southeast coastal regions, while the left- China. and Western concentrated in the rural areas in Central behind population is women are facing more severe problems such as deprivation of rights, hardshipsmental health,in daily life and sanitation and health. These issues women’s well-being areand intergenerational significanthence poverty, special attention for must be both paid to them. • poverty include an incomplete from urbanization. and lack of inclusive benefits discrimination in employment social security system, inadequate medical care, China’s Poverty Reduction Policies During the Process of Urban-Rural Integration THREE poverty reduction policy outcomesof to achievetheexpected gap and disadvantageous the rural-urbanincome rural integrationenlarges Non-inclusive Urban- 96 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy relation with the huge benefits accruing after land requisition (Research Team under under Team (Research requisition land after accruing benefits huge the with relation direct no has farmers by received compensation the Additionally, benefits. appreciation land long-term substantial the against set by when low,received proportionately is compensation farmers landless land profit revenue, fiscal transfer local of land part large although quite a shown, for have accounts surveys As group. this of vulnerability the easing for disadvantageous very are and integration, urban-rural of achievements the in share household to population the floating the of ability accompanying the weakens system undoubtedly system registration benefits and employment discriminatory The (2) Consequencesofthenon-inclusiveurbanization 30% tovillage-levelorganizations,andonly5%-10%farmers. from arising 25%- enterprises, to benefits 40%-50% governments, of local to distributed 20%-30% are land (2005), requisitioned of Team China of Survey Statistics Economic of of Rural Bureau the Institute National and the Sciences Development Social Rural of the by Academy obviously is Chinese jointly the farmers released to data to requisition the According during irrational. benefits of distribution the Secondly, obtainable fromthenonagriculturalusesofland. profits high the share and gain to way no have China. farmers in Thus, trading for market the into enter directly to allowed not is currently land collectively-owned rural all, of First in urbanization during benefits China issomewhatunfair. appreciation land of distribution current the However, the risksoftransitionalpoverty. to exposed less be and urbanization of achievements the share to able been have still would farmers landless requisitioned, is land whose farmers to given is compensation full if even urbanization; by brought benefits appreciation land the enjoyed have would use land of right with farmers market, land the into entered directly land collectively-owned rural Had land. collectively-owned rural substantial require industries nonagricultural of development the and towns and cities of expansion the integration, urban-rural During adequately not are land contract who protected duringchangesinlandownership. farmers of rights the time, same the At rights. legal different have land state-owned and land collectively-owned Therefore, purposes. nonagricultural for used is and market land the into enters it before state-owned become to requisitioned be must latter The land. collectively-owned rural as or land state-owned urban as either classified is China in right property land laws, existing in prescribed As • Unfairdistributionoflandappreciationbenefitsduringtheurbanizationprocess integration. buy urban-rural over they urbanization” if “elite of only shadow a cities cast has in This places. these register in houses can workers migrant example, for small-sized towns; and and middle- in cities register to workers migrant for preconditions still are there Furthermore, cities. mega and large in work to tend workers rural migrant most as cities, in working of workers rural to costs the reduce to failed has reform However,for this towns. restrictions some lifted and cities has small-sized and middle- in only but areas, urban system in register to workers migrant registration household the of reform China’s public dual-structured “urban-rural the on below, service system”. section the in outlined be will This China’s Poverty Reduction Policies THREE During the Process of Urban-Rural Integration 97 Dual-structured urban- Dual-structured rural public service system Dual-structured urban- rural compulsory education system impair educational equity for children migrant workers’ . 51 not only in social security, but 52 . 53 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage fees in an eastern coastal district (county) during 2001 and 2005, the compensation for farmers only took up 14.05%; and calculated against against calculated and 14.05%; up took only farmers for compensation the 2005, and 2001 during (county) district coastal eastern an in fees the land auction revenue, the amount used for the compensation for farmers only accounted for 3.2% against the land auction revenue of each hectare. The usage of “fragmentation” describes the co-existence of variousinstitutions, enterprises in urban endowmentareas, flexible employment in urbaninsurance areas, migrant workers, farmers engaging insystems agriculture, and landless for different groups such as divisions. farmers, and fragmented in urban and rural areas as well as separated in private and public public This concept is borrowed from the scholars making analysis of the status of China’s social security system. (Zheng Bingwen, 2009) http://www.scio.gov.cn/zggk/gqbg/2010/201002/t546929.htm. The case studies by Research Team of Development Research Center of the State Council (2009) showed that among the land-transferring The case studies Team by Research This policy, This however, policy, is challenged by the actual situation facing the floating population. The Central Government rules that “children who move with their migrant worker parents and are eligible for admission to local schools, shall be exempted from tuition fees and free of fees for temporary attendance if they attend public schools” (the State 2008).Council, In February 2010, the Ministry of Education fully madeprotect thea equalfurther access announcementof migrant workers’ to children to compulsory education focusingby on building full-time public schools in destination areas and fees for temporary attendance schooling to entirely waive Following the policy that waived tuition fees for compulsory education in rural areasthe previous all year, in tuition fees for urban compulsory education were also waived after September 2008. The goal of full exemption of tuition fees for compulsory education in both urban and rural areas has been achieved. • Compulsory education policy (1) Examples of the urban-rural dual-structured public service system: (1) Examples of the urban-rural dual-structured also in other fields such as compulsory education and basic medical care. Amongst all rural systems are the primary ones. the “fragments”, the separated urban and Unfortunately, with tuition fees waived for compulsory education in urban and rural areas, Unfortunately, educational equity for migrant workers’ children remains a significant issue to be solved. The above defects in the urban-rural integration mean that the floating rural population and landless farmers integration cannot and economic growth on an equal footing sharewith others, and are consequently the achievementsquite disadvantageous offor achievingurban-rural the macroeconomic policies. expected economicantipoverty outcomes of China’s 53 52 51 Actually, Actually, China’s public service system is “fragmented” It is undoubtedly a considerable achievement to establish a rural public service system from scratch. Nonetheless, theincontrovertibly urban-rural a “dual” structure, publicwhich is mainlyservice reflected in for systemisolatedbasic public services with policydifferent operational mechanisms in systemsinurban and rural areas. China is still Such a division indicates that urban-rural integration has not public service system thus far in China. been realized within the It was officially written into policy in 2003 to cover rural areas by public finance, with the result that a “public financial” and public service system financially covering both urban gradually coming into being. and rural areas was 2.2.2 The dual-structuredadequacy urban-ruralof the subsistence publicsafety net of transitional poverty respond to the risks servicein assisting systemvulnerable groupslimits to the Development Research Center of the State Council, 2009) of the State Council, Research Center Development China’s Poverty Reduction Policies During the Process of Urban-Rural Integration THREE and ruralareas policies betweenurban severely fragmented insurance policiesand Four unlinkedmedical 98 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy huge floating population in urban and rural areas in China, nor can they adapt to rapid rapid economic developmentandurbanization. to adapt they can nor China, in areas rural and urban in population floating huge the of requirements the meet cannot urban systems Such doctor. on a seeing residents restrictions rural and of number a put systems registration household rural and urban • rural residentsaredeliberatelydivided,causinganewurban-rural dualstructure. and urban Thus, residents. urban and rural for different are approval for programs and reimbursement, of rate rural and and proportion urban standards, premium and the which employees under urban residents, for separately designed are systems security • Party SchooloftheCentralCommitteeCPC,2010): policies four above the exhibit anobviousurban-ruraldivide,mainlyinthefollowingways(Research Teamsystem, under policy the of perspective the From 2009a). Wanlong, (Lin divide urban-rural the of concept the upon based actually is NTRCMCS However, urban all for and ruralresidents. accessible be to system security medical the enable to institutionally and difficulties, financial in residents urban and rural and population rural the non-employees, urban employees, urban cover to supposed are systems four the speaking, Theoretically begun in2003and2005respectively, andthetwosystemswillbepopularizedin2010. were systems assistance medical urban and rural for projects Pilot 2010. in nationwide launched fully be to scheduled are and 2007, in launched first were residents urban for areas in 2003 and coveredpilot all counties by 2008. Pilot projectsin for basic medical insurance begun was (NTRCMCS) System Care Medical urban Cooperative Rural for of Type New The system 2005. since country the insurance across system this medical extended has and basic 1998, in a employees introduced Government Chinese The • Basicmedicalcarepolicy education fiscaltransfersystemthatispeople-targetedwithoutbeinglocality-limited. education Compulsory policy needs to be planned for urban and ruralpopulation. areas as a whole by building a compulsory floating large the of situation actual the to adapted adequately more be to needs system management education The problem. the solve to required is system management education compulsory the of reform further Therefore, the on based still is permanently registeredpopulation. payment transfer financial the since children, workers’ financial migrant heavy of education compulsory with the for support confronted policy transfer are fiscal of lack cities of because pressure receiving of governments the and education, Central the although situation, compulsory rural a for payment transfer financial such the strengthened governments In provincial a divide. adopted urban-rural has the to China leads 1985, which since that administration”, deregulated is and responsibilities “local of situation system education compulsory this for reason significant One children worker’s migrant and urbanresident’s childrenremains. migrant for between quality gradually educational in implemented disparities is children, policy workers’ education compulsory free the Though • NTRCMCS for and residents and basic employees respectively,for leadingtofragmentation,incompatibility, andhighadministrativecosts. urban for established systems been have insurance systems medical management top-to-bottom independent Issues of openness. of Issues Urban-rural segmentation in terms of the objects to be covered. be to objects the of terms in segmentation Urban-rural Urban-rural segmentation in relation to management systems. management to relation in segmentation Urban-rural The current medical insurance systems designed within existing existing within designed systems insurance medical current The The current medical medical current The Complete and and Complete China’s Poverty Reduction Policies THREE During the Process of Urban-Rural Integration 99 Basic social security Basic social show the systems tendency of fragmented development Urban-rural dual- structured public service system lacks public service and security for the huge floating population and increases social risks , the 55 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage , the number of migrant workers who were covered in the urban medical 54 Resources and Social Security 2009, http://w1.mohrss.gov.cn/gb/zwxx/2010-05/21/content_382330.htm. Ministry of Human Resources and Social Security of the People’s Republic of China, Statistic Bulletin for the Development of Human Source: idem. The urban-rural divide in basic social security policy also for increasesvulnerable groups, subsistenceincluding the floatingrisks population and landless farmers. According to statistics from the Ministry of Human Resources and Social Security of China insurance system in 2009 was 43.35 million, accounting for only 29% of all 150 million migrant rural workers in though China. Actually, NTRCMCS has covered almost all rural areas, migrant workers are excluded from the system due to difficulties in payment and 2009a). reimbursement (Lin Wanlong, 55 54 Take medical Take care for example. Separated urban-rural medical care services exclude a NTRCMCS, as well as system insurance medical urban the from population floating large reducing accessibility to services for the floating population. As forfor urban medical employees, insurancequite a number of migrant workers cannot meet the precondition of “establishing stable labor relations with the enterprises”,system. According toand statisticsthus fromare the excludedMinistry offrom Security Human Resources and Social From the perspective of opportunities andservices capacitiessuch as education,for medicaldevelopment, care and socialbasic security publicindividual providewith a subsistence safety net for their personal eachdevelopment. The lack of basic and every public services weakens the ability of part of the floating population and landless farmers to respond to various personal or economic risks, andpotential risksleaves of themlosing development vulnerableopportunities and to capacities, the and consequently of impoverishment. A A dual system of urban-rural public service can only be effective when urban and rural residents are in two separated groups. However, since a large number of migrant rural workers move to cities and towns for employment, a large floating population is excluded from the publicthisConsequently, service system, and prerequisite no longer exists. of public service as urban residents. has difficulty enjoying the same quality (2) Consequences of the urban-rural dual-structured public service system. (2) Consequences of the urban-rural dual-structured As the urban-rural dual economic system is broken up and economic covering systems security social basic up set have China in areas many diversified, more sectors become groups such as urban residents engagingflexibly in employed,agriculture, migrantand landlessrural dualistically farmers, divided workers,between urban and butrural farmersareas theseand separated in systemsprivate and public are neverthelesssectors with features of fragmentation integrated plan (Zhengto link up the various social the security pension systems. Bingwen,Taking system 2009). There has beenfor rural no migrant workers for example, the basic pension scheme for urban andemployees the new rural social Insuranceendowment degreesinsurance for differenthave so socialdifferent.far The securitynotfragmented beenurban-ruralsystem connected. dual-structured(quality endowment laborers. impact on the movement of rural definitely have a negative disparity) insurance aresystems quite • Basic social security policy • Basic social number of migrant rural workers who were insured against old-age, unemployment and industrial injury under urban insurance systems in 2009 was 26.47 million, 16.43 million migrant of number total the considering low rather is which respectively, million 55.87 and workers. China’s Poverty Reduction Policies During the Process of Urban-Rural Integration THREE favoring richerareas A financialsystem consideration ofpoverty understanding and policy withlacking A fiscalexpenditure 100 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy rural vulnerableandothergroups. between gaps non-income and income the narrowing for unsuitable is poverty of consideration inadequate withits policy expenditure fiscal current The 2.2.3 rural areas in the fields of education, public medical care and social security (China (China security social and and care urban medical Development ResearchFoundation, 2005). public between education, gaps of fields significant the in finally showed areas which rural manifested was expenditure, areas public rural of and levels urban in for resources fiscal in difference The Fig. 8: Support from the central finance for issues related to agriculture, farmers and rural late 1990s(Fig.8). increased not and middle the in expenditures actually than lower even been has has years most in and 2003, since expenditure fiscal total in expenditures such of proportion the areas, rural and farmers agriculture, to related issues on expenditures financial its increased highly-decentralized has finance Central China’s Though 2009). Bank, (World areas urban favor to continues comparison, system urban-rural the by indicated As fiscal expenditurepolicieswerestillinfavorofricherprovinces(W provincial 1995, with Compared payment. transfer financial central poorly-equalized the plus disparities economic to due increased been has income of inequality Inter-provincial Yongjun, 2006). (Wang all at principle of equalization the 67% with do for to nothing had accounting payment transfer total payment the transfer specialized results. and uncertain rebate had tax or the equalization, Furthermore, financial of logic inner the more against or went 80% other either the whilst principle; equalization the with conformity in strictly was most the at 20% only that show 2005 in governments local to Government Central the from payments transfer financial the of Surveys equalization. to relation in little achieves the therefore, payment, transfer financial returned. central is The tax less the area, an poorer and an Government, Central richer the from the receives it system, return tax more tax-sharing the China, the in is in area reform” “incremental of principle the to Due developed areas and towns cities, favors still policy expenditure public perspective: Macro-economic (1) Source: Calculated and drawn according to the statistics from the Ministry of Finance of China. The The China. of Finance of Ministry the from statistics the to according drawn and Calculated Source: data of expenditure on issues concerning agriculture, farmers and rural areas from 1999-2002 are are 1999-2002 from areas rural and farmers agriculture, concerning issues on expenditure of data areas: 1996-2009 not available. not orld Bank,2009). China’s Poverty Reduction Policies THREE During the Process of Urban-Rural Integration 101 Make up for the “short Make up slabs” in the present for poverty relief policies preferential agricultural subsidies 3.2% 6.9% 8.5% 7.8% 8.6% 34.7% 28.1% Poverty-relieving subsidies lack “poverty “poverty lack 56 13.8% 24.9% 19.8% 22.0% 25.5% 30.6% 39.3% Expenditure-linked subsidies Source: Lin Wanlong (2010). 83.0% 68.2% 45.5% 49.9% 66.1% 61.6% 52.1% Universal subsidies increased substantially from 0.50% in 2003 to 4.82% in 2009. 57 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 2003 2004 2005 2006 2007 2008 2009 overall income (including part of governmental subsidies) minus consumer spending (mainly productionthe reimbursement expenditure for farmers’ on public services and living facilities) as a form of subsidies do not expenditure. Therefore, the reduction and exemption of real income. but such subsidies increase farmers’ or constitute the rural per-capita net income statistically, expenditure of farmers. The “policies for preferential agricultural subsidies” refer to subsidies in cash for farmers or policies that directly reduce or waive cash In accordance with China’s statistical indicators, rural per-capita net income refers to productive net income that equals to residual of the Table 4. Change of ratios of three types preferential farmer subsidies from the central fiscal budget: 2003-2009 Table The substantial increase in the ratio of expenditure-linked subsidies will push more and more subsidies into the relatively richer households and may lead to a widened income gap within rural areas. An obvious tendency at present in China is that becausewidely implemented subsidysince 2003, the policiesratio of haveexpenditure-linked subsidies beenhas increased whilst rapidly, that of the universal type has declined Bysignificantly. 2009, expenditure- 4). 40% of total subsidies (Table linked subsidies had nearly taken up nearly However, However, we should also note that in terms of mechanisms, different preferential farmer subsidies also have different influences on poverty reduction.We can classify subsidies into three categories: the universal type, expenditure-linked type and poverty-relieving type. Judged by mechanism and orientation, the universal type is neutral relative in poverty, while mitigatingexpenditure-linked subsidies can increase the income gap within rural areas and play a negative role in mitigating relative since poverty, farmers have to pay some expenses (or have counterpart fund) before they can receive subsidies of this poor absolutely and (low-income households poor of situation the make will this and type, households) worse. Only poverty-relieving subsidies can help mitigate both absolute and relative poverty. Without direct subsidies, the urban-rural income ratio would have increased from in 2003 3.24to 3.42 in 2009; taking direct subsidies into account, the ratio was 3.23 and 3.26 in 2003 and 2009 respectively, basically remaining unchanged. In subsidies othercan make words, a substantialdirect contribution to farmers’ real income, and significantly income gap from widening. prevent the urban-rural 57 56 (2) From the sectoral perspective: policies for preferential farmer subsidies farmer preferential for policies perspective: sectoral the From (2) Since 2003, the Chinesepreferential Government farmer hassubsidies, implemented whichmitigating haveabsolute poverty, playeda increasing series farmers’an income activeand of narrowing rolepoliciesthe urban-ruralgap.in It eliminating is forestimated (Linand Wanlong, 2009) that in alone 2009,reached up subsidiesto RMB254/person,from and centralthat the financecontribution rate of direct subsidies to farmers’ real income sensitivity” China’s Poverty Reduction Policies During the Process of Urban-Rural Integration THREE population cover thepoorfloating rural areascannot systems inurbanand Dual povertyrelief urban andruralareas is alsofragmentedin antipoverty policy system The specialized not wellconsidered vulnerable groupsare and theleft-behindrural urbanization pressure, urban areasunderthe are concentratedin Public resources 102 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy for povertyreduction(LinWanlong, 2009b). gap between these groups and relatively rich groups, and consequently disadvantageous benefit and income the narrowing for unfavorable is it Thus, groups. these for services public of costs higher to and groups, poor and in vulnerable rural decline for quality the service to public leads areas urban towards resources group. service poor public and of tendency vulnerable The relatively a of are that families than these lower at therefore, often note is families; families should migrant rural we left-behind of urbanization, income of the that pressure time same the the to response normal a is it Though utilization ratioofthesefacilities. the increase and pressure demand the lessen to areas, urban in resources service public limited concentrate to inclined are governments county-level circumstances, such Under rural hand, other cities. for leaves population rural large the a as utilized fully be cannot facilities service public on whilst overloaded; severely are facilities service public urban hand, one the on result, a easily. As more survive can are workers rural costs migrant living and where lower cities county-level in obvious more is situation a Such live. and work to areas urban to move residents rural more and more advances, urbanization As sufficiently not are groups vulnerable considered inthepublicservicepatternduetopressureofurbanization rural perspective: micro-economic a From (3) relief. poverty effectivein more be and policies farmer preferential present the in “shortfalls” the for up make to sensitivity,order poverty in low relatively a of policies current the improve can that policies relief poverty specialized some out preferential work should for they subsidies, system farmer policy new a designing when that policy-makers to hints some give least at situations previously-described the gap, income rural the widen even may or However,reduction. poverty for narrow help cannot subsidies direct ever-increasing the if target specifically not beneficial still do are policies these that deny not subsidies will report this although reduction, rural poverty for policies current China’s of most Indeed, system for poor urban groups, including employment assistance, social insurance, social insurance, social assistance, employment including groups, urban poor for system Toanti-poverty poverty,multilayered urban a eliminate established and has relieve China the maingovernmentdepartments atvariouslevels. security between co-operation via social out carried are and policies These policies. rural assistance policies educational assistance for medical policies, Policies assistance social growth. of consist mainly economic networks from benefit farmers ensure to measures, other some taken and network security social rural a up set has Government Chinese capacity,the labor adequate without population rural poor the For government. the by launched projects relief poverty specialized coordinate to levels, government four at short) for offices reduction (poverty reduction poverty development-oriented for offices auxiliary and teams living leading minimum established and rural government, a by and guided system system allowance relief poverty development-oriented a up set has Government Chinese the areas, rural in efficiently strategies antipoverty Toimplement (1) Dual-structuredpovertyreliefsystems be can system policy and poverty, of definition antipoverty system, poverty monitoringsystem. relief poverty areas: specialized three to relation China’s in in considered divide urban-rural The specialized in poverty monitoringandsupportingsystems poverty transitional in trapped segmentation population the urban-rural include on cannot based policies anti-poverty Specialized 2.2.4 China’s Poverty Reduction Policies THREE During the Process of Urban-Rural Integration 103 Poverty standards are differed for urban and rural areas and cannot be used to measure the poverty of floating population Urban and rural poverty monitoring systems poverty the detect cannot of the floating population Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Some studies indicate that the poor areare not incapablepoor people at of all, migration,and that migration thatcan reduce mostpoverty (Worldmigrants Bank, 2009). The National Bureau of Statistics of China has published an annual Poverty Monitoring Report of Rural China since 2000, describing achievementsthe size and changesin ruralin rural povertypoverty, reductionand preferential ofpolicies thefor agriculture,various as povertywell as departments,poverty alleviation institutions reliefand the practices whole policies society. by Nevertheless, various the separate monitoring systems for urban and rural areas cannot detect As population. stated thein the previous povertysection, the poor floating populationsuffered has nowadays by the floating become the main body of the urban poor, andpopulation the is povertymuch higherincidence than thatfor forthe the floatingurban Team populationof (Li ChinaShi, 2003;Urban Research Poverty, 2003). As population are thenot included in and monitoring, thus poverty the monitoring design quality, poor people among the huge floatingof antipoverty policies, will be substantially affected. (3) Dual poverty monitoring systems It is obvious that the poverty line for rural areas is set at a very low level and that the line poverty of standards double and criteria, and definition authoritative lacks areas urban for adopted for urban and rural areas cannot clearly describe or measure the poverty of the floatingA population. significant change in the composition of the urban poor population in China in recent years is that migrant labors have gradually become the main group in urban poverty, and many of them finally fall into a special group of urban poorwho people, have no land (after their leaving rural areas), fixedcasual workplaceslaborers) (asnor theysocial aresecurity only (which is exclusively enjoyed byand urbanwho residents),cannot enjoy the urban minimum living allowance.2006). (Lin Ka, Fan Xiaoguang, However, until the present there has been no scientifically poverty in departments China. and Various unifiedinstitutions have rather different definitions or standard for urban understanding of the urban poor population. The minimum living allowance in different greatly from one to another due to lack of unified criteria for calculation. cities differs The poverty line for China’s rural areas was first calculated by theStatistics National of BureauChina, of based on data from rural household demands surveysin 1984, and and was from based basicon a rural definition of absolute poverty. Since 2008, new criteria for rural poverty relief have been put into place and poverty alleviation policy has been implemented fully for the rural poor and low-income population who live below the The new poverty line was raised to RMB1,196/person. subsistence level. (2) Dual standards of poverty (2) Dual standards of It is notable that poverty reduction offices and of social ruralsecurity povertydepartments alleviationin charge are set uponly basedlaunch uponpoverty administrative relief projectsdivisions, targeting andjurisdiction, but are unable to help the poor Thefloating urban population. minimum living localcan rural poor groups within their allowance own system, on the other hand, only provides a minimum living allowance for the urban poor population, but not for the floating population in urban areas. It thus can be seen that both urban and rural poverty relief systems have strong “local limits”, so that alleviation systems. is excluded from present poverty the large floating population assistance assistance and relief, as well as other measures, the core of which is the minimum living allowance system for urban residents, implemented by social security departments at all levels. China’s Poverty Reduction Policies During the Process of Urban-Rural Integration THREE groups frompovertyrisk protect thevulnerable protection canhelp opportunities andsocial Social andeconomic 104 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy the ability for self-protection of people trapped in transitional poverty via enhancement enhancement via poverty transitional measures. in enhancing trapped on people of emphasis more self-protection puts for It ability market. the the by insurance commercial as well as communities, and families from coming measures security social informal the of also but government, by taken measures security social the of consists only not protection Social manage socialrisksandreducevulnerabilitydeprivation. better to order in communities, and families individuals, specific targeting government, by scholars. other and taken actions Jorgenson public other and UK investment and support public the to refers protection Social and the (DFID), (UN), Nations Development United International the for Bank, Department World the as such organizations some by time same international the around proposed protection” “social of concept the is other The et al.,1995). social of (Sen, opportunities social capturing in affectability person’smay basic a cooperation social benefits of the possibility the to and class social access care, medical education, people’s as such on Factors development. influences have also but and quality, social living in economic various in with role groups social important an different economic opportunities. The change in social opportunities will not only result in differences play provides turn, in opportunities which, economic development, and social that is One this on Based dramatically 1960). theory, twotendencieshaveemergedinresearch: be (Hayek, will protection special scenery any without rural vanish The totally and industries. changed nonagricultural in that as wide as is conditions working similar under farmers between gap income the industrialization, During introduced intopovertypreventionpolicyforvulnerablegroups be must protection social and opportunity social of concepts The 3.1 to refer can we experiences include: international term summary, a In is labor”. which “mobile groups”, of that employment to “informal similar for poverty of issue the with dealing in experience countries other on draw only can we Instead, countries. other many in laborers” “mobile of notion equivalent an be not may there that mind in bear must we Nevertheless, process. integration urban-rural China’s during groups vulnerable for policies appropriate antipoverty designing can when We countries other defects. of own experiences our and practices remedy the from help learn can others from experiences and Suggestions 3. InternationalexperiencesandLessonsLearnt must bepaidtotheincomepovertyofmobilepopulation. attention close case, accurate, more is figure ever Which population. mobile rural million 150 the of poor million 20 than more is this that indicating 2005), Riskin, and (Khan 2002 in 14% was cities to areas rural from population mobile the for incidence poverty the shown that have studies Other 2009). Bank, (World 11% was households left-behind for that the by launched survey whilst 8%, was families migrant for household incidence poverty the that Statistics rural of Bureau National the from statistics the quoted Bank World the the general income poverty line. In the same report containing the studies described above,to according even migrants, of proportion substantial a comprise still people poor fact, In attention tothemobilepopulation”. “paying continuous attention to rural left-behind population”, rather than for “no need to give for basis the as taken be only can this era, new the in work relief poverty the in However, China’s Poverty Reduction Policies THREE During the Process of Urban-Rural Integration 105 All the developed countries have set up nationwide social safety nets, to effectively reduce the risk of impoverishment The US Government introduced a unified social security system in Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage After 20 years of rapid economic growth, by the 1980s, there had been In the initial phase of German social insurance in the 1880s, the German The Japanese Government began to treat social security as a policy system Rather different from the German case, when launching its unified security program, after WWII (Lv Xuejing, 2000). The initial form of the Japanese social security was the “guideline for assistance to the poor in emergency” carried out in 1945. Life law (also called the old law) to guarantee the minimum living standard of the unemployed protection and poor population was introduced in 1946.security, unemployment,During industrial 1948injury andand occupational1953, safetylaws were forintroduced livingafter one As another. the national economy recovered, the government pushed forward and finally achieved compulsory systems for “national pensions” 1996). during 1957 and 1961 (Center for Japanese Studies of Fudan University, and “national insurance” A A nation’s strength of security is based upon government taxes (Meriam,and borrowing etc.,power 1950). Fiscal strength issecurity systems a built strongin the developed pillarcountries have effectively to reduced socialpoverty, and security.provided security for mobility of human resources. The social introduced the right to the pursuit of happiness, the right to claim for appropriate salaries, social welfare rights and environmental rights, all as citizen well rights as andeconomic obligations,clauses to as protect vulnerable social groups; national medical, citizen annuity and minimum salary systems have also been 1997). established (Zhang Yunling, There are three levels of minimum living standard in South Korea: the minimum survival level, the minimum living level, and the standard living level, with the first as the standard for social security (Zheng Bingwen, 2001). 1935 (Hayek, 1960). In the 1930s, France introduced revenue (Bloch, 1931; Laroque, 1948). measure for fair distribution of national a social security program as a the British Government enabled the population at riskinstitutions. to establish Intheir 1936,own securityaround 1.8 communitiesmillion enjoyedpeople pensions;from theand theindustrial figure (Seldon, 1957). million of whom worked in the private sector andwas closecommercial to 8.5 million in 1957, 5.5 Facing with the mobility of its population, a country must build a nationwide social safety net for the population at risk, in order to effectively provide guarantees and security for the poor. 3.2 A nationwide of populations at risk impoverishment social safety net will help reduce the The significance of social opportunity and social protection in relieving and eliminatingtransitional poverty lies in: Firstly, establishing a complementary social security system between families, communities and the nation, preventing the social protection provided by the nation from crowding out informal social situation securityof family measures,protection being and weakened avoidingby the the nation as has happened Western countries. inhow Secondly, to some deal with rural vulnerable groups such as landless workers, emerging in transitional economy. farmers and migrant Government mandated that the population at risk be included in unified insurance service service insurance unified in included be risk at population the that mandated Government institutions and insurance against old-age, incapacity industrial to injury, work, inability of independent living and unemployment. South Korea: Japan: USA and France: UK: Germany: China’s Poverty Reduction Policies During the Process of Urban-Rural Integration THREE 58 one isneeded risks, andanintegrated have biggerpotential social safetynetmay experience, afragmented Based oninternational The first paragraph and the following analysis concerning the social security systems in UK, France and USA in this section are mainly mainly are section this in USA and France UK, in systems security social the concerning analysis following the and paragraph first The 106 quoted fromZheng Bingwen(2009).Quotedtexts areabbreviated,simplifiedand omitted atsomeplaces. Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy Chile: Chile: PRC: province, Taiwan USA: France: UK: into three sub-systems for blue collar workers, wage earners and public servants. Within servants. public and earners wage workers, collar blue for sub-systems three into In the USA, under the “unified” social security system, there is no difference between between difference no is professions andsectors. All peopleareinsuredwithinthesamesystem. there system, security social “unified” the under USA, the In privileges. a particular is enjoying groups there some with which entitlement, in among disparity large systems, relatively own their up set groups i.e. in manner, mainly realized fragmented a been has coverage full countries, European continental In stability. social on influences different with and ways different in but coverage, have social full realized basically countries European developed and USA the in systems security Social 3.3 TheFragmentedsocialsafetynetneedstobeintegrated two years, meeting the government’s reforms head-on. Small-scale strikes, marches, marches, strikes, demonstrations andstreetpoliticstakeplacefrequently. Small-scale head-on. every reforms about government’s movement the meeting social years, two nationwide a launched have insurance endowment in privileges have demonstrations that sector railway aroused the as has such “sub-systems” country.Some reform the across of intention or agendas reform each government’s However, many on France. in objective primary the of been has reform the system decades, pension disparity recent the In i.e. burden. fiscal obvious, heavy more extremely and an and more treatment, getting in been have system fragmented the in defects war, the after years 60 the During reasons. various for failed but UK, the did as systems. fragmented traditional reserved have countries European Western some whilst systems, European Northern unified established and systems fragmented their integrating in succeeded also countries countries. other many by followed been has and and world, Europe whole for the example new a set and model fragmented previous the from resulting discrimination social eliminated has system This institutions. management unified and eligibility, entitlement unified unified i.e. system, security social “three-unity” a up set and (Zheng Bingwenetal.,2001). another after one up such set being annuity” systems “national and insurance” security health “national the as comprehensive unified with 1990s, the in made was progress significant and growing, was economy regional the as security 1980s the unified in The up set was entitlement. system and pooling own its had which of each farmers, and workers militaries, officials, government for sub-systems independent four into divided fully coveringallgovernmentofficialsandemployeesinprivate enterprises. 1980s, the in process the completing finally and a step, by step in coverage enlarging unity”, trapped it was nor fragmentation”, after situation of “patching fragments” as France was; instead, it took a unique path of “gradual “integration of neither way system British security the social followed American the covered, most being and not limited officials relatively being government initially coverage Despite path. new a found US the structure, dual obvious the an with of even and level time, that at Europe development of that to economic similar Social was the US the Though when 1935. in beginning very approved the was Act from Security enterprises, and sectors upon based one After WWII, the British Government integrated the fragmented social security model security social fragmented the integrated Government British the WWII, After The USA has established a unified social security system, rather than a fragmented Chile established its social security accounting on a cash basis in 1924, divided divided 1924, in basis cash a on accounting security social its established Chile France tried to integrate its fragmented social security system late in the WWII the in late system security social fragmented its integrate to tried France Social security was initiated in Taiwan province in the 1950s, and Taiwanin 1950s, initiated the was in security province Social 58 China’s Poverty Reduction Policies THREE During the Process of Urban-Rural Integration 107 Many countries provide job opportunities and loans in various ways, in order to ensure employment and prevent poverty of the mobile population Banks granting small loans to low-income groups and women have Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Amongst all the projects to increase the income of vulnerable groups in As a country with a large population in informal employment, Brazil tries through As urban areas expand at a high speed, a huge number of rural people have played an important role in poverty relief in Kenya. In Kazakhstan, some private banks form consortia providing joint capital support for small urban enterprises,contribution to antipoverty (Feng Juan, The 2004). social pension system in Namibia and and make a credits to alleviate the poverty of the urban informally employed population by creating job opportunities and enhancing urban competitiveness. To supportBrazilian the efforts Government,of the the World Bankto promoteoffers specializedeconomic growthloans andto opportunities, facilitateenhancing Brazilianthe capacity of municipal cities,engineering, projects improving infrastructure for increasingand public services, alleviating incomethe relatively intense and poverty, solving the andproblem of job economic stagnation Bank, (World 2008a). Comparative studies on the of effects poverty efforts reduction poverty that shown have sectors and industries various among reduction in tertiary industry achieved much better results (Ferreira, etc., 2007). than that in agriculture and industry Bangladesh, the combination of subsistence guarantee measures (food assistance) and improvement measures (skills training and microfinance) is the main focus of antipoverty policy. Microfinance projects provide poor groups with small loansout and of help povertythem get through training, donations andapplication for small loans include urban financialresidents and Though the the rural mobile poor. services. Groups eligible for population in Bangladesh is not as large as in China, the practice of providemicrofinance can us with references for poverty farmers in China. relief for the mobile population and landless 3.4 Job opportunitiesmeasures forand employment employment falling into poverty population from security loansand for arepreventing important mobile these three sub-systems, there were around 50 smaller “fragments” based upon specific categories. The benefit levels of the secured groups under various “fragments” differed Since reform greatly. in 1980, a unified nationalsecurity system has been set up, putting emphasis on self accumulation, self security and the of for-profitthis system purpose.has gone The beyond successexpectation and attracted considerable attention 2008). from Weibin, from international organizations (Gong around the world and rushed to cities for more economic opportunities. Slums have taken up to one fourth of the total urban housing. More than a half of the residents in Mumbai are living in slums. To enhance the protection for informal employment schemegroups, for an farmersemployment launched securityin Maharashtra enhanced farmers’government risk interventionstolerance; also,in Kerala provided employees in socialrural industriessecurity with (Chenbasic Qianheng, 2006). populationForeign areexchange a significantearnings achievementby the ofhigh-levelmigrant Indianpolicy-makers pay povertyattention to alleviationexpanding overseas remittancespolicy. in India’sthe worldand in so doing find new ways for the poor to get out of poverty (Ratha and Xu, 2008). Governments established mobile population welfare foundationslook forto destinationsprevent forrisk, the and migrant population, build cooperative destinations relationsand clarify responsibilities, with in order these to strengthen the safety and security of exported workers, and reduce their vulnerability. Furthermore, governments measures such as alsoregistration for migrants, information disclosure, and labor recruitment take of those going to work abroad. regulations, to protect the rights and interests Other countries: Brazil: Bangladesh: India: China’s Poverty Reduction Policies During the Process of Urban-Rural Integration THREE system household registration Promoting the “non-elite” intensive industries to developinglabor- Devoting majorefforts a must inclusive developmentis Long-term strategy:an policies traditional antipoverty and needstoadjustits urban-rural integration, poverty inthecontextof challenges oftransitional China isfacing 108 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy one, i.e. there must not be many restrictions on household registration for the immigrant the for registration household on restrictions many be not must there “non-elite” i.e. one, a be should reform Such reformed. be to in needs groups and for period, transitional vulnerability the of causes major the of one been time some for has system nonagricultural opportunities, increasing allowances for the elderly left-behind, and and left-behind, elderly the for diversifying theincomeofleft-behindpopulation(World Bank,2008b). allowances increasing opportunities, nonagricultural access to population left-behind economy,rural non-farm the rural of skills the enhancing the promoting practices, farming flexible more developing by population left-behind for the poverty 2009). reduce to approach Chunying, alternative (An an found them have for countries some channels Additionally, employment more opened and poor the of income the increased have education, and agriculture enterprises, small in investment for used is that Mozambique in population poor urban the for payment transfer cash the • household registrationsystem, puttingmoreemphasisonthefollowingmeasures: the on restrictions lift gradually should we creation, job of Tocapacity urban the enhance (2) Buildaunifiedandfairproductionfactormarketinurban andruralareas policy objective. fundamental a as viewed be must This jobs. enough provide can that industries service devote major efforts to developing middle-and-small-sized labor-intensive enterprises and to have policies macro our result, a cities. As in opportunities long-term, job adequate requires is and areas urban in work to laborers rural of number large a for tendency The job enhancing and industries labor-intensive creation inurbanareas developing to efforts major Devote (1) systems: following the of construction the accelerate should we Thus, process. into comprehensive a integration economic urban-rural single the reform should we instead, speed; and in urbanization in developing countries. China must not put undue emphasis on efficiency the and gap, income estrangement and even opposition between rich and poorwidening groups, which occur frequently, a as such problems avoid should We integration. rural urban- of achievements the share to them allows that and pattern groups vulnerable development all a benefits and system policy a establish must China run, long the In 4.1 Long-termnationalstrategy:aninclusiveurban-ruralintegration in poverty transitional urban-rural integration. concerning issues with deal can we that so to policies, strategies short-term long-term from ranging and levels, micro and macro all covering system, policy urban-rural interlinked and balanced structured, a develop to need we Therefore, in thepolicysystem. of risks the tackling divide urban-rural the is in problem main The groups. these confronting poverty and defects transitional several policy have systems antipoverty policy macro relief poverty China’s specialized present, At conditions. severe and development limited resources incomes, low with ones, traditional from different are that groups vulnerable and poor new form integration urban-rural farmers China’s in landless people left-behind workers, and rural migrant of population ever-increasing the up, sum To rural integration urban-rural urban- in poverty transitional with deal interlinked to system and policy balanced a Structuring 4. Promoting the “non-elite” household registration system. system. registration household “non-elite” the Promoting China’s household registration household China’s China’s Poverty Reduction Policies THREE During the Process of Urban-Rural Integration 109 Realizing “equal right Realizing for and equal price” land for urban and rural construction Promoting integrated service public urban-rural system The core is a nationwide subsistence safety net covering all the vulnerable groups in urban and rural areas

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Realizing “equal right and equal price” for urban and rural land for construction. At the same time, we should constrain a current trend servicein policy, provisionof beingunbalanced concentratedpublic in urban areas as more people give movemore consideration there,to the andavailability of public services for left-behind rural groups. As for the distribution of governmentfor urban spending,public servicesthe causedexpanding by urbanizationdemandservices of rural vulnerable forandand left-behind capitalthegroups should basicbe considered demandsin a balanced for public Public services such as education, medical care, endowment insurance and poverty relief relief poverty and insurance endowment care, medical education, as such services Public are crucial features in targeting people, so subsidy mechanisms should be more people- oriented, rather than limited to household registration localities, so that the destinations of the mobile population can be more active in enhancing and planning public services as a whole, and help reduce the fragmentation in urban-rural public services and boost labor mobility. (4) A new financial transfer payment system targeting people, rather than beingA based on (4) household registration and locality based Considering various levels of economic developmentlimits of current financial transfer central payment finance policy, can give some support, in different provinces and theand encourage provinces to establish integratedwithin provincial urban-ruralboundaries initially, and then proceed to publica nationwide serviceintegration when systems conditions are appropriate. The essence of building an “integrated” urban-rural publicto put servicemore into system rural public is services notand give only more support to public services for rural vulnerable groups, but more importantly to break the rural boundariesareas step betweenby step, establishing urban an integrated and rather than a “fragmented” urban- rural public service system, and building a nationwide subsistence safety net all coveringthe vulnerable groups in urban and rural areas, taking urban and rural residents as a whole. Generally, China’s urban-rural public service system is “fragmented”urban-rural divide. Such a system is based andupon the concept of isolating featuresurban and rural an areas and residents in these areas, with qualities different of public service policy system and public service quality for different groups. As urban-rural integration advances, the present policy system is neither fair nor effective, and using it makes it hard to effectively deal with the poverty suffered by large numbers of vulnerable people in the transitional period. If this “fragmented” publicadjustment costs will increase. service system cannot be adjusted in time, the (3) Reform the “dual” urban-rural public service system, eliminate public service quality disparity for different groups and promote urban-ruralservice policy system integration in the basic public Rural land should be given as a complete property right, and urbanconstruction and rural shouldland forbe dealt with in the same price. way, withThe subjectequal of rightproperty andrights, atand rightsthe andsame interests of legally confirmed, and farmers givenland back their legal rights as owners of land,transfer so that fair must be “compensation” for landless farmers can be realized, and a poverty-relieving established. urban-rural integration mode of • population, so that most employees in urban areas canurban areas. gain permanent residence in China’s Poverty Reduction Policies During the Process of Urban-Rural Integration THREE coordinating institutions urban-rural povertyrelief Establishing integrated rural povertylines Comparable urbanand locality-limited people morethanbeing relief policytargeting strengthening poverty Establishing and alleviation strategy poverty intonew Including transitional poverty reductionsystem a linked-upurban-rural Mid-term plan:settingup 110 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy comprehensive manner. more a in poverty consider can system payment transfer financial new the that so way, relief coordinating institutions, to integrate the existing resources of poverty relief relief poverty of system, promotingalinked-up andunifiedurban-ruralpovertyreliefsystem. resources existing the integrate relief poverty unified a in work relief poverty rural and urban include to and organizations, to institutions, coordinating relief poverty urban-rural integrated establish will we aspects, three above the of basis the On urban-rural povertyreliefcoordinationinstitutions integrated establishing and organizations relief poverty of resources the Integrating (5) comparable urbanandruralpovertylines. on based poverty in changes reveal dynamically and population, urban and rural the both cover can systems monitoring poverty that so frame, sampling and monitoring same the into residents rural and urban put and monitoring poverty of sampling the adjust will We (4) A povertymonitoringsystemcoveringurbanandruralareas poverty integrated urban-rural in reduction system. gradually included be should capacity. people economic poverty national the on All based raised, gradually be should standards Poverty to as so lines, poverty rural and establish comparableregionalpovertyreliefpoliciesacrossthecountry. urban comparable and dynamic set will we regions, various in areas rural and urban between costs living in differences the mind in Bearing (3) Comparableandgraduallyimprovedurbanruralpovertylines people targeting policy relief more thanbeinglocality-limited. poverty a up set and population, mobile the by suffered will both help reduce regional poverty in rural areas and pay more attention to the poverty of instead areas”, practices poverty,relief transitional poverty includes new that program alleviation poverty “rural to limited is new efforts the with population. Aligning mobile poor poor the or poor urban the these covering additionally rural of are scope levels actual various at the and efforts relief groups, poverty of targets main the present, At being than more people targeting policy locality-limited relief poverty strengthen and Establish (2) guidelines willtakeintoconsiderationtransitionalpovertyandgroupssuffering fromit. alleviation poverty new China’s Thus, groups. vulnerable of opportunities and capacities development enhance to strategies relief poverty macro future in link crucial a it making poverty transitional to and groups, these for impoverishment of risks highlighting groups, sufferedvulnerable by attention more pay will strategy reduction poverty new China’s (1) Includetransitionalpovertyinthenewalleviationstrategy situation This group. this must bechanged. covered yet not has system policy relief more poverty them specialized make may China’s However,which future. the in conditions uncertain development, and impoverishment to from susceptible risks future facing are mobile the especially population, groups, vulnerable of number large a and integration, urban-rural In objective policy a as poverty establishing anintegratedurban-ruralpovertyreductionsystem transitional Addressing 4.2 China’s Poverty Reduction Policies THREE During the Process of Urban-Rural Integration 111 Reform of household Reform of household in registration system large and middle-sized cities Accelerating to set up and enhance links between the existing urban and rural policies Investing more in preferential policies for agriculture to make up for “short slabs of poverty relief” Enlarging the scope of rural medical assistance At present, rural medical assistance Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Enlarging the scope of rural medical assistance.

fees are fully or partly paid by those assisted, so that they can enjoy cooperative medical care. farmers However, still have to pay for most of their medical fees, even if they have been covered by the insurance program. Rural poor and low-income groups excludedare often from the program, since they cannot afford even the participants of the program cannot benefit fromthe it. It is suggested to invest more self-paid medical fees, and money in rural medical assistance, and to subsidizehelp them pay poormedical fees, so and that the low-incomerisk of illness-induced peopleimpoverishment for poor to farmers can be substantially reduced. • Besides improving and enhancing the rural minimum living allowance policy that mainly targets absolutely poor rural residents, we should also strengthen the financial support policy for rural low-income and vulnerable groups, to narrow the income gap within rural are: areas, or prevent the gap from being further widened. Some specific measures We We should assess the poverty reduction effects (including the effects of relative poverty alleviation) of current preferential policies forpolicies and agriculture,working out new ones. With whilstthis assessment, we strengtheningcan design more specific these poverty-alleviating preferential policies for agriculture, to make up of for povertythe “shortrelief” slabs in universal and expenditure-linkedpolicies. preferential agricultural subsidy (3) Strengthening the poverty-sensitivepolicies for agriculture policies supporting the current preferential Those in urgent need of linking-up are urban and rural compulsorythat have direct influenceseducation on intergenerationalpoverty; next, wepolicies can gradually ease the duality of urban and rural medical insurance policies by strengthening medical insurance for urban employees and creating the new rural cooperative medical system; following this, we will consider linking urban and rural endowment policies. Based upon all these, policy systems and realize policy integration. we can complete the transition between Undoubtedly, Undoubtedly, the “integration” of urban-rural basic public service policy will adequately consider the limits of economicGovernment, anddevelopment be carried forwardand stepthe by fiscalunifiedstep,Taking pace. the instead actual situationroom andof conditionsbeing intoof account,at we the willan accelerate Chineseabsolutely existing urban and rural policies: and enhance the setting up of links between (2) Enhancing the links betweensystem urban-rural public service policy foundation for the unified urban and rural public service systems, to lay a Had the reform of household registration system started in middle and small-sized cities, there would have been less of a negative impact. Subsequent include reform,migrant however,workers. As must previously described, most migrant rural workers in system registration household the of Chinareform the from benefit cannot and cities large in are in middle-and-small-sized cities. Therefore, the reform should be launched gradually in large cities to benefit most migrant rural workers, on the basis of the current household cities and towns. registration reform in (1) Reform of the household registration system in large and middle-sized cities large and middle-sized system in of the household registration (1) Reform 4.3 Short-term policies and measures: improving current poverty of transitional the challenges and reducing policies China’s Poverty Reduction Policies During the Process of Urban-Rural Integration THREE urban employment vulnerable groupsof training projectsfor Initiating comprehensive farmers support fundsforsmall Founding production 112 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy areas. • an attempt in this regard, and can be promoted, based on summaries of their experience. are areas some in offices alleviation poverty by launched funds aid mutual village-level of projects pilot The farmers. small for support financial strengthen to loans, small with together used be also can funds Specialized gradually. market the in involved become them help and producers rural small-scale subsidize to established be funds specialized that recommended is It excluded. largely are farmers small whilst production, specialized for agricultural production are mostly expenditure linked, favoring large-scale farmers and • regulations andpublichealth,tohelpthemadapturbanlifeasquicklypossible. and laws on education as well as training, skills with groups target the provide will They • and micro-enterprise income earning programs, as well as mutual aid groups and and groups suffered byleft-behindvulnerable groups. aid mutual as well as poverty non-income and elderly,income programs, left-behind the the mitigate for to centers activity earning income micro-enterprise women, and left-behind for training skills agricultural interventions, psychological including women, and elderly the children, left-behind targeting projects intervention specialized

Founding production support funds for small farmers. small for funds support production Founding Initiating comprehensive training projects for vulnerable groups employed in urban urban in employed groups vulnerable for projects training comprehensive Initiating Starting intervention projects for left-behind groups. left-behind for projects intervention Starting These projects are aimed mainly at migrant rural workers and landless farmers. farmers. landless and workers rural migrant at mainly aimed are projects These The present financial subsidies subsidies financial present The It is recommended to begin begin to recommended is It China’s Poverty Reduction Policies THREE During the Process of Urban-Rural Integration 113 International - Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Experiences 3. Devising Policies to Address Transitional Migrant Needs Address Transitional 3. Devising Policies to In many countries, particularlychildren’s educational attendance in and regular Latinattendance at America,health clinics are made to cash poor migrant families, and transfersthe provision of these is not tied to tight residence criteria, but conditional upon It is important to recall that China has already made progress in the provision of social protection and insurance for its migrant population. For example: Measures passed2006 in guaranteed a minimum wage and introduced a of systemmigrant forworkers, monitoringtogether paymentwith a system for enforcingthe introductionlabor contracts,of followeda detailedby wage payment provinces systemhave experimentedin with2007. measures Recently,to establisha socialnumber insurance of systems for migrant workers in Guangdong, Shanghai, Beijing and Zhejiang. Insurance for the elderly schemes have also been extended to migrant workers, as have insurance against injury schemes. Based on international experience, what additional useful measures could be introduced? 2. Providing Social Insurance and Protection Schemes for Migrants 2. Providing Social Insurance Evidence from international experience of of the policies effectiveness for this transitional period comes largely from China. The field is experiences, and research and assessments from elsewhere in this field are fairly limited. dominated by assessments of China’s The focus of the Report is on the need for integration, and several international examples examples international several and integration, for need the on is Report the of focus The are provided of integrated systems in Germany, relating question additional an raise to important is it these, reiterating than Rather Korea. the UK, the USA, Japan and South to the current situation and its development in the next few years. During the of periodsorts what integration, increasing of one to split rural-urban a from move policies which in policies should be devised to meet the needs of the migrant population in this transitional period? What policies might be most appropriatesystem emerges? Should inpolicies initially thefocus on the interim,group of longer-term, permanent until a more unifiedmigrants and their families? Which areas are of particular importance for improving the years? position of migrant workers in the coming In recent years patterns of migrationincreasingly have changedare resettlingsomewhat inCentral permanentlyChina. and Migrantslocal in governments urban need areas,toto design addressoften and problemsimplementwith emergingtheirnew sets from families. ofthis Report, policiesmigrants increasedfare considerably worse permanency.than local residentsAs in outlinednearly all non-income measures in of thewelfare, and promoting greater equality between them and local residents is a high priority, with an extension of particularlyaccess urgent.by Extendingmigrants social to assistance socialprogrammes insuranceto cover beingmigrants accomplished will gradually be in the coming years, accompanied by an increasing unification of these programmes between the rural and urban sectors. By capping urban benefits at current levels and gradually raising rural benefits the rural and urban systems of social and harmonized, as stated in the Report. assistance eventually can be integrated 1. Designing Policies to Needs Meet Rural-Urban Migrants’ Changing Migration Migration and Transitional Poverty Appendix Four Appendix China’s Poverty Reduction Policies During the Process of Urban-Rural Integration THREE 60 59 61 SeeZhu2007. Project, Reduction Poverty Mountains Qinba the for Report Completion Implementation the in detail some in described is programme This For more detail on the provision of ration cards, see P. Deshingkar and S. Akter, “Migration and Human Development in India”, Human Human India”, in Development Human and “Migration Akter, S. and P.Deshingkar see cards, ration of provision the on detail more For 114 Development ResearchPaperNo.13, HumanDevelopmentReportOffice,UNDP World Bank,Washington D.C.,2005. Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy system in local markets is well-known for its effectiveness in increasing knowledge knowledge increasing in migrants effectiveness poor for its employment off-farm for of well-known is markets local in system placement job computerized a and training on-the-job providing region, Mountains Qinba the in implemented programme the of experience The employment. finding in migrants rural assisting in role important an play Programmes Market Labor longer-term, the For a certain extent in recent years to cover old-age, employment and health insurance. insurance. health and employment via protection social extending in Progress old-age, cover to years to recent extended in been extent have certain a schemes existing above, mentioned As migrants of rural-urban needs specific the meet to created be programmes independent new be but schemes extended, existing must only not therefore, contributions problems, migrant’s employer’s address Totheir as remain. whereas funds, these to contributions own their out take only can they withdraw move. they Additionally, they when when them with benefits insurance the take cannot they because stage later a at withdraw but schemes insurance with skills training for work in urban and semi-urban area, and with food assistance, if if assistance, food needed. with and area, semi-urban and urban in work for them training preparing skills with households, rural poor for implemented been have programmes term short- Bangladesh, In market. local the in prevalent those than higher substantially were this 2005-6 In programme created more than 10,000 jobs in semi-urban areas, resulting in incomes that mentors. as acting industries from staff with programme three training a month following areas, semi-urban and urban in jobs to them linking migrants, young Pradesh, India have been very successful in providing employment options for vulnerable in programmes Similar Andhra 2003. in established was migrants for programme training to providehostelaccommodationformigrants,withafocusonmigrantchildren can obtain temporary ration cards in urban areas and local governments work with NGOs migrants seasonal India In example, For countries. developing many in provided is areas welfare specific in rural-urban for provision short-term more transfers, cash to addition In increased, have enrolments there islittleevidencethusfarofimprovementsinlearningoutcomesschools. school whilst Similarly, children. the for status nutritional improved to led always not has this checks, health preventive for going households poor from children of likelihood the increase to CCTsappear whilst example, For variable. is evidence for conditional cash transfers (CCTs) improving health and education conditions However, as outlined in the accompanying the in outlined as However, income. household of levels of evidence and cards identity as such means of use the via and thus require policies that are portable are that policies require thus and An important characteristic of rural-urban migrants in China is that they are highly mobile, protection social in migrants by participation programmes bepromoted,andparticularlywithinsocialinsuranceprogrammes? increased can to How portable? more made be migrants for protection social can Towhat are: experiences, international from Additional issues of possible relevance for China’s current transitional situation, emerging 4. Mobility, PortabilityandParticipation on employer provision, which have often proven unreliable. These could take the form form the take could These unreliable. proven often have which provision, employer on less and provision government local and central on relying programmes, specific more , New York, 2009. 61 Dibao . For example, many migrants enroll in social in enroll migrants many example, For . 60 Note on Climate Change and Poverty and Change Climate on Note . Beyond this, more generally, a national national a generally, more this, Beyond . has also been slow.been also has for need a is There 59 . , the the , China’s Poverty Reduction Policies THREE During the Process of Urban-Rural Integration 115 , rural- 65 . Poor awareness and 64 . This is not largely because of 63 . 62 Century Economic Report, Beijing, 2007. st Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage in Tianjin”, in Nielsen, Ingrid and Smyth Russell (eds), Migration London, 2008, pp. 184-204. and Social Protection in China, World Scientific Publishing Company, to pensions insurance. SeeXiao, S., and Liu, J., “Labour Subcontractors, It Is Not Easy To Keep You”, Workers Daily, 27-04-2005. Daily, Workers You”, Keep To to pensions insurance. SeeXiao, S., and Liu, J., “Labour Subcontractors, It Is Not Easy Rural Labour Urbanization”, 21 Public Policy and Administration, Jiaotong University, Xi’an, 2010. Administration, Jiaotong University, Public Policy and Construction and Service Sectors in Tianjin”, in Nielsen, Ingrid and Smyth Russell (eds), Migration and Social London, 2008, pp. 184-204. Protection Scientific Publishing Company, in China, World For details of this survey, see Li Bingqin,”Why Do Migrant Workers Not Participate in Urban Social Security Schemes? The Case of the Li Bingqin,”Why Do Migrant Workers Not Participate in Urban Social Security Schemes? The Case of the Construction and Service Sectors For example, surveys by Xiao and Liu, in 2005, in seven provinces and found one that large 90% city, of migrant workers did not contribute See Zhang Sifeng et al, “China’s Migrant Worker’s Social Security”, Chinese Journal of Population, Resources and Environment, School of further A survey by Guan similarly found that the participation rate in pension schemes was les than 10%. See Guan, X., “Social Policy for urban migrants stated that they would welcome greater guidance from employerslocal and authorities. Given existing low levels of understanding, which major improvements can be made. clearly this is an area in 65 64 63 62 problems attendant on withdrawal from these schemes as outlined above, but because in many cases migrant workers are unaware of the schemes, and even if they are aware of their existence, do not understand the basics of the schemes of conditional cash transfers to poor migrants, focusing on and,periods particularlyof unemployment, in relation to areas developing such such policies have been raised in asa number of contributions to healththe debate on and education. Suggestions social insurance programmes for formigrants, particular in recent months, and these should for research provide a further basis Where social insurance schemes are available,migrant workers are it not keen alsoto participate remainsin them the case that many Apart from the widely prevalent problem of enforcing such policies since many of them are disseminated in the form of “guidelines”and thus or can“opinions”, be compromisednot asat theenforceable local otherlevel, laws, countries a with furthermigrant workers problemis the as low is level theof participationcase of suchin migrants schemes.within Addressing the enforcement problem requiresof relevanta further institutional development and legal frameworks through can be clearly defined. of governments at various levels migrants and the obligations which the rights of rural-urban limited understanding appears to be a major barrier to participation. Research indicates that much of the information provided by insufficientmigrant forsocial migrants networksto gain or a in good theunderstanding media of thereis insuranceis an schemes.important role Clearly, to be played here by local government agencies in providing accurate and detailed information. In a recent research carried out in Tianjin Climate Change and Poverty Reduction Policies FOUR 66 higher climaterisks conditions exposeto with fragileecological The poorintheareas Climate Change of thePoortoCopewith Limitation ofCapability Ecologically fragile zones, also called ecotones, refer to areas where two different ecosystems meet. The ecological environment in a in environment ecological The meet. ecosystems different two where areas to refer ecotones, called also zones, fragile Ecologically 116 environment changes visibly. ecological where place a is zone a such So ecosystems. neighboring two the of parts central in those from different quite is area juncture FOUR Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy Climate ChangeandPovertyReductionPolicies National Ecologically Fragile Zones Fragile Ecologically National negative impacts on the livelihood of poor farmers. The farmers. poor of livelihood the on impacts negative more has change climate that obvious quite is it thus areas; these in environment the of frequent climate-related disasters that are caused by climate change lead to deterioration and erosion soil deteriorating vegetation, and forestry shrinking drought, intensifying as such disasters and change climate to sensitive highly mostly are areas Poverty-stricken zones andpoverty-strickencountiesinChina(Fig.9). fragile ecologically of overlap high a indicated also Oxfam jointly and Greenpeace by published report A 2008). Protection, Environmental of (Ministry zones fragile ecologically in level located are them of national 80% over 592 and parts western China’s and central in are productivity. countries poverty and capacity in ecosystem located low were very counties with areas poverty-stricken most Moreover, of counties. population total the poverty-stricken of 81% about zones for sensitive accounting counties, ecologically in poverty-stricken in population lived total the of 74% that showed (1997) al. et Zhou Li by Studies etc. livelihoods, adaptive and technology, capital, human resources, natural from challenges various facing are and change, climate of effects negative the to adapting in difficulties particular have zones fragile ecologically in farmers poor China, In subsistence the reduce vulnerability ofpoorpopulation. help to needed are risks, climate mitigate to building capacity as well as system prevention and system early-warning and forecasting risk climate of development the including and interventions, capital external Consequently, resources, support. by technological restricted are drought, resist to technology water-collecting and system farming as such situation. farmers, poor by vulnerable taken more adaptation a proactive into Furthermore, pushed is population poor the that so farmers, poor for costs living extra sometimes produce and may production of pasture, modes and diversified zones, on restrictions forestry place to development land as farm such returning change, and reduction climate of emission effects negative the mitigating for policies reality, of In frameworks. effects policy relevant negative in reflected the been not has mitigating change to climate contribution their hand, disadvantageous other the various on to while due limits; change, climate of risks the to exposed one easily the on hand is population poor the change, climate against battle prolonged the During the east, covering 21 provinces (autonomous regions and municipalities) of Heilongjiang, of municipalities) and regions (autonomous provinces 21 covering east, the in ecotone water-land coastal the and Plateau Qinghai-Tibet the southwest, the in areas mountainous south, the in areas hilly north, the in regions arid and semiarid in mainly are areas These 2008). Protection, Environmental of agriculture-animal (Ministry ecotone transition water-land mountainous Southwest coastal the and the ecotone erosion complex Plateau Qinghai-Tibet the ecotone, husbandry ecotone, desertification and karst Southwest the ecotone, mountainous and hilly red-soil Northwest South the the ecotone, desert-oasis ecotone, husbandry agriculture-animal North the ecotone, forest-grass of China (MoEP), lists eight national ecologically fragile zones fragile ecologically national eight lists (MoEP), China of , issued by the Ministry of Environmental Protection Protection Environmental of Ministry the by issued , Program for Protection of the the of Protection for Program 66 , namely, the Northeast Northeast the namely, , FOUR Climate Change and Poverty Reduction Policies 117 To enhance poor people’s people’s poor enhance To adaptability to climate change includes both proactive their enhancing adaptability to risks and response to vulnerability of livelihood due to macro policies of climate change mitigation The poverty alleviation in The poverty alleviation change view of climate enhance is essentially to poor population’s adaptability to climate change (the State Council, 2007) made special analysis of the impact of 67 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage prohibited exploitation. It is proposed to divide the national land into four categories of optimal exploitation, prioritized exploitation, restricted exploitation and Actually, ecological zones are facing quitedifferent capacities differentto deal with climatethe negative changeaffects thus riskscaused; thus, (2006)andLin Erdahavesuggested et al. taking different measures in accordanceecological with situationszones. in variousDue to theecological above-mentioned conditions and highpoverty-stricken overlap areas areasare of almost andunder areasthreat givenof extreme weather withthatand climate thechange fragile risks, peoplewhich are inmore likely to cause suchlivelihood vulnerability for these people, this chapter focuses on the analysis of this dimension and gives proposals accordingly. Therefore, the core issue of this chapterto climateis howchange to in includepoverty reductionthe strategiespolicy frameworks, alleviationadaptable i.e. strategieshow toin designrelation povertyto climate change, specificallyfirstly, the in frequentthe followingdisasters areas:caused by climate change andand fallingtheir back impactsinto onpoverty; poverty secondly, the responses to climate change governmenttaken andby thetheir influences on the livelihood vulnerability of thirdly, the the poorrestrictions population;on the poor population’s autonomous efforts for adaptability, sothat the effects of these efforts cannot be brought into full play; fourthly is how to set up a compensation mechanism for the poor population exposed and how toto help them climateenhance their capacities for risk changereduction, so as to risksenhance their autonomous adaptability to climate risks and eliminate their livelihood vulnerability due to macro policies on climate change mitigation. climate change on the poor population. In the preparationhad there been any studies of on the developmentimpacts of climate change on the programs,it poor, would have been useful to develop a compensation mechanism targeting the poor people. Moreover, ecological protective actions taken in poverty-stricken areas, including those taken in the climate change regime of the country, and the ecological rehabilitation measures, have contributed quite a lot to mitigating climate change. However, the contributionbeen reflectedhas ornot clarified in current poverty alleviation strategies, and consequently no livelihood for those especially developed been have policies compensation corresponding compensation for the poor farmers in these areas. Poor people facingliving in new ecotones challengesare resulting from China’s commitmentclimate change.to Onthe the mitigationone hand, of poor globalpeople in regions sensitiveneed to to enhanceclimate their change adaptability to climate change; on the other hand, look for theyalternatives for their need livelihoods, to to avoid losses induced by mitigation of climate change. Future poverty alleviation programs should include measures for enhancing the areas to adapt to climate change. capability of poor people in poverty stricken 67 In China’s previous poverty alleviation policies, there has been neither special attention to the poverty caused by poor adaptability to climate change, nor strategic research on adaptability to extreme weather events such as drought. Neither the above-mentioned program of protection of ecologically fragile zones noron national the zoning State Council’s guidelines Inner Mongolia, Jilin, Liaoning, Xinjiang, Hebei,Tibet, Sichuan, Yunnan, Guizhou, Guangxi, Chongqing, Shanxi, Hubei, Hunan, Jiangxi Shaanxi, Ningxia,Anhui. and Gansu, Qinghai, Climate Change and Poverty Reduction Policies FOUR 68 higher intheseareas poverty incidenceis weather events,thus possibility ofextreme have relativelyhigher climate changeand notable featuresof Ecotones areof 69 http://www.ce.cn/xwzx/gnsz/gdxw/200708/14/t20070814_12539942.shtml, www.xinhuanet.com, 1September 2007. http://www.help-poverty.org.cn/helpweb2/zhuyeneirong/d1134.htm, www.help-poverty.org.cn, 10 August 2004. 118 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy of natural disasters natural of to cope with climate change, and with current production and conditions, annual annual conditions, 21 and of half second of by end the in 37% decline will maize, production and rice wheat, as such current China, in with crops food main and of production change, climate with cope be to will instability its and decline will crops increased, influenced by global warming. If without taking positive andfood effective measures major of productivity the general, In direct economiclossofRMB151.4billion,doublethoseinthe sameperiodsince2000. a caused had municipalities) and regions (autonomous provinces 28 in floods the 2010, July of end the by example, for decline; to tendency a shown not have disasters natural earthquake, devastating the year.Unfortunately,previous and the in than more times 4 billion, RMB1,175.2 to up reached snowstorm large-scale extraordinary the including 1. Vulnerability caused by climate change risks: main main risks: change causes ofpoverty climate by caused Vulnerability 1. of natural disasters natural of losses total the in respectively 65% and 79% 63%, 48%, for accounted floods by caused losses economic direct the and houses collapsed roll, death population, affected the as such Indicators China. in year every billion RMB200 than more cost landslides and slides mud- sandstorms, floods, drought, as such disasters natural by caused losses Economic environments ecological fragile (Ministry ofEnvironmentalProtection,2008;Fig.9). extremely have all areas frontier and poverty-stricken areas, areas.The minority-inhabited areas, remote in lived whom of 95% than more 2005, in China in people poor absolutely million 23.65 were change There higher. is climate incidence to poverty and vulnerability, livelihood adaptability of victims become to weaker likely more are have thus and risks, areas sensitive ecologically in People Source: Greenpeace, Oxfam, 2009; Li Zhou, Sun Ruomei, Gao Ling et al., 1997. al., et Ling Gao Ruomei, Sun Zhou, Li 2009; Oxfam, Greenpeace, Source: Fig. 9:LocationofecotonesandpovertystrickencountiesinChina changing runoffs deteriorating desertification, melting frozenearth, Qinghai-Tibet Plateau: Province-level poverty-strickencounties State-level poverty-strickencounties Ecotones Ecotones 10kmwithinfromcoastline Ecotones 500mawayfromcoastline Coastline 68 69 . The losses caused by drought took up over 15% of the total losses total the of 15% over up took drought by caused losses . The . In 2008, the direct economic losses caused by natural disasters, disasters, natural by caused losses economic direct the 2008, In . etc.), disappearingbiodiversity torrential rain(mud-slidesandlandslides mountainous disasterscausedby Southwestern areas:deteriorating st desertification in evaporation,deteriorating shrinking glaciers,increase Northwestern areas: century. The fluctuation of food production in China in production food century. of fluctuation The seasonal drought floods, deteriorating more frequent Southern areas: water resources intensifying drought,shortageof notable increaseintemperature, Northern andnortheasternareas: water intrusion and waterlogging surges, deterioratingsaline typhoons, intensifyingstorm Coastal areas:risingsealevel, FOUR Climate Change and Poverty Reduction Policies 119 Northeast forest grass ecotone North agriculture-animal husbandry ecotone Northwest desert oasis ecotone hilly and red-soil South mountainous ecotone ecotone karst Southwest mountainous Southwest agriculture-animal husbandry ecotone Qinghai-Tibet Plateau complex erosion ecotone Coastal water-land transition ecotone Nationallevel Year 2007 (National Bureau of Statistics of China) Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 2001 2002 2003 2004 2005 2006 2007

8.00% 6.00% 4.00% 2.00% 0.00%

18.00% 16.00% 14.00% 12.00% 10.00% Percentage Fig. 10: Percentages of rural poor population in 8 major ecotones between 2001 and Fig. 10: Percentages of rural poor population Fig. 10 shows the poverty incidence in 8 major ecotones. Between 2001 and 2007, only the percentage of rural poor population in the Southecotone red-earth washilly andlower mountainous than that of transitionthe ecotonewhole and country,the Norththose forest-grass in ecotonethe the aroundcoastalpercentages of rural the poor water-landpopulation nationalin the level,other five ecotonesand were all higher than the national level. Those in the Qinghai-Tibet Plateau complex erosion ecotone and the Northwest desert-oasis ecotone were higher than the national level manner. in a most notable There will be also a substantial climate change impact on water resources the in future.China Firstly, in water flow may be reduced in northern provinces and in regionsNingxia like and Gansu in the next 50-100 years, whilst in southern provinces like Hubei and Hunan there will be an increased probability of flood and drought occurrence. Secondly, shortage of water resource in northern areas in China will not be beneficial, particularly in relation to conflict due to water resource shortage in Ningxia andbecome Gansu, whichmore will severe, in the next 50-100of wateryears. resources,Thirdly, mostwith provincessustainable in utilizationChinaresource supply and demand, will but conflicts between water supplymaintain and demand will come a balance between water more prevalent in Inner Mongolia, Xinjiang, Gansu and Ningxia in the next 50-100 years Commission, 2007). (China National Development and Reform The agricultural crops production structure will be changed due to climate change, with a wheat, planting of ratio the example, for allocation, products agricultural overall in change rice and maize in different regions will be changed. Some research has also concluded that there will be negative coolimpacts environment, on forcrops example, planteddecline inin potatoof Ningxia (Sun Fang, 2008). mountainous areas ecotones production withplanted a in relativelythe southern will be influenced by climate change and extreme weather10% in disasters,the past increasingto 20%, fromeven to 30% in those most unfavorable years (Lin 2006). And the Erda reduction of et food al, production may have impacts on poor people with little assets accumulation. financial Climate Change and Poverty Reduction Policies FOUR ecotones of poorpopulationin livelihood vulnerability direct impactsonthe climate changehave disasters andcumulative Both unexpected 120 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy of maizewashitbythedisasters. mu million 3 over and 2005, in attack pest insect and drought into developed eventually Ningxia in temperature high persistent The herdsmen. and farmers local and the for farming grazing impaired have changes These Region. Autonomous Hui Ningxia County, Yanchiin temperature and rainfall in changes the 11shows Fig. 1980s. the since rainfall scanty Northwest and temperature higher from suffered have the ecotone husbandry agriculture-animal in grasslands arid and semiarid The 2010). Hetao, (Gao disaster the to due half a than more by decreased had province the of yield grain the and drought, by hit been Yunnanin had crops Province winter-sown autumn-and of mu million 30 than more 2010, February By drought. severe by hit also were Gansu and Qinghai Tibet, Sichuan, Guizhou, as such regions autonomous and provinces while drought, by severe hit extremely was Province Yunnan regions. autonomous and from provinces other Yunnan 16 suffered from to spread have Province has drought Southwest and the temperature, high of and parts rainfall scanty eastern continued the 2009, of autumn the Since temperature. high and rainfall scanty extremely in resulting China, in areas southwestern most in convection and cover cloud on impacts significant had 2009 in Niño El effects. cumulative such to due change qualitative cause may events weather Specific Center). Principal Yu, (Chen drought of Climate National of causes Division Services and Climate Applications Technologyfor Specialist immediate are temperature high and rainfall scanty and effects, cumulative such has Drought overlooked. be cannot change climate of impacts cumulative the nevertheless, livelihood; people’s on impact visible most the have events weather extreme that true is It population. poor the of vulnerability livelihood the on impact great a has also change climate cumulative that noteworthy is However,it disaster-induced brief, In 95%. poverty isamajorfeatureofruralinChina. reached rate relapse the regions, worst-hit the of one Town,Bishan in areas agricultural the respectively.In 85% and 90% were rates relapse by decreased the yield population, poor and grain households poor of the number the and by calculated year; that 1993, 31.5% in disasters natural severe by hit was areas mountainous Qinba the in County Pingchang 20%. than higher as is Province Guizhou in agricultural to areas rural damage in rate relapse year, the the famine a In in drought. and floods by made increase production 10% every with 2-3% by increases incidence poverty rural that showed others and Xiao Zhang by out carried drought and floods and poverty rural between poverty. relationship into the back the of falling Studies of cause major were disasters natural and poverty”, serious disasters–more severe poverty–more “disasters– of track a in formed was circle vicious a thus development, economic low and ecosystems vulnerable with areas poverty-stricken that the in worse it made disasters natural indicated (2007) Yonggang Xie poverty. of causes root the were disasters natural poverty in China, Guo Yongzhong (2002) found that harshto natural conditions and frequent returning farmers of 55% 2003, in poverty in that year had been hit by natural disasters. When analyzing the causes of rural Statistics of Bureau National the poverty by to returning conducted of survey the to according that out pointed (2007) al. et Nie Zhongqiu disasters. natural by caused is poverty into slide-back the of 70% About population pressure. and disease serious disasters, natural namely, poverty, into sliding-back of causes direct three are there that out pointed (2005) Jiayan Li areas. these in natural incidence frequent as ecotones poverty higher a to leading and above-mentioned poverty of cause major the becoming are which disasters the in manifested are risks Climate FOUR Climate Change and Poverty Reduction Policies 121 Climate risks of an ecotone and the idiosyncratic shocks for the farmers in the area have impacts on Annual Annual precipitation Annual average temperature . 70 Year Year Autonomous Region, 1954-2007 Autonomous Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage 1954 1961 1968 1975 1982 1989 1996 2003 0 1954 1960 1966 1972 1978 1984 1990 1996 2002

9 8 7 6 700 600 500 400 300 200 100

11 10

Unit: millimeter (mm) millimeter Unit: Unit: Celsius (℃) Celsius Unit: Agricultural University in March 2010. The data Adaptation is to from Climate the Change” survey conducted of by “Social College of Humanities and Development Studies, China Fig. 11: Changes in annual temperature and precipitation in Yanchi Country, Ningxia Hui Ningxia Country, Yanchi precipitation in temperature and Changes in annual Fig. 11: In ecotones, the rural poor population is confronted with higher livelihoodwhile vulnerabilityhaving lower capacity to resist climatereduce change theirrisks. Itlivelihood is equally vulnerabilityimportantstrengthen to financial andsupport. Actually,enhance climate change theirrisks can risk-resistingvulnerabilityworsen the livelihood of capacitythe poor andpopulation. climate change more adequately through capital Farmersaccumulation and enhancement of daily in some areas can resist so of that climate the change negative can effects be reduced. For risk-resisting capacity, unexpected example, the living standard of farmers in a village in Zhangbei Hebei County, Province basically remained the same when the village was hit by a severe drought in 2009 and suffered a total failure of wheat. This was thanks to the grain reserves and income from working outside the village, which provided enough for daily use 70 Most poor farmers in ecotones are unable to mitigate the negativerisks due to limited impactscapability of assets accumulation. ofThe case of climateShui Village in Gansu Province shows that poor farmers have to use additional capital, including their selling off material capital, to counter drought disaster, the biggest risklivelihoods for(Tang Lixia, them,2009), andand tothis significantlyrestore reduces poor farmers’ capacityreproduction, and increases their vulnerability for the next strategic cycle of living. for Climate Change and Poverty Reduction Policies FOUR livelihood vulnerability time, worseningthe population atthesame the livelihoodofpoor 122 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy effects, e.g. infectious diseases and long-term psychological problems. The risks of of risks The problems. psychological diseases ormalnutritioninducedbydroughtwillbeincreased (Kovats,2005). long-term and diseases infectious e.g. effects, indirect and storm, and landslides, flood, by injury,induced and death e.g. effects, direct weather which within health, on disasters have the most direct impact on the health of people in poor areas. For example, change climate of impact of types various are There great animpactonurbanresidents. so have not did it but people, rural of vulnerability livelihood the worsened mainly 2009 in China Southwest the hitting drought the instance, For events. weather extreme by hit are they if even adaptability stronger have there people the thus, areas, rich relatively in frequency low care medical and a infrastructure reserves, material better are of there and ecotones, outside are events weather Extreme household. rural single a and of diseases drought sudden as and starvation such injury, as such events shocks idiosyncratic to weather related closely are extreme floods of shocks covariate the ecotones, in but farmers, population of poor the for Therefore, influences. livelihood same the the have also on may risks cumulative influences only important Not have ones. events covariate weather through extreme shocks idiosyncratic increase can change Climate on thevergeofpoverty. population the and lower population poor and the of resources livelihoods the to impair eventually and security,population poor the for access reduced in result may change climate accounts, all On disasters. natural by caused care medical of unavailability and traffic blocked by limited is livelihoods and their restore to population poor disasters; the of capacity the severe by damaged be can weak, already reserves, material floods; or drought by hit when poorer even gets productivity low with land impaired; are activities productive diversified deteriorate; poverty influencing factors the change, climate to Due these impacts. more even is by caused cycle vicious the shows 5 Box extent. considerable a to areas these in women farmers of of conditions living vulnerability the impairs and areas, minority-inhabited and livelihoods outlying in remarkable the for risks climate of threat The Source: Hu Qiang, 2005. Qiang, Hu Source: more burdens in agricultural production and living, as well as risk resistance and and resistance risk as well as restoring livelihoods. living, and production shoulder agricultural to in have burdens women more while families, their of vulnerability livelihood the reduce to work to out go often men resources, deteriorating by caused mud-slides as such risks frequent more Facing activities. productive income-creating other in participate to opportunities losing thus firewood, cutting and water fetching and finding to as such Due men family. a in activities, decision-making activities non-productive on time productive more and spend to have women resources, deteriorating the training of education, most to out access carry dominate village the in women Though Box 5:Climaterisksandotherfactorshavejointlyimpairedthelivingofwomenina village onLancangRiver FOUR Climate Change and Poverty Reduction Policies 123 Health risks Economic risks Economic Disease food intake Harvest failure Decreased income & Decreased income rely on Death of livestock Reduced buffer stock to Reduced buffer (Box 6) gives a more vivid description of how climate change change how climate (Box 6) gives a more vivid description of Fig. 12: Relationship of various risks of various Fig. 12: Relationship 71 Drought Human death Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Box 6: How climate change risks worsen the livelihood vulnerability Box 6: How climate change risks worsen Life cycle risks Natural risks Although neighbors who have food reserves give them a hand to ensure their basic needs for food are satisfied, they are forced to stop their assistance when theharvest next is affected by an extensive drought (covariate shock). As she waits for relief assistance to arrive, she pulls her older children out of school and sends them to live with relatives in the city to look for work. A family which makes its living from farming less than a hectare a A of blow land suffers when the husband is killed in a traffic accident (idiosyncratic shock). His wife, mother to six children, must care for the children and employs another person to cultivate her land on a crop-sharing basis, where each gets half of the harvest. However, due to the decline in yields of sweet potatoes, the employee leaves for better opportunities, land uncultivated. leaving the woman’s Swedish International Development Cooperation Agency (SIDA) as the Chairperson. Swedish International Development Cooperation The Commission on Climate Change and Development consists of 13 renowned individuals, with Mdm. Gunilla Carlsson, Director of the Source: Christoplos et al., 2009: 8 71 Fig. 12 shows how climate change risks can cause death of livestock and harvest failure, thus resulting in diseases and life risks. An example from the CommissionChange and Development on Climate In reality, the risks that cause poverty are mainly idiosyncratic, including pure idiosyncratic idiosyncratic pure including idiosyncratic, mainly are poverty cause that risks the reality, In risks and those gradually becoming covariate ones. Households and communities that Climate shocks. covariate to vulnerable less are shocks idiosyncratic to resilient more are change first affects the natural capital of various individuals or families in an area, then further affects their human capital, material capital and financial capital; such impact will in turn worsen idiosyncratic shocks, such as disputes over land caused by declining land deterioration productivity, of health due to lack of food, and failure in future credit due to being unable to repay small loans because of total harvest failure. Therefore, enhancing the capacity of resisting idiosyncratic and covariate risks by communities and individuals risks influence various conditions and eventually worsen the vulnerability of poor families. Climate Change and Poverty Reduction Policies FOUR climate changerisks special attentionto strategies donotpay poverty alleviation However, theexisting ecotones of poorpopulationin livelihood vulnerability direct impactsonthe climate changehave disasters andcumulative Both unexpected 124 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy lack ofpublicservicefacilities,poorindustrialstructureandurbanization. natural to the to due due options livelihood limited more has ecotones in harvest population poor The disasters. good a have cannot they when employment for cities into rush may farmers more since change, climate to due markets labor in competition fiercer face the to due will labor.farmers of Landless division gender traditional the from activities resulting burden heavy other in participate obtain or cannot activities, they non-agricultural conduct example, to for credit resources, public of systems various from excluded often are they more since conditions, even living unfavorable affected more face are to have groups Womenseriously. Vulnerable facilities). draining and irrigating as (such infrastructure necessary of lack the to due alternatives as crops other or crops traditional plant cannot farmers floods, and drought frequent Facing options. living their reducing by vulnerability livelihood their increases primarily change climate population, poor the For is asimportantimprovingcentralandlocalgovernment’s capabilitytocontrolrisk. Existing poverty alleviation funds play different roles in reducing the livelihood livelihood the reducing in roles different play to adapt population poor the help them of funds some and population, poor the of vulnerability alleviation poverty Existing of capability adaptation ofthepoor. the enhance to both poor are the projects and by policies measures of Interventions adaptation population. upon based be will policies these course, Of risks. capacity including policies, building for the poor population and a living security system that mitigates climate change adaptation feasible by vulnerability such reduce then and risks, change climate under vulnerability livelihood to exposed be to likely highly are who poor of groups identify to need Firstly,we important. very vulnerability become risks change climate mitigate effectively livelihood can that the policies of relevant of implementation causes and preparation main the population, the are risks change climate If environment andharmonyatahighlevel. standard, living village’s the maintain help efforts these grazing.All unified for measures as well as to planting, trees land and grass farm in grasslands to returning pasture for the returning and compensation forestry the from water investing use, channeling daily for including River Yellow the improvement, grasslands in village it action the importantly, collective more and takes Alleviation, funds, Poverty development and community of operation Environment the for strengthens Center microfinance Ningxia the the by of Supported project self-management. and self-organization for strong a capacity has drought, by affected often and ecotone husbandry agricultural-animal an in village typical a Region, Autonomous Hui Ningxia in Village Kutuan resources. other from support and aid requires often which action, collective for capacity certain a needs seas and water underground forests, as such resources public of management effective to publicresources,willbeaffected byclimaterisksinamoredirectway. Continuousand access or networks safety from excluded are who women, and minorities ethnic as such groups and Individuals risks. rely climate facing to when have resources community people or individual and on change, climate to mitigate and capacity to, adapt limited to have resources often mobilize ecotones in governments Most reliability. such will reduce shocks covariate however, networks; safety strategies, community on more adaptation rely farmers general poor In adaptability. internal communities’ into transformed not are they if risks, climate by caused vulnerability livelihood reducing in assist always cannot activities these change, climate to adapting for measures internal communities’ and aid external of spite However,in change. climate of impact the counter to measures intervention taken have levels all at governments indifferent, being of instead Actually, 2. Povertyalleviationstrategiesandclimatechangerisks FOUR Climate Change and Poverty Reduction Policies 125 Microfinance enhances Microfinance enhances adaptability of farmers, but is insufficient with for them to deal unexpected disasters Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Box 7: Role of the microfinance in reducing livelihood vulnerability of farmers Box 7: Role of the microfinance in reducing Farmers in Zheguyuan Village of Liguan Town in Xingren County of Guizhou Province of County Xingren in Town Liguan of Village Farmers in Zheguyuan reclaimed wasteland and plantedreceived any oversmall loans, they 3,000had to cut downyews and sell 15trees as yearstheir main of income. source However, each yew ago.could be sold only Beforeat a price of RMB50~200, but theythe price would increase to RMB1,000 each if it is cut down at the age of 20 and above. Thanks to small loans, they began to plant vegetables 3 years ago, the income from which has gradually become the main source. The farmers no longer cut down trees; instead, they can reserve the yews as a source of future income. Nevertheless, they still have to cut down yews that are supposed to be an asset reserve, when the yield of vegetables is affected by plant diseases and temperature. insect pests caused by changing Livelihood Vulnerability of Farmers. Rural Economy, 2008 (4). Source: Liu Yanli et al. Case Study on Influence of Microfinance on Reducing Industrial poverty alleviation activities aim to boost the sustainable livelihood of farmers and communities. They are by nature providing farmers with help similar to alternativelivelihoods to avoid climate risks. Nonetheless, these activities cannotpopulation reachwithout theadaptability, poordue to the limits of various conditions. As Boxdescribed 8, in farmers who cannot receive aid for industrial development to havecontinue no with choicetheir traditionalbut planting and their losses cannot be compensated the with yield of greenhouse crops. Moreover, the above-mentioned microfinance funds are Of the many types of poverty alleviation loans, small loans can directly reachthus boost farmers, the diversity of income sources of poor farmers by capital and technological support and create conditions for diversified ways of living and capital accumulation for farmers (Box 7). Diversification of livelihood is a rational option for farmers to avoid risk, whilst capital accumulation can help them deal with bigger risks. Microfinance projects in some places also provide loans when clients mitigatesuffer fromrisk impacts.unexpected The disasters,comparison to between project showed villages that the borrower from the project could withstand severe natural disasters more and ordinary villages successfully than farmers who had not participated in the project, and was less affected in consumption level by disasters (Wu Guobao et al., 2003). However, farmers cannot avoid losses of material assets in unexpected disasters when microfinance projects are in progress. Under such circumstances, it prevents farmers from and borrowing formingfrom the newprojects; therefore, the groups livelihood vulnerability of farmers cannot be reduced and these farmers will remain poor. Inown limits otherin mitigating words,the negative microfinanceeffects of climate change hasrisks on its poor population, for example, it cannot take the place of micro-insurance when severe natural disasters occur. climate change in one way or Nevertheless, another. current ideas of poverty alleviation, in general, do not take climate change risks into consideration theas the livelihoodmain causes vulnerabilityof of poor farmers;do nottherefore, give preferencepolicies, to themeasures groups mostand likelyfunds paperto begives exposeda roughto analysisclimate of risks. the This functions of various from povertythe perspective alleviationof mitigating measuresclimate risks, mainly including microfinance projects, industrial poverty alleviation, poverty alleviation through voluntary alleviationmigration and poverty alleviation in the form of providing job efforts for a whole village,opportunities. poverty Climate Change and Poverty Reduction Policies FOUR 126 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy to riskswithunpredictableweatherorwhenpricesfluctuate. other exposed easily more the be will farmers on and production, of diversity the while reduce may it 9), hand, (Box by vegetables guaranteed for is greenhouses it enhance as if such can risks, facilities, climate agricultural production including risks scale natural hand, to respond one to the capacity on the then production; scale promotes alleviation poverty industrial Besides, livelihoods. alternative support cannot thus limited, Source: the State Council Leading Group Office of Poverty Alleviation and and Alleviation Poverty of Office Group Leading Council State the Source: Source: The survey of “Social Adaptation to Climate Change” conducted by College College by conducted Change” Climate to Adaptation “Social of survey The Source: Development (LGOP) Synthesis Report of Program for Poverty Alleviation and and Alleviation Poverty for Program of Report Synthesis (LGOP) Development of Humanities and Development Studies, China Agricultural University in March 2010. March in University Agricultural China Studies, Development and Humanities of Development in Rural Areas of China, 2009. China, of Areas Rural in Development channeled fromthe Yellow River. water of reduction the and drought to due failure in results even or declines crops of yield when trapped, are others the which in situation the avoid can farmers planting system, agricultural effective and water-saving the a to benefit Thanks process. the greenhouses from with lot farmers so expanding, keeps fruits and market the vegetables people, in local the of diet the change to fruits and vegetables the of about benefits talks and project supply food non-staple the promotes government local the As years. recent in crops economic as prices higher realized have and rain, little with or drought in even harvests stable relatively have plants castor-oil and Sunflower watermelon). and tomato (cucumber, crops greenhouse three and in plant) castor-oil engaging 4 than and (sunflower more crops drought-resistant two plant plant them of (mainly 5 all and crops, households of varieties medium-vulnerability 8 the of vulnerability households) (5 50% lowest the of vulnerability.Over high of 51 is other the and vulnerability medium of 8 transportation), household one Region, Autonomous Hui Ningxia of Village Guantan in surveyed households 60 the Among Box 9:Facility agriculture to reducing the livelihood vulnerability to climate vegetable greenhouseanymore. a afford cannot family the project, the after home at water running and tank methane a had they Though relocation. and migration of project the in participate could that they so finally, 000 RMB20, nearly got and 30%), of rate interest an (at sharks loan ability.financial of terms and friends from borrowed and 2003 in ox an sold family The in level middle the at is and members four has family Gencai’s Pei named villager a example, For project. this in participate cannot households poor year.Therefore, per guidance technical for RMB150 about pay to has also greenhouse. Additionally,he a RMB9,000 for With RMB5,000-9,000 pay to one. has farmer a government, by provided 100-meter-long loans subsidized a for RMB17,000-18,000 and meter-long 50 a greenhouse build to needed is RMB14,000 of total A meters. 50-100 of length a with and wide meters 10 about is greenhouse this Afarmers. for for high rather threshold is project the However, village. the in wealth creating for means an important are greenhouses and committee Party Municipal the of secretary deputy the by designated point alleviation poverty a is village the since easily, relatively village the farmers. from the specialized loans are for poverty alleviation. The greenhouse project was won by with funds project The popular village. the in very greenhouses 36 are about altogether are of there greenhouses Currently income the net Thus, a year. produce every can RMB10,000 greenhouse vegetable Each development. industrial its in greenhouses vegetable on focuses Province Shaanxi in Village Bujia Box 8:Exclusionofpoorpopulationfromindustrialpovertyalleviation FOUR Climate Change and Poverty Reduction Policies 127 Poor population faces more restrictions in poverty alleviation through voluntary migration The farmers most The farmers most vulnerable to climate change cannot benefit from poverty alleviation projects of village approach . 72 (State Council Leading Group Office of Poverty Alleviation and Synthesis Report of Program for Poverty Alleviation and Development Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Prefecture of Yunnan Province, conducted by College of Humanities and Development Studies, China Agricultural University in 2005. Province, conducted by College of Humanities and Development Studies, China Yunnan Prefecture of The data comes from the survey of the interim assessment of the poverty alleviation projects for a whole village in Dali Bai Autonomous Poverty alleviation measures through voluntary migration include removal and relocation of a whole village or community, ecological migration and so on. Though relocationremoval and of a whole village or communitylivelihood vulnerability and sensitivity to vulnerable ecosystem of the andpoor population into ecological migration have taken the consideration, there are still cases where poor people are excluded from these policies due to the limits of their material, human and social capital (Tang Lixia, 2003). describes such limits. Box 10 Moreover, Moreover, some poverty alleviation projects for a whole village even cannot play role in some cases. For example, a a survey in Maduo County of Qinghai Province showed full that some poor households could not get preferential treatment from the village based poverty alleviation project, since they were withingrasslands (Chen Jie, 2009). the project of returning pasture to 72 According to the Poverty alleviation projects for a whole village gain significant achievements in resources integration, promoting community andefficiency of resources, butlocal do not give sufficient consideration toparticipation reducing the livelihood and increasingvulnerability utilization caused by climate risks, developmentsince of communities.the However, projectsclimate change risks focuscan reduce morethe effects onof the and measures to a great extent. poverty alleviation policies general Development, 2009), poverty alleviation projects for a whole village are all based upon village-level poverty alleviation plans, and most of them are proposed by village cadres and villagers through participation. The projects are mainlyroads, concerneddrinking with water,issues bio-gas,of migration and Fromrelocation the cases andstudied industrialin the report,development. we can see that theclimate farmers mostchange, vulnerable i.e.to those who have not engage enoughin diversifiedmaterial livelihoods, reservescannot benefit orfrom theselabor projects.force For bio-gas instance,toproject planned the by the village development program through the participation of farmers, which requires that participants have their own facilities, while the households that cannot provide enough counterpart funds due to the low level of living capital cannot benefit from the project. The same issue exists in the house construction project as well: with a subsidy of RMB2,000-3,000, some farmers may scrape up the counterpart funds of RMB5,000-10,000, but they will be trapped in a difficult unexpected situationcost during As construction. a onceresult, there are therehalf-constructed new houses is any in some villages. Thus on the one hand, the project drains farmers’ limited funds; on the other hand, these farmers have to live in a vulnerable environment, but with increased livelihood vulnerability they cannotdisasters such as mud-slides break out avoid falling into climate poverty when natural in Rural Areas of China Climate Change and Poverty Reduction Policies FOUR 128 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy Source: Regional Economy Division under National Development and Reform Commission, “National Work-relief Policy”, Policy”, Work-relief “National Commission, Reform and Development National under Division Economy Regional Source: watershed management Integrated Small human andlivestock Drinking waterprojectfor villages counties, townshipsand Road constructionin construction Farmland capital Total water conservancy Small-scale irrigationand Project Monitoring Report of Rural Poverty in China 2008, China Statistics Press, 2008. Press, Statistics China 2008, China in Poverty Rural of Report Monitoring conditions ofpoorhouseholdsdirectly. living the improve livestock and humans for projects water Drinking market. the into enter efficient more to them enables a villages and townships counties, in in 11).construction (Box Road manner temperature total and water land, to as such population resources poor natural the for utilize and temperature and rainfall of distribution unbalanced the improving for conditions create construction capital farmland and conservancy water and irrigation small-scale while management, watershed integrated small capital and farmland construction conservancy, water and irrigation in yields direct no have funds relief work- the that Tablerole. shows their 5 play better can resources that so infrastructures, various of establishment the through resources no natural various give of combination but effective general, more in a promote to is tool population main The risks. poor climate to adaptation the to consideration for special infrastructure pay to only access they to though even attention practice, in extent some to change climate to enhancing adaptability in positive are alleviation, poverty of measure a in as investment generation as employment such measures, and policies alleviation poverty some Nevertheless, Source: LGOP, 2009 LGOP, Source: tank, tap water and community greening. More than 42 households need to move, move, but pooroneshavetoquitastheycannotafford theremoval. to need households 42 than More greening. community and water tap tank, subsidy of RMB9,000 in total. The subsidy is mainly used for house building, methane migration a get can members 4 of family a policy, subsidy this With member. family poverty the alleviation financialfunds,i.e.RMB5,000foreachhouseholdplusRMB1,000 from subsidies “5+1” has the get can household they in then every cash, and but in RMB17,500 project, pay gullies to the in for living register can farmers dwellings the pit all basement-like Province, Shaanxi in County Chunhua in TownshipBujia of Village Bujia in out carried project relocation and migration the In Box 10:Exclusiononpoorpopulationduringmigrationandrelocation Table 5.Investmentandeffects ofthework-relieffunds National funds 302 641 179 35 64 61 Funds (unit:RMB100million) bonds Govt. 108 217 15 20 16 58 counterpart funds Local S148 292 17 29 29 69 Total 450 933 248 52 93 90 persons/10,000 10,000 km 10,000 mu 10,000 mu 10,000 mu 10,000 km 10,000 heads Unit 2 Effects 4,200/3,000 Amount 2,480 8,000 8,000 45 4 FOUR Climate Change and Poverty Reduction Policies 129 climate risks Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Box 11: Water conservancy facilities in reducing vulnerability to vulnerability facilities in reducing Water conservancy Box 11: The per capita area of irrigated land is 2.5 Autonomous Region after the village mu channeled River water 10 from years the Yellow in Guantan Village of Ningxia Hui ago, and its grain output has been increasing steadily. Compared with villages with only arable dry land, Guantan Village can respond more adequately to a changeable climate. Villagers use the maize grown on irrigated land poultry, thusas savingfeed RMB8,000for livestockon feed and costs every year, which can make and help them develop animal husbandry. shortage of cash income up their Humanities and Development Studies (COHD), China Agricultural University in 2010. Source: the survey of “Social Adaptation to Climate Change” conducted by College of The policies for nature reserves have multiple influences on the people concerned. In the management of many nature reserves, there are measures of ecological compensation and alternative livelihoods, instead of supportingsimple policiesprotection give forlittle nature.consideration However, topopulation thesewho, thetherefore, are livelihoodexcluded to some extent. vulnerabilityBox 12 describes the of situation the poor in a nature reserve in the Sanjiang Plain, where the villagers lose their income from crop farming as well as the policy subsidies for grain growing. The policies and supplementary measures for ecologically sensitive areas cannot reduce the livelihood vulnerability of the poor population, but rather can of increasethe the poornumber population. In the program forfor the national19 key areasecotones, of the the8 national regionalecotones focused programsmore on actions. The ecologicalNational strategy protectionfor copying with climate change in China (2007) presents the objectives of adaptation to climate change, of includingtypical foresteffective ecologicalprotection system ofand 90%national focused wildnature animalsreserves andaccounting plants, for and 16% of country land areas, analysis preliminary a make could we cases, andpolicy In rehabilitated. being land decertified 22 million hectares of of the impacts of the current macro policies on the livelihood of the ecologically sensitive areas. poor population in 3. Mitigation of climate change, adaptation policies and livelihood vulnerability To sumTo up, we can use current poverty alleviation strategies and relevant policies and measures for reference in mitigating climate change attention to risks,such risks when developing future policies, butespecially for the population wewho need to pay more may be excluded, and take more direct and effective policies and measures, to reduce the vulnerability of the poor population. more effectively Climate Change and Poverty Reduction Policies FOUR 73 130 China has set objectives on carbon emission reduction, which is that CO that is which reduction, emission carbon on objectives set has China with thatin2005. Itisacontrolledindicatorbeing listed inmid-termandlong-termnational economicandsocialdevelopment planning. Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy husbandry, a straw planting promoting project for agriculture, a protected agriculture agriculture protected a forestry.and here husbandry problem animal The for animal project planting grass a and project agriculture, for for project project promoting pen-feeding a planting with straw a operated husbandry, is grasslands to land farm returning project the example, For projects. or policies these of plan general the in included not are operated in an isolated way, but together with other agriculture-supporting projects, which compensation type. this of is system benefit Actually,not are change climate to related projects and policies the ecological forest The policies. future in or included be compensation can such subsidy of contribution ecological the that so projects, some in subsidy change benefit ecological climate of implementation and ideas the from learn However, still risks. can we mitigating to contribution farmers’ consider not do and ecological compensation, really not are population, poor compensation the for the ecological compensation of economic nature measures in extent, mostly these that some is to point key The 13). farmers Box of compensation (see vulnerability livelihood the reduce ecological help necessarily not climate provide does of compensation all mitigation they to related Though projects or change. policies ecological some shows 6 Table including technicalsupport. payments, transfer various with population poor the provide of should we period Therefore, time. certain a within extent some to population poor the of the vulnerability increase livelihood will measures these All 2009). al. et Ming (Su respectively 1.92 and 0.25 be will it areas urban in that and rates, and tax maximum 0.44 and minimum be at respectively will 3.21 percentage decreased accumulated will the areas that policy. rural and in tax gradually income decrease carbon discretionary on that finds analyses research dynamic this forecasting of did result The Finance of Ministry the of Research Financial measures. Institutes these with along will coming There policies macro grasslands. of and series a woodland be of productivity the includes enhancing and sequestration energy carbon afforestation clean increasing and of biofuel measure of the using Additionally, areas. the rural promote in to aims sources carbon reducing of have new requirements, which are closely related to rural livelihoods rural to related closely are which requirements, new have change climate mitigating of promises policy the policies, ecological existing the Besides compensation for methods and ecologicalcompensationtoreducingthelivelihoodvulnerabilityofpoorfarmers. the relate to important very is It ecotones. for program the in described even is which compensation ecological to given been has attention Much Source: Wang Libin et al., 2009: 107-108 2009: al., et Libin Wang Source: of the forestry administration, and farmers are not allowed to plough the land. (An (An land. the plough interview withavillagerof Yongfeng to Village) allowed not are farmers and administration, forestry the of (direct management the subsidies” under is wetland now, the But “two subsidies). grain comprehensive and receive also can and unrecoverable is administration, land the by approved as land, The approval. the for RMB50/mu) paying of fees after reclamation the cultivation under wetland bring could farmers 1994, and 1989 Administration Land (during Raohe to money of amount small a paying after plough could from Yongfeng Jiahe VillageTownand reserve. They nature the in farming for in went people past, the In all. at benefits No us. with do to nothing has reserve nature The Box12:Ecologicalprotectionandopportunitycostoffarmers’livingin 2 emission will be reduced by 40~45% in 2020 when comparing when 2020 in 40~45% by reduced be will emission nature reserves 73 . The measure measure The . FOUR Climate Change and Poverty Reduction Policies 131 Other livelihood beneficial to opportunities Carbon sink trading Forest carbon sink trading Carbon emission permits trade mechanism for forestry ecological benefit Compensation for their contribution to farmers’ livelihood or farmers’ Supporting facilities Small loans for breeding activities The subsidy for returning farm land to forests is not less than RMB200/mu. By the end of 2008, every household involved had been subsidized on with RMB5, 113 average. The subsidy standard is RMB5/mu (there are extra subsidies in economically developed provinces) Requirements of or restrictions on farmers’ livelihood farmers’ Surplus of breeding and planting Supporting facilities Technology No agricultural conducted activities Expenditure on afforestation Protection of ecological public forests mitigation Covered area Contribution to climate change Contribution to climate As of 2008, there had been 30.5 million rural households with home based bio-gas and 24,000 households under small-scale bio-gas projects, as well as 12,000 rural energy management and service organizations, 38,000 technical professionals and 227,000 skilled methane technique workers Reduction in carbon emission By the end of 2008, the area had totaled 403 of affrostation from investment with mu, million the central government totaling The projects RMB196.1 billion. had covered 25 provinces (municipalities and autonomous regions) and Xinjiang Production and Construction Corps, with over 32 million rural households of 124 million farmers Increase in carbon sources Ecological benefit compensation compensation benefit Ecological 11 was first launched in provinces and autonomous were funds The 2001. in regions set up in 2005 and reached up to over RMB20 billion by 2010, and 700 million mu of key ecological public forests had been covered by the funds of compensation Increase in carbon sources Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Policy/ project Table 6. The ecological policies or projects related to mitigation of climate change and farmers’ livelihood of climate change and farmers’ policies or projects related to mitigation The ecological 6. Table Bio-gas project in rural areas Returning farmland to forests Funds for forest ecological benefit compensation In general, during decision-making and implementationadaptation to climate change, if there is no specific consideration on climatic risks in poor of policies on mitigation and livelihood vulnerabilities. livelihood, it won’t be helpful for alleviating people’s is the uncertainty and lack of clear mechanisms for ecological compensation,effects dependand uponthe how a local government positions itself in for resource integration. its own capacity policies and implementing relevant Climate Change and Poverty Reduction Policies FOUR 132 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy reserves of nature Construction protection Wetland lands grass- pasture to Returning the and increaseincarbonsources Reduction incarbonemission December 2007 had reachedupto2,395by The numberofnaturereserves Reduction incarbonemission reserves hastakeninitialform. based uponwetlandnature protection networkmainly social development. A wetland the nationaleconomicand in the11th Five-Year Planfor Sanjiangyuan NatureReserve and theconstructionof wetland protectionengineering Government hasincludedthe Since 2006,theCentral Increase incarbonsources Qinghai-Tibet Plateau Yellow Riversintheeastof regions ofthe Yantze andthe as thegrasslandinsource Autonomous Region,aswell the northofXinjiangUygur Autonomous Regionandin in theeastofInnerMongolia Region, degradedgrasslands Ningxia Hui Autonomous Region, GansuProvinceand Inner Mongolia Autonomous steppe inthewesternpartsof up in2005,coveringdesert The projectwasfullystarted in corearea productive activities Restrictions onthe reconstruction Wetland prohibited Cultivation rotating grazing grass, regional to theamountof capacity according livestock carrying determining suspended grazing, seasonal Grazing prohibited, aids restructuring andother production technologies, update ofproduction alternative livelihoods, Relocation ofmigrants, alternative livelihoods Support forprojectsof households or forthemigrated suspended grazing areas ofprohibitedor households inthe compensation forthe as fencesorcash construction such infrastructure Subsidies for mu respectively. 2.75kg/mu and0.69kg/ Tibet Plateauare in theeastofQinghai- and the Yellow Rivers regions ofthe Yantze grassland in the source for householdsinthe of thetwosubsidies year. The standards grain of1.375kg/mu/ is subsidizedwithfeed and eachhousehold 3 monthsperyear, calculated basedupon suspended grazingis mu/year. Seasonal feed grainof5.5kg/ is subsidizedwith Each household the firstthreeregions. through theyearin Grazing isprohibited mechanism compensation of ecological Establishment mechanism compensation of ecological Establishment mechanism compensation ecological of grassland Establishment FOUR Climate Change and Poverty Reduction Policies 133 The poor population’s population’s The poor adaptability to climate change and various planned adaptation- and related policies administrative measures can reduce the poor vulnerability population’s to to climate change some extent Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Alternative livelihoods, like changes with a small scope, i.e. alternative crops, Responsive measures based upon the traditional livelihoods structure, such as livestock and poultry, or changes with a wider toscope, plantingi.e. changing and from animalfishing husbandry, employment opportunities. or developing an orchard, or going out for such as state-funded construction of irrigationand water-savingand waterirrigation conservancytechnology, or in facilitiesagriculture-animal husbandryadjusting areas, grazing time and livestock carrying capacity aid. breeding, with technological and financial by combining with stable collecting rain water, changing the farming cycle, preserving soil moisture, water- so on. saving irrigation and example, poor women in arid areas can start small businesses or engage in animal husbandry with the aid of a microfinance project; people in ethnic-minority inhabited areas where economic activities are limited can develop tourism, or producesell handicrafts; andand those in areas too harsh for living can rebuild their livelihoods in new areas through voluntary migration. Adaptation with external interventions combined with the traditional living structure, Adaptation and adjustments to alternative livelihoods via external interventions. For • • • • Fortunately, the poor population has conductedchange during the development of their livelihoods. Their experiences and capacities are many activities to adapt toboth prerequisites for climatemore aid and support for mitigating the negative effects of climate change, and key points for reducing their livelihood vulnerability. often The takes poor the populationfollowing measures to reduce livelihood vulnerability caused by climate change: 4. Adaptation to climate change: vulnerability Reducing livelihood The vulnerability of the ecological environment in the North agriculture-animal husbandry ecotones features a dry climate, shortage of water resources, loose earth, low vegetation coverage and being vulnerable to the impact activities. of Such windecotones andare mainlywater in erosionarid and semiaridand grasslandshuman in annualthe north, with precipitation of 300~450mm and aridity of 1.0~2.0, covering administrative When drought or other extreme weather events occur, livelihood vulnerability is related to the causes long hiding behind it. For example, the possibilitiesevents of such extreme as weather drought exist in the prolonged At moisture. changingthe same time, various development processactivities begin to adapt to of and reduce temperature and such possibilities. Thus, enhancing the capacity buildingthe poorof populationdaily betteractivities prepared canfor climatemake risks and more extreme events. efficient in adapting to The enhancement of the poor population’s adaptability to climate change is essentially aimed at enhancing these groups’ resilienceresponses, but to also climatelong-term adaptation.impact, This prolongednot process onlyincludes good short-termcreatingenvironment a for the locals to take appropriate action, increasing their awareness and improving the prediction of climate change, to prevent climate the risks poorfrom pushingpopulation back into poverty. Actually, adaptabilitywe ofhave poor nowpopulations seen from thecommunity autonomousand individual actions China. in ecotones in Climate Change and Poverty Reduction Policies FOUR change when facingclimate capability ofadaptation in ecotoneshascertain All thepoorpopulation 134 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy and supportedhavetofacea moredifficultsituation. aided further be cannot activities adaptive where areas the in households farming Then, sales. product for guidance and support technical in role important an plays also market the nevertheless, households; farming of vulnerability livelihood the reduces restructuring planting the case, this In 2007). Xiufen, (Wang shortages water and drought from suffer responsive of case the they when rainfall, In for waiting sit or water pump crops. to reservoir the to go farmers measures, cereal of instead crop, cash a cassava, planting by adjustments make households farmer many measures, adaptive the Under measures. of loss adaptive and the responsive to of consist due solutions reservoir. mu, Adaptation the 64 in reserved present water the to past the in mu 300 over from fallen has land irrigated of area the example, For vulnerable. more production made has change Climate encountered. ever have they difficulty biggest the farmers the by considered are and floods drought that shows Region Autonomous Zhuang Guangxi in Wuming of case The 2008). Protection, Environmental of (Ministry plants mountains and karst the animals to of peculiar and habitats endangered and ecosystem waters and ecosystem, lake forest basin, karst drainage ecosystem, karst landform karst typical the include ecotone this in Guizhou, Sichuan, of municipalities Yunnan,and Chongqing and Guangxi Zhuang Autonomous Region. Major types of ecosystemprovinces the covering China, of southwest the in areas landslides mountainous karst limestone the frequent in mainly and is ecotone This erosion mud-slides. and soil serious timber coverage, of vegetation cutting low excessive mountains, on formation, soil of process slow areas, mountainous the karst in soil thin erosion, water severe year, the through precipitation heavy from results ecotone desertification and karst Southwest the of vulnerability eco-environmental The return tothevillageforagriculturalactivitiesinbusyfarmingseasons. any They work. to planting out go farmers up when temporary is income give non-agricultural Besides, crops. to have farmers drought, severe of cases In chestnut. of instead sunflower and maize, of instead broomcorn plant to is agriculture rainwater-irrigating for measure responsive major the spring, in hits drought If irrigated. be can areas rural local in land the of part small a Only drought. to vulnerability locals’ the in resulting thus net, safety- grain local the threatens climate dry the Mongolia, Inner in that showed 2005) al., et (Brogaard Seaquist Jonathan and Brogaard Sara by conducted Studies cost. high a at is ecotone North the in government migration ecological With however basis, risks. voluntary a on climate and aid to vulnerable less are income nonagricultural of ratio most common adaptation measures taken by farmer households, and those with a higher the one of become has export service labor Spontaneous measures. adaptation these adopting on influences positive have protection) grasslands for measures and policies sustainable the promote the and as (such factors economic and social various grassland course, Of livelihoods. of on development pressure the some reduce by helps adopted grassland cooperatives of self-management the and capacity, carrying livestock reduce also collecting farmers furthermore, 2008); Yanjuan,(Wu pressing), irrigation water-saving sand and water and grinding, soil and ploughing film, plastic with (covering moisture soil preserving include adaptation for measures major Their agriculture. in best their try also farmers opportunities, job for out going to addition In households. farmer of living and production normal the affect drought, especially risks, change climate Region, Autonomous Hui Ningxia the In 2008). and Protection, land Environmental sand of and (Ministry farmland woodland sparse steppe, types desert Hebei, important steppe, The typical are Liaoning, Gansu. ecosystem and of Jilin, Region Autonomous Region, Hui Ningxia Autonomous Shaanxi, Mongolia Shanxi, Inner the including regions FOUR Climate Change and Poverty Reduction Policies 135 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage The survey conducted by Chen Jie et al. (2009)region in Maduo ofCounty Qinghaiin Sangjiangyuan Province highest the boasted County Maduo 1981, and 1979 During region. this in impoverishment indicated the deeperper capita income in China. In 1979, the total livestock impactsinventories in the county reached of climateup to 676,700, as with a per However, result capita of of the 115.1. drought changein the 1980s, on not was there thus and reduced, capacity carrying livestock and degraded grasslands the enough feed for livestock. In 2004, the total amount of herbivorous livestock inventories reduced to 238,600, declining by 64.7% compared with that in 1979, while the per capita amount reduced to 19, declining by 83.5%. Morebecame eco-refugees comprising every 26.9% winter, of all thanherdsman households. More 630 households of herdsmen than 2,800 small lakes have dried up, with field areas shrinking conservancy of water sources became weaker. year by year, and the The Qinghai-Tibet Plateau complex erosion ecotones mountainare mainlyvalleys in thein arctic-alpinethe middle reachesPlateau and ofSanjiangyuan regionthe (the Yalu source Tsangporegion of River,the Yantze, the theYellow and the NorthLancang TibetRivers) in Qinghai Province. Eco-environmental vulnerability is manifested arctic-alpine terrain, harsh natural conditions, sparse vegetation and multiple phenomena in of soil erosion including wind, water and freezingProtection, 2008). erosion (Ministry of Environmental Studies conducted by Hui Xue (2006) on risks forYunnan farmingProvince householdsshowed that in in Zhongdian,assessments of covariant risks, living farmingon rivershouseholds thought floods the most serious, followed by mistythose rain living and in hail,highland whilst areas considered snowstorms and the death of livestock As more for serious. measures to to reduce the above-mentioned risks, be the studies showed that rich farming households could depend on on loans,aid fromwhilst neighbors the and poorthe couldgovernment. onlyNonetheless, rely both when ofcovariate natural them risks werehappened, andaffected it was hard for poor households to rely on aid from their neighbors under such circumstances, so they had to no sell other assets, choice mainly thanlivestock. However, there were still 40% of poor households couldthat only rely on neighbors’ aid during when the covariatemost risksdifficult such time.as naturalGenerally disasters speaking, aid,happened, the in assistanceaddition to fundsgovernment set up bycollective communitiesconstruction of dams, alsopreviously, played a goingrole in mitigatingout the to negativerisks. Accordingwork effects to of their and experience and expectations, farming households thought that of all the risk-reducing strategies, a community safety net was the educationmost effective, for and children was an effective long-term strategy. Access agricultural to and trainingfarming technologies, forjoint decision-makingnew and increasing the number of grazing herds were considered to be effective long-term strategies that could enhance risk-resisting capacity. Farming households also considered in the sort-run. be effective income and strengthened family ties would that diversified forms of The Southwest mountainous agriculture-animal husbandry ecotones are mainly Basin, covering over to the Sichuan Plateau in Qinghai-Tibet Mountains from the Hengduan the 40 counties and municipalities such Aba and Tibetan Autonomous as Qiang Prefectures, Ganzi Tibetan Autonomous Prefecture and LiangshanSichuan Province, Diqing Yi Tibetan Autonomous AutonomousPrefecture, Lijiang city and PrefectureNujiang Lisu in Autonomous Prefecture in Yunnan Province and LiupanshuiGuizhou Province. Eco-environmental cityvulnerability takes in the theform of northwestundulating terrain, of complex geological structures, remarkable vertical hydrothermal changes, undeveloped soil, infertile soil and thin vegetation, being strongly by affected human activities and with Protection, 2008). (Ministry of Environmental notable regional eco-degradation Climate Change and Poverty Reduction Policies FOUR 136 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy as hiredherdsmen,orconductotherproductiveactivities. herds graze to out adaptive go and pasture The their leave to was herdsmen pastureland. some by taken measure the in population total the of 31.9% for accounting people, were there poor 3,219 and 2004, total, the In of 35.82% comprising County,worse. Maduo in households herdsmen poor 839 by suffered poverty the made and husbandry source the in animal of production the lived affected seriously degradation they Grassland rivers. three of though region of even short drinking, were for water County no Maduo with in water, and people the electricity that so up, dried had River Yellow the of source the at Lake Eling and Lake Zhaling between section 1990’s,the the of end the By goal. First of all, they should be aware of the possibility and time of climate change risks, change climate of time and possibility the of aware be should they all, of First goal. be may that this achieve to information groups relevant or capacities the possess to prevention have risks such However, by affected vulnerability. corresponding livelihood and reduce risk help will change measures climate forecasting and Understanding was restoredandsoilerosion controlled(GeJianxiong,1997). vegetation natural that so wild, left was or pasture became farmland cultivated previously the where reaches, middle the in land-use of mode the in changes from came AD) 220 (25- Dynasty Han Eastern the Yellowin the River in water of passage safe the example, For disasters. reduced measures adaptive proactive people’s time, same the At areas. these in down settle could people and (475-221BC), Period WarringStates the of middle the in dams of construction large-scale the after fixed were YellowRiver the of reaches lays a foundation for the people’s staple life and well-being. The river courses in the lower the make Rivers Yangtze the and facilities conservancy water of Construction floods. to vulnerable more areas surrounding Yellow the along sustainable features and natural stability The economic and livelihoods. social for vital is planned measures both of autonomous features and have that processes adaptive that shows change history climate Chinese by in caused Migration disasters. natural particularly change, climate by of efforts joint the of caused conditions production and results living in changes the the and factors economic and been social have history Chinese in mode production and patterns production agricultural in changes and to adjustments and migration Constant conducting and data unpredictability canbetransformedintopredictability. relevant collecting by reduced necessary experiments. Experiences in water resources management in China show that be natural can by disease, off or cut hurricanes unpredictability is drought, to such vulnerable communities more poor areas the of in increasing However, by disasters. development greater is the caused There when species. exotic disasters to due unpredictability ecosystems biological of change the frequent and as temperature such change, climate of unpredictability affectedthe be by can organizations and communities of adaptability The reduced, duetothelackofvariousresources. be cannot risks change climate by caused vulnerability the way,i.e. effective an in risks • to takeadaptiveactions. Not• all the people are aware of climate change risks, so that they may lose opportunities a still considerable numberofproblems: are there However, change. climate by caused risks resisting and to adapting of process prolonged the during experiences many accumulated has population poor The assistance external Corresponding change: climate to Adaptation 5. Even though they may be aware of climate change risks, they may not counter these counter not may they risks, change climate of aware be may they though Even FOUR Climate Change and Poverty Reduction Policies 137 In the process of enhancing the adaptability to climate change, it is vital for external assistance to transform the unpredictable into the predictable External assistance can help poor population work out pre-disaster aid programs coastal water-land transition areas Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Box 13: Limits of the capacity of mitigating climate risks by a village in the Box 13: Limits of the capacity of mitigating After planting white poplars as part of the agricultural restructuring effort to mitigate climate risks such as rainstorms, the villageinsect hasplagues to andface hurricanes.new problems, What suchmakes asyoung the men havesituation gone to work worsein neighboring is towns that,and cities, asleaving behind mostonly less the able elderly, laborers and children, who are unable to deal with emergencies without assistance from able youth. Inresponsibility in disaster addition,management, for example, they do not organize organizationsvillagers to do not fulfillmaintain drainage ditches. Therefore, it theiris vital to strengthen village-level institutional development, so as to encourage local community self-management organizations, farmer’s cooperatives, women’s societies risks. participate in the management of disaster and the Communist Youth League to External assistance from government institutions, non-governmental other social organizationsservice organizations are orall vital for the poor population to counter climate change risks. Government and assistance before the organizationsfloods hit India and hadBangladesh in 2000.worked These organizations drewout maps of programs Farming households hope to gain external assistance to improve their own adaptability. The studies in Ningxia Hui Autonomous Region showed that farming households in the northern irrigated area hoped that the government could provide substantial support for the for transfer”, “cash and materials” agricultural of “input construction”, capital “farmland locals engaged in agriculture and animal husbandry, thereby enabling them to develop businesses as alternative livelihoods. Though the farmers in the middle arid expressed their area hopes for the also above-mentioned assistance, what they needed most was a direct “cash payment” from the government, since quite a proportion of local agriculture has been seriously affected by drought and could not manybe solved farmersby farmland capital construction thoughtor increases in input thatof agricultural the problem materials, and that cash subsidies would be more effective. Similar to the situation in the middle area, the farmers in the southern mountainous area relied more on cash payment 2008). Yanjuan, and input of agricultural materials (Wu and then take various measures in immediate response and long-term adaptation, as well well as adaptation, long-term and response immediate in measures various take then and as provide conditions for these measures. Unfortunately, the poor population is short of these necessary capacities and conditions. It was the poorest and least-educated people who were not made adequately aware of theKatrina hit in government2005. Education for the most warnings vulnerable groups will improve whentheir capacity Hurricane to respond. education Moreover, is quite important for these people, in relation to issues of For equality. instance, education for girls is a major way to get rid of intergenerational poverty. Besides, education is closely related to healthier children and familiessustainable and environmentto management (Human Vulnerability and Environment,Similar 2009). cases in China also indicate that theidentifying poor risks,needs namely, tothe enhancevulnerability its caused capacityby climatefor better changeuse of risks,various resources and to makeeffectively coordinate all stakeholders for prevention and responses. In addition, other capacities for mitigating climate change risks also need to be enhanced for individuals and communities, so that they can make use of existing human and material resources to adapt and deal with risks in a more effective manner (Box 13). Climate Change and Poverty Reduction Policies FOUR capacity enhancing thereserve adaptation toclimateby the autonomous assistance canimprove livelihoods fromexternal The alternative the livelihoodsafety technologies toensure traditional andmodern measures thatcombine communities takethe help poorpopulationand External assistancecan 138 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy Table 7.Developmentactivitiesconductedbythefarmerhouseholdsduringsheepbreedinginthreevillages machines provided Feed processing pasture amount carryingin Reduction oflivestock of pen-raisedsheep to increasetheamount Sheep shedsbuilding and fencing Grassland contracted of qualityherbage planting andreseeding Grass andtrees Development activities and ofwarmsheds. grasslands, on fences of construction the in million RMB20 than more invested County Yanchiof government the 2006, and 2005 In activities. such in role important an played when drought affected thegrowth of grass ortheyield of maize. In addition, governments risks counter to reserves sufficient had they change: climate to adaptation autonomous farmers’ the reflected by breeding sheep out from mainly carried income earning households activities farming development that showed 7) (Table Region Autonomous Hui Ningxia in villages three in survey The cash. of form the in is assistance external Some The importance of external assistance can be also seen in the case of pasture pasture of case the in seen also be (Dougherty can Sudan of Republic the in maintenance assistance livelihood and restoration external of importance The and assetshelpedestablishaself-responserecoverysystem(GOWB,2005). and sanitary facilities, and organized site maneuvers. By so doing, they saved the locals’ lives children, and women necessities, daily facilities, disabled, first-aid prepared floods, of the forecast gave sick, the elderly, especially the to relation in groups/population vulnerable local of situation the considered households, local of number the estimated areas, highly-vulnerable and low-risk safe, identify villagers helped vulnerability, village launched by individuals, government and relevant institutions, and adopted economic economic adopted incentive mechanism( and institutions, jointly relevant and projects government cooperative individuals, by in launched invested systems, drainage from established aid funds, added private reservoirs, built systems, monitoring improved reforested, policies, to adjustments made dykes, flood constructed governments local some floods, of impacts the Tomitigate livelihood. their ensuring products, forest basic with livestock and locals the provided and fences, as such systems management traditional adopting by woodland of by hectares 30,000 about restored herdsmen livelihood TurkishThe caused needs. their major met and with products famine them the provided after ecosystems woodland Kenya since of 1960, in north drought the the in action ecosystems take to woodland began herdsmen restore Turkish to 2004), al., community et (IISD and report joint a in restoration indicated as pasture and restoration, pasture for measures training, above-described the to Similar included development. livelihoods sustainable actions for various The through communities. in pasture, resources natural basic highly-vulnerable for and technology managing over-exploited the organizations restore aid locals 2000 and the 1992 helped early between drought, local the mitigate to 2001): of sheepbreeding remarkably reducethecost land, toincreasestalksand Planting maizeinirrigated Vegetation restoration experience inbreeding sheep breedingandobtain Increases inincomefrom achieve betterresult managed byhouseholdto Contracted toand and sandfixation Protection againstwind Advantages Vari et al., 2003; Manuta et al., 2001 al., et Manuta 2003; al., et Vari Yanchi County funds Shortage of affected livelihoods Farmers’ funds technology and Lack of needed Big investment Disadvantages other projects Aids fromgovernmentand pen breeding and subsidiestrainingfor Free governmentinvestment subsidies Large amountofgovernment grassland stations of animalhusbandryand county-level administrations Quality seedsprovidedbythe ). Opportunities risks Low risks Low risk No risk No risks No et al., al., et Risks FOUR Climate Change and Poverty Reduction Policies 139 External assistance shall be based upon locals’ initiative and knowledge Services of engineering of engineering Services and technology information-based also help forecast enhance adaptability ). In Hungary, ; quoted from a ). et al., 2005 et al., 2003 2005

; UNDP et al., et al., 2000 ; Pirot 2004; Jesse Manuta 2004; Jesse Manuta ). It was proved to be both feasible and beneficial for the local et al., et al., 2000 ; quoted from a secondary source, Wu Yanjuan, 2008) showed 2004

Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage et al., et al., 2003 Release of and access to forecast informationadaptability. Studiesis ofcarried equalout importancetaken by inGina enhancing Ziervogel Ziervogel and Rebecca Calder (Gina Adaptive measures are diverse. Various economic activities play reducing an vulnerabilityimportant caused roleby climate in change risks. Cooperation during the process of adaptation is also vital. There was almost no rainfall in B Village in Xilingol League of Inner Mongolia Autonomous Region in the spring of 2006, and most herdsmen adopted “aoteer”, i.e. a way of grazing in various pastures, to prevent herdsherdsman from dying.households Some became friends and established years, B Village also reciprocalreceived herdsman households in the way of “aoteer” (Li Wenjun et relations. In some al., 2009). In a region of India, farmers deal with drought with a series of strict measures of drainage reconstruction, including managementmanagement, afforestation,of rural soil,energy management,land animal andhusbandry management moisture, crops and community organizations such as “rural self-aid organization”, to reduce vulnerability to drought and to strengthen, enrich and(Watershed Organization Trust). guaranteeIn a case thestudy on livelihoodsMexico, Hallie Eakin (Eakin, of 2005) varieties choosing localby income nonagricultural increasing for measures adopting suggested farmers of crops. Some studies show that agricultural eco-measures can resist typhoons, mainly by conserving water and soil, using organic fertilizer, improving diseases and managementinsect pests, and changing of modes of plantgrazing (reduction in grazing or zero grazing) etc. A typical case is in some areas of Vietnam, where local residents mitigate the impact of typhoons by restoring the mangrove and ecosystemthis alonghas theenhanced coastal the line, local capacity of natural protection and consolidated the quotation by Wu Yanjuan, 2008). Yanjuan, quotation by Wu External assistance can often enhance the locals’ adaptability by providing support For example, floods arefor themost frequent and damaging natural engineering technology. disaster in Asia. Flood control gets more complex due to climate change. Jesse Manuta thinks that it is necessary to control floods and mitigate the impacts withand technological engineering measures. Take the type of aquifer management adoptedflood controlin Iranfor for example. Traditional technologies were adopted distributeto collect, storewater and resources, enriching caused by floods (IUCN livelihood diversity and reducing vulnerability many people who are repeatedly affecteddiverse by activities,floods trysuch to as earnplanting theirprimary plum living products and through (jamwalnut manufacturing), on floodedfamily plains,handicraftsand embroidery), or taking processing(traditionalflooded plains as pasture carpet(Vari weaving Locals’ initiative and knowledge also play an important role in the process of autonomous initiative and knowledge also play an important role in the process of Locals’ adaptation. When the Senegal River flooded, relevant agencies organized local people to take a series of actions to protect the local wetland ecosystem and to resist the floods (Hamerlynck that farmers in South Africa devote considerable time to assessing weather information, deciding accordingly when to sow seeds, what crops or vegetables to plant, when to sell livestock and raw materials, how to manage water and soil, whether to let children go to school and which market should be chosen. For instance, they will choose a drought- resistant variety of maize or a variety with a shorter precipitation, according to forecasts. rainfall is around 40 % less than normal growing period, or use fences, if residents to take part in the management of wetland protection.could control the Ecologicalflood and restoremeasures the structure and functions of the severely-damaged wetland ecosystem. These measures were alsolivelihoods (Sherbinin beneficial for biodiversity and local Climate Change and Poverty Reduction Policies FOUR markets communities and concerns governments, external interventions mechanism of The alleviation 140 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy quoted fromasecondarysourceofWu Yanjuan, 2008). 1998; (Hidellage, safety grain guarantee to business, goods petty from income earn and seasons farming slack in drought villages their When outside work for conditions. leave Lanka living Sri in farmers future hits, farmer their for of measure stability the responsive strengthen to effective an households become has other to migration Mexico, migrated of have case youth, capable especially countries for a better life (Hamerlynck et al., 1999b). Furthermore, in the above-described people, many so land, most on resources natural of loss cause floods Senegal, In option. adaptive another is Migration secondary a from quoted 2005; (Eakin, source, Wu Yanjuan, 2008). husbandry. animal developing and income nonagricultural increasing varieties, of crop loss changing the through for crops compensate rainwater-dependent farmers frequently, occurs frost where Mexico in areas In 2000). Neighbors, World 2001; (IFRC, livelihoods residents’ for resources of foundation external interventions(Fig.13). via alleviation through promoted is adaptation where framework a report its in proposed Development and Change Climate on Commission the others, and upon Agrawal Based cooperation forfarmerhouseholdsduringadaptationtoclimatechange. and organization of development capacity the for mechanisms long-term and livelihoods alternative for aid budgetary mechanisms, compensation ecological including here, role important an play can policies their supporting national improve effective to and Long-term population adaptability. poor the for vital are relations social of establishment and extension the and opportunities economic Ever-increasing 2007). (Mahoney, important for poor farming households, actions that can help farmers gain long-term assets become accumulation asset promoting of in perspective and the From risks 2009). (Kingyangi, change sustainability livelihood climate ones by caused responsive vulnerability short-term than livelihood better reducing in are measures adaptive long-term reality, In PA framework in risks change climate Including experiences: Foreign 6. Fig. 13: The alleviationmechanism ofexternalinterventionstopromotetheadaptation Source: Ian Christoplos et al. (2009). al. et Christoplos Ian Source: climate change FOUR Climate Change and Poverty Reduction Policies 141 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Supported by DEFRA (UK Departmentand DFID (UK ofDepartment Environment, for International Development),Food,Agricultural andthe ChineseSciences,Rural Academy Affairs)Ningxiaof MunicipalCommission, Commission Ningxia Meteorologicalof Development Bureau andand thedrawn Reformup Universitya framework for adaptation of for Ningxia EastHui Autonomous AngliaRegion, as shown have in Fig. 14. In the framework, there are six steps for adaptive strategies: assessing climate risks within the framework for adaptation adaptive (risksobjectives; identifyingin adaptivethe measurescoming and technologies;20 years);ranking priorities identifyingfor adaptive measures and forecasting possible problems in implementation; monitoring, evaluation and capacity buildingactivities after adjustments. in implementation; and a new round of adaptive A forestation and re-forestation A project on degraded land in northwest Sichuan is the first forest carbon marketing project in China based on climate, community and bio-diversity (CCB). After five years’ preparation and authentication, the project 26thwas completedNovember on 2009. The owner of the projectit soldis 460000Daduhe Afforestationtons of itsBureau carbon and emission at quotaa price no lower than US$5 Company, per ton, and the income exceed US$2.3 million. to the Hongkong Low-carbon Asian This project will build up 2251.8 hectare artificial forest on degraded land in 28 villages of 21 townships in five counties of Li Xian, Mao Xian, Bei Chuan, Qing Chuan and Ping Wu. With regard to the than US$2.3 million income from the carbon emission quota, the official responsible in the Bureau claimed thatit will be shared with 12745 farmers in five counties on a ratio basis, and the farmers in the project implementation district will obtain 2009). Yanshu, a stable income for 20 years (Hu Women in Guatemala, Nicaragua, El Salvador andmaya trees Honduras in the four havecountries since planted2001. With grain 400,000safety guaranteed, women and their families can also benefit from aid funds for climate change, such as the “Balanced Funds” initiated by the US and Europe in pursuit (World of Bank,carbon 2010).credit Calculatingtrade opportunitiesthe contribution of tree changeplanting impact to and mitigatingsetting up climate corresponding incentive mechanisms can actually forwardcarry such actions. In the meantime, such behavior can be mechanisms. facilitated by marketing This framework concerns all themarkets. relevant The frameworkparties: showsgovernments, thatproduction, thecommunities marketso that providesandthe poor variouspopulation foropportunities can their increaseadaptability throughwealth,for product healthsales and andsmall knowledgebusiness the activitiesmarket. conductedEcosystem in services determine the natural capital population, and they possessedare also All an the important parties part can of provide adaptability. by the poor adaptive groups with support via information and advice, finance,technology, leadership and laws through structured and interactive mechanisms. Such externalpromote interventionsresource mobility, capital storage, diversification can be enhanced. so that communal and individual adaptability communal pooling, of livelihood activities and Climate Change and Poverty Reduction Policies FOUR China Hui Autonomous Region, implemented inNingxia been startedupand to climatechangehas Framework for adaptation 142 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy the aspects of support and time limit, since adaptability building aided by social transfer social by aided in building adaptability since required limit, time is and support security of aspects the specific all, of First features: following the has transfer transfers. social Asocial the through if enhanced is visible, change be climate can to adaptability of reduction population’s and poverty poor of operational result is The and advantage. scope wider comparative a on higher influences has project transfer social A enhance the poorpopulation’s adaptabilitytoclimatechange. helping for capacity potential higher a have projects transfer social managed in state- channels, adaptive other the with compared mechanisms that show Ethiopia and Brazil Mexico, transfer social of assessment the Nevertheless, risks. face they when families and individuals by demanded security the overlooked have plans top-to-bottom and risks, climate cover not do resource areas many in transfers However, social population. poor to access the targeting equal donations preset regular promote the to to referred are transfers aiming Social opportunities. policies in them effective an include as and transfers social measure consider organizations and countries more and More technological support,specificactivitiesandcapacitybuilding. coordination, to relation in institutions, chosen the all for activities various in participating of ways determine and institutions, relevant identify will framework analysis the activities, adaptability high adaptive the determining them. very After for support provide and not aid, external of need in but and scores high with activities the choose will it Afterwards, The analysis framework will also evaluate the autonomous adaptability of these activities. activities alleviation poverty and (including returningfarmlandtograsslandsandecologicalmigration). reservoirs) and cellars water-storing of construction and irrigation water-pumping technology, water-reserving film-covering technology seeds, resistant water-saving drought- crops), of cultivation (including new infrastructure water-saving of of construction the and introduction and restructuring farming into (subdivided restructuring agricultural of effects intended the evaluates and objectives, its analysis as The disasters to responses and protection subsequently. ecological alleviation, poverty takes framework developed is activities adaptive choosing and identifying for framework analysis an and southern, assessment risk into a following divided parts, is northern and eastern Region Autonomous Hui Ningxia the framework, this Within Fig. 14:FrameworkforadaptationtoclimatechangeinNingxiaHui Autonomous Region Source: Declan Conway (2008). Conway Declan Source: FOUR Climate Change and Poverty Reduction Policies 143 Source: ILO/STEP-GTZ (2006) Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Fig. 15: Microinsurance: risk management and social protection mechanism risk management and social protection Fig. 15: Microinsurance: Micro-insurance services already launched in China are relevant aimingfor devisingto policiescounter climate change risks vulnerability.and The reduceChina theInsurance poorRegulatory population’s Commission haslivelihood launched agricultural A A research report by thesignificance of risk management and social protection mechanismsInternational in poverty alleviation Labor strategies, Organizationand points out that micro-insurance can (2006)be effective as a indicatesforspecific measure risk managementthe and improvingorganizations relevant to micro-insurance are diversified public organizations. They need social protection mechanism. directInstitutions functional departments and (health service department in theassociations, federations, report),non-governmental organizations cooperatives,and microfinance institutions to support their system setting and operation, and to provide insurance service to their members, and they also may cooperate with publicThese mechanisms can or cover various privaterisks in fieldsinsurance such as health, property, maternity, companies. life, crops and so on,mechanism; andexcluding haveat least somesome beneficiaries, features for departments example,and their families, workersinfrom the in formal common:social unofficialprotection mechanism; non- adoptingcompulsory insurancemembership; fees partly paid by members; different andfrom that providingoffered by socialofficial departments.security Micro-insurance mechanisms should be based upon risk analysis and the priority demands of targeted groups. Furthermore, issues such as whether micro-insurance has comparative advantages compared with the other measures, whether it can be linked with the other mechanisms and how it can be integrated into social protection mechanism will be analyzed. needs long-term and pre-fixable funds. The awareness of the poor to population’sclimate rights adaptation can help intensify policies. Secondly, policies fordivisions socialfor wider transfer, services and plans for climate adaptation should be consistent, and then government coordination between divisions of and agriculture health,is capital important. aid Thirdly, from social transfers will education,go together with social welfare institutional capacity building, and technological change is essential. (Christoplos et al., 2009). Climate Change and Poverty Reduction Policies FOUR 144 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy jointly published by the China Insurance Regulatory Commission and the China Banking of China the and Commission Regulatory Insurance China the by Opinions published jointly Insurance The Agricultural and areas”. Loans rural Agricultural between in Cooperation the micro-insurance Strengthening “develop to aim the states insurance five clearly the document” with central 1 “No. (PICC) 2010 The insurance. China agricultural of in specializing organizations Company companies Insurance insurance People’s national the of as such consisting established, network been service has national insurance the property combining micro system rural service and a years, insurance recent In agricultural for and regions. 2008 in autonomous and regions provinces autonomous 19 to and spread provinces 9 in promoted been has insurance Micro- 2004. since Region Autonomous Uygur Xinjiang and Province Heilongjiang agricultural including regions) autonomous and (municipalities provinces 5 launched in projects pilot insurance livelihood has Commission population’s Regulatory poor Insurance the China reduce The and vulnerability. risks change climate counter policies to devising for aiming relevant are China in launched already services Micro-insurance integrated intosocialprotectionmechanismwillbeanalyzed. be can it how and mechanisms other the with linked be can it whether measures, other the with compared advantages comparative has micro-insurance whether as such issues Furthermore, groups. targeted of demands priority the and analysis risk upon based be should mechanisms Micro-insurance security departments. official social by offered providing that from and different members; by paid partly fees membership; insurance compulsory adopting non- mechanism; protection unofficial social common: formal in the from in workers families, their and example, departments for features beneficiaries, some some least at have excluding and mechanism; on, so and crops life, companies. maternity, property, health, as such insurance fields in risks private various cover or can mechanisms These public with cooperate may also they and members, their to service insurance provide to and operation, and setting system their support to institutions microfinance and cooperatives, organizations non-governmental report), federations, associations, the in department service (health and departments functional Institutions direct mechanism. protection social need They organizations. public diversified are micro-insurance to relevant organizations improving and the management risk measure specific for indicates a as effective be (2006) can micro-insurance that out points and Organization strategies, Labor alleviation poverty in International mechanisms protection social and management risk of significance the by report research A the take services Microfinance purchase ofagriculturalinsuranceasacreditfactor. loans. farmers for by application held the for value collateral cash as with used be policies can that means This insurance. agricultural for mortgage policy be of varieties the increase and should scope the expand to industry banking penetration the in institutions financial insurance requested and that loans, agricultural of policy providers of among increased angle the Regulatory from Banking China stated the and Commission Commission Regulatory Insurance China the by published jointly Insurance Agricultural and Loans Agricultural between Cooperation the insurance five states theaimto “develop micro-insuranceinruralareas”. The OpinionsofStrengthening the with clearly Document” 1 (PICC) “No. 2010 The China insurance. agricultural of in specializing organizations Company companies Insurance insurance People’s national the of as such consisting established, network been service has national insurance the property combining micro system rural service and a years, insurance recent In agricultural for and regions. 2008 in autonomous and regions provinces autonomous 19 to and spread provinces 9 in promoted been has insurance Micro- 2004. since Region Autonomous Uygur Xinjiang and Province Heilongjiang including regions) autonomous and (municipalities provinces 5 in projects pilot insurance FOUR Climate Change and Poverty Reduction Policies 145 Analysis and evaluation of climate change be included in poverty alleviation programme Poverty alleviation Poverty alleviation be strategies should risks sensitive to climate emission be reduced by 40~45% in 2020 compared with that in 2005. It is a 2 and evaluation of climate change risks should be an important part of 74 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage mandatory indicator being listed in mid and long-term national economic and social development plan. mandatory indicator being listed in mid and long-term national economic and social development China has set objectives on carbon emission reduction that CO poverty alleviation programs. Analysis and evaluation shall be made within the scope of ecotones, and indeces such as changes in rainfall and frequency of drought and floods 74 Firstly, Firstly, analysis 7.2 Medium-term policies framework climate change in a PA and programs: Adaptive policies for The enhancement of local residents’ combined with the communal and adaptabilitycultural development of ethnic minority communities in to climate change riskecotones where ethnic shouldminorities are concentrated, such as beSichuan, Guizhou, Yunnan, Chongqing and Guangxi in the Southwest karst andcounties desertification and municipalitiesecotone, oversuch 40 as Aba Tibetan and GanziQiang AutonomousTibetan AutonomousPrefecture, Prefecture and LiangshanSichuan Province, Diqing Yi Tibetan Autonomous AutonomousPrefecture, Lijiang city and PrefectureNujiang Lisu in Autonomous Prefecture in Yunnan Province and LiupanshuiGuizhou Province in the Southwest citymountainous agriculture-animal husbandry inecotone, the northwest of and the Tibet Autonomous Region and Qinghai Province in the Qinghai-Tibetcomplex erosion ecotone. Plateau Specialized poverty alleviation measures and financial budgets, as well as specialized ecotones. transfer payments will be established for The contribution of the poor population(via nature to reserves/areasmitigating prohibiting the exploitation,impact projects, grasslandof afforestation and climatere-forestation projects, ecologicalfood security projects, changeconstructionand bio-energy projects etc.) must be fully compensated. Compensation should be combined with implementationthe of development strategies for the livelihoods of the poor population, to ensure that compensatory measures can promote their asset accumulation and secure sustainable livelihoods. Poverty alleviation strategies should be sensitive alleviationto strategiesclimate should risk.give full Systematicattention to povertythe threats of climate change the risks poorto population, and reduce the livelihood vulnerability direction, contents and modes. ecotones, through working out strategic of the poor population in Egalitarian principles should pervade the entire andprocesses mitigation of bothand adaptationpoverty reductionto climate change.adaptation In to the climateprocesses change, ofsuch mitigationas carbon andmarketing, carbonand taxationtax utilization,acquisition, focus should be placed on time, equal poverty accessalleviation strategiesto benefits.taking into At considerationthe climate same risks is a to obtain equal access to benefits. approach for enabling poor farming households concrete 7.1 Long-term PA strategies: Reducing climate change risks strategies: Reducing climate 7.1 Long-term PA 7. Suggestions Regulatory Regulatory Commission stated from the angle of policy that insurance penetration should be increased among providers of agricultural loans, and requested financial institutions in the banking industry to expand the scope and increase the varieties of policy mortgage for agricultural insurance. This means that canpolicies be used with as cashcollateral valuefor the heldapplication by for farmersloans. insurance as a credit factor. purchase of agricultural Microfinance services take the Climate Change and Poverty Reduction Policies FOUR 75 risks against climatechange insurance mechanism Establishing micro- climate changerisks Setting upfundsfor in ecotones measure of work for relief More attentiontothe adaptation earmarked fundsfor mechanism with Social protection 146 wider range.Itcan beoperatedonthebasisof currentpracticeofmicroinsurance. a covers and happening from relief post-disaster pure of uncertainties prevent can mechanism The shocks. idiosyncratic into transforming Microinsurance mechanism relies on mutual trust and cooperation between communities, to reduce the chance of covariate shocks covariate of chance the reduce to communities, between cooperation and trust mutual on relies mechanism Microinsurance Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy aid funds for adaptation to climate change in poverty alleviation”, looking for activities activities for looking suitable forreplication,disseminationandimplementation. alleviation”, poverty in change climate to ecotones, adaptation for funds aid different in developed be stakeholders. These activities should be combined with capacity building and “specialized should multiple- of involvement the with pilots livelihoods for designed activities alternative and representative select Lastly, sustainable livelihoods. of development the in assist to environment business capacity local the the and improve to services, capital and technology of capacity information, as such leadership, resulting capacities enhance changes to of attempt risks should building the of Capacity change. aware climate fully from more be should we implementation the policies, During various risk. of to responding of capable are they that so natural of resources, management effective the in participation their and social mechanisms, and protection services various to access local population’s at poor the structure ensuring levels, management state a and establish to needed, are inputs relevant shocks. Therefore, covariate of impact the to due position, weakened a local in previously, often are analyzed governments As necessary. is building capacity conditions, these Under the preserveofmenremainingbehindinvillage. those communities where most men leave for off-farm work, yet decision-making remains in particularly needs, women’s on focus to important is It evaluations). participatory via and Sciences Agricultural of Academy Chinese the of be results can research the evaluation upon The based population. poor the for risks change climate activities reduce to adaptive aiming evaluate to institutions relevant organizing through realized be can information, support (this disasters natural market to resistance and of, prevention the for livelihoods, required support other and support, network alternative and technological by workers, migrant by required required information funds and restructuring, production technologies for required support technological the The include alleviation”. will poverty measures in change climate to adaptation for funds aid budgets in “specialized included as and quantified measures adaptive by required support measures, policy and adaptive into transformed be should measures protection social Secondly, included intheexistingdatasystem,providingbasicsupportforriskassessment. Thirdly, micro-insurance mechanisms micro-insurance Thirdly, managed eitherbypovertyalleviationofficesor alleviationfoundations. when be can aid Funds disasters. and natural especially change, material climate of challenges relevant the with obtain faced can they that so to risk, population change poor the climate of to ability adapt the improving for aid provide can funds Such losses. reduce and disasters natural to respond to mechanisms), transfer social through funds raise (or risk” change climate for “funds up set should Finance of Ministry Secondly,the be combinedwithmigrationorothermeasures. attention should this and More measures, such of implementation the during ecotones to paid be should change. climate to adaptability population’s poor the improve help can construction infrastructure since important, still is work relief for labor of use the Firstly, 7.3 Immediatepoliciesandmeasures of Environmental Protection), so that farming households can be compensated at the the at compensated be can households farming that so Protection), Environmental of Ministry of program protection the in listed areas protection key 19 the in (or risk change 75 can be established in areas with higher climate climate higher with areas in established be can FOUR Climate Change and Poverty Reduction Policies 147 Integrating adaptation to climate change into the development program . . Furthermore, with 76 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Establishment of prepaid funds: Regular prepaid funds will be set up in areas Risk sharing: Compensation from prepaid funds for people affected by risks; no Administrative structure: Micro-insurance mechanisms will be included in existing withdrawal of the prepaid amount allowed for unaffected people. amount allowed for unaffected withdrawal of the prepaid poverty alleviation operations. aid Currentfunds andcommunal microfinance development can be experiences funds/mutualcombined with withmicro-insurance. agricultural Basedalleviation funds can be onused micro-insurancein the form of premium subsidies in some areas, some poverty support from current policies, micro-insurance policies can be in applications used for small as loans, collateraland managed together with mutual aid funds. Such an administrative structure can be tested in communitiescooperation and betweenmarket, to governments,reduce climate-based poverty. Current organizations for implementation and monitoring poverty related policies,organizations, farmers’ cooperative and long-term pilot sites experimenting with micro-insurance schemes. of research institutes are all bases for sensitive to climate change risks before these risks occur. Mostfrom of budgetarythe fundssources are and included in “specialized areas. a small part is paid by people in key protection climate change”, and aid funds for adaptation to • • • • In accordance with the requirements of accelerating pilot projects of agricultural insurance by the state and Shandong Province, Ji’nan municipality worked out Agricultural 2010 Insurance Implementation in Plan Ji’nan. for In Pilot 2010, Projects the of pilot projects concerning planting are launched in Pingyin County, Shanghe County householdsand inChangqing these District,pilot countiesand Pingyin(districts) Countyare organizedfor animalCompany. 80% in of theinsurance husbandry. premiums unitfor Farmerwheat, of maize and villagecotton are to subsidized by buy government insurance.finance, the otherThe Pingyin and District 20%Changqing in subsidies insurance agricultural The premiums. the paidof 60% pay insurerfinance provincial and Central households. by farmer in Ji’nan is PICC Ji’nan County are shared between the municipal and county (district) finance, And with the 10% agricultural each. insurance subsidies in Shanghe County are shared by the municipal and county finance, with 15% and 5% respectively 76 The operation of micro-insurance mechanisms should include: The operation of micro-insurance maximum maximum level for their asset losses when climate change risks hit, and prevented from sliding back into poverty or suffering from aggravated poverty (as with risk funds, micro- insurance mechanisms have different criteria for various insurance types, and we need to determine and evaluate insurance types, probably testing ‘weather-index’ insurance poor areas). mechanisms in some “Enhancing awareness of and adaptability throughout the whole process, and will be assisted by the provision of cash transfers. to climate change risks” is a key issue Fourthly, Fourthly, improvements in the ability to adapt to climate change risks can be integrated with the implementation and monitoring and evaluation of poverty alleviation programs. As with the participatoryidiosyncratic village-levelshocks (diseases, incidents etc.) and covariatedevelopment shocks (failure of due harvest program,to drought peopleand floods) affected will solutions be by treatedand suggestionsas a for separaterelevant group,activities.will be andgiven Various special attention providedgroups,in relation to especiallytheir withparticipation in the women,process. Monitoring and evaluation systems will include dynamic evaluations of correspondingclimate change adaptabilityrisks and (at regional- and communal-levels),of specialized utilizationaid funds for and adaptation effectsto climate change (at regional-level), adaptation and climate-change managing capacity-building for effects staff of atfunds allfor levels,climate changeutilization risk and(at communal-implementation of micro-insurance (at communal- and individual-levels). and individual-levels) and the Climate Change and Poverty Reduction Policies FOUR 148 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy of programs and projects, to provide assistance for the final approval of projects and and projects of approval final decision-making. the for effectiveness assistance and provide to rationality projects, the and assess programs to of evaluation of index important change an climate as take will risks we projects, designing or programs these out working When impacts canbespecified. negative minimizing for the society international analysis, and Government this China’s of of responsibilities basis the On poverty. influence then and structures, employment and be utilization resources can production, Analyses influence can pathway. activities coping impacts how its of on undertaken analysis with China, in climate poverty with on coping change of impact the on research continued be should there during Additionally, experiences foreign from learn also can we implementation. time, same the At practice. in and feasibility of these suggestions will still require further studies and timely adjustments applicability the implemented, If measures. and policies and above the for suggestions recommendations conclusions, provide can promoting research Such and risks”. building climate to capacity adaptation community pro-poor “enhancing may of and poor the ecotones” in management targeting cooperation and population mechanisms “micro-insurance risks”, “establishment climate International for the funds as specialized fields strategies. such in alleviation conducted be poverty implement and design to climate-sensitive organizations international relevant with cooperate can We 7.4 Fieldsforpotentialinternationalcooperation FOUR Climate Change and Poverty Reduction Policies 149 and vulnerability, resilience is often used alongside vulnerability. It usually refers to Resilience is concerned with adjustments or changes in household/community Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage is concerned with the degree to which households and communities have . These ideas have influenced strongly the case study examples outlined later Adaptation decision-making; Assisting the community in responding to change via improving groups participation in Assisting innovation within communities to address the impact of climate change; the ability of communities to cope with the adverse capacity impact to ofanticipate, climateprepare change-tofor, respond theirto, and recover from the impactchange. of climate the ability to cope with, resist and recover from the impact of stresses or shocks induced by climate change. • Strengthening communities assets base; • Ensuring equitable access to these assets by all groups in the community; change; • Disseminating within communities detailed information on the impact of climate • • • Provision of formal settlement rights. Internationally, a key issue for most research has andbeen to policyimprove our understanding formulationof the main infeatures of recentpoor communities’ years adaptive This capacity. has enabled both national and local governments to assist poor communities in dealing with climate change. The Intergovernmental Panel Changeon Climate(IPCC)’s 2007 Assessment Report stresses the importance of and governance humanin assisting communities’ adaptation. capital Most the comprehensively, recent ACCRA Framework states that building communities’ adaptive capacity depends on six basic features: conditions that can enhance their resilience and reduce their vulnerability or to expected observedchanges in climate. Examples of adaptation are communities reforesting to deal with flood-induced landslides; regenerating vegetation to reduce land degradation; rising sea-levels. erecting local wall defences to deal with Internationally, Internationally, the main concepts used in recent years to assess the impact of climate change on poor households, and–more importantly-to plan for assisting households and communities to deal with the impact of climate change are During the last decade, a considerable amountboth ofdeveloped researchand developing has countriesbeen on undertakenthe impact ofin climate conditions.change on poverty The vast majority indicate They change. climate of impact the with deal to abilities ofhousehold’s on influence assessments conclude that povertythat households living isin povertya often powerfulrely heavily on climate-sensitive resources as basis a for their livelihoods. Indeed, overall, poor households appear to rely more heavily on these resources than non-poor households. Additionally, poorhave fewerhouseholds assets usuallyavailable to deal with the adverse householdsimpact also of often climatelive on change. the Poorleast productive or more disaster-prone particularly them make which hillsides), areas, coastal low-lying areas, slum urban plains, lands (flood susceptible to the impact of climate for them to deal with its impact. vulnerable to climate change, and it is difficult change. Poor households thus are particularly Climate Change Studies and Case Experiences International and Poverty Reduction Policies: Appendix Five Appendix in this Note. Vulnerability adaptation Climate Change and Poverty Reduction Policies FOUR 77 150 See The impact of flooding on urban and rural communities, communities, rural and urban on flooding of impact The See Management Research andDevelopmentProgramme, UKGovernment,2005. Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy In whatfollows,wegiveexamplesineachoftheseareas: • Creatingappropriatesafetynetsforaffected communities. • CreatingInsuranceSchemesforSocialProtection; • Developingcomprehensivestrategiesforinfrastructuremitigatingclimateimpact; • Usingcommunitybasedknowledgeinassessingthelocalimpactofclimatechange; • Ensuringclimateinformationisavailableto,anddisseminatedwithincommunities; of way By context. Chinese illustration, theseexperiencescanbecategorisedasfollows: the for in relevance adaptation some facilitating have and may vulnerability change addressing climate of threat under communities poor for protection social providing in countries other of experiences the from lessons However, well knownandpractisedinChina. already is management flood integrated and conditions, climate changing of monitoring suggested to is what seem of Much suggestions communities. internationally in relation to areas such as managing disasters, provision of infrastructure, poor these for of protection social relevant of area most the the in be context, Chinese current the For • • • Promotionofweather-inducedinsuranceschemes. • Diversificationoflivelihoods • Designandimplementationofbasicsafetynets. • Useofsocialtransfers(cashtransfers,conditionaltransfers). assisting for This consensushighlightsthefollowingstrategies: planning change. in climate of impact the from communities poor protect to best how on consensus consideration into taken be to households and communities. Based on these, there appears to be emerging a degree of need features these All with potentially affected communities; involvement of communities in monitoring; in monitoring; particularly in bodies, decisions onlocalinfrastructurerequirements decision-making communities in of representatives community involvement of participation communities; affected potentially with consultations regular radio; and television via primarily reliable conditions and changing on regular updates of dissemination sites; internet via mapping flood of results the of provision the on: depend to found was dialogue Successful the communities. flood-affected for with dialogue meaningful Department developing on crucially depends households poor on Government’s flooding the areas, of impact the urban addressing that concluded (DEFRA), AffairsRural and and Food Environment, rural both in impact flooding social of the of survey comprehensive recent, a following Kingdom, United the In Dissemination ofInformationwithinPoorCommunities: or by changing the crops they plant. References are made on several occasions occasions several on made are References plant. to they crops farmers decisions, the planting enabling their changing adjusting by by or communities, problems rural induced in climate potential to seasonal particularly respond longer-term crucial for is systems This on work in forecasting. or patterns, representatives rainfall in community or temperature involving in changes sudden of warnings example: transmitting For in households. poor conditions, of climate securities livelihoods local the of for poor importance forecasting their within given possible) (if capacities and developing monitoring of for communities importance the on focus commentaries Many Access tocredit–andparticularlymicrofinance. The promotionofpublicworks. DEFRA and the Environmental Agency Flood and Coastal Erosion Risk Risk Erosion Coastal and Flood Agency Environmental the and DEFRA 77 . FOUR Climate Change and Poverty Reduction Policies 151 Climate and , UNDP, New York, 2007 York, New , UNDP, ; 83 , cite ; in Sri 82 , the World Bank, Washington, 2010, p.106. Bank, Washington, , the World , which has developed a 78 Recent reports, such as that 80 Development and Climate Change World Development Report 2010: Development and Climate Change Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage No.1, The Earth Institute, Columbia University, New York, 2007. York, New The Earth Institute, Columbia University, No.1, . . There are many similar cases: In Nepal, for example, where local communities 81 79 Human Development Report 2007/200 Fighting Climate Change: Human Solidarity in a Divided World See Tanner, T.M, et al, “ORCHID: Piloting Climate Risk Screening in DFID Bangladesh”, Research Report, Institute of Development Studies, University of Sussex, Brighton, UK, 2007. Also, Department for International Development (DFID), “Bangladesh Chars Livelihood Programme”, London, 2002. See International Research Institute for Climate and Society, “Climate Risk Management in Africa: Learning from Practice”, See Practical Action, “Rainwater Harvesting”, October, 2007. Action, “Rainwater Harvesting”, October, See Practical See UNDP, 2007, 4, above. See UNDP, See Quote taken from Society programme for transmitting rainfall and soilof moisturefarmers’ informationorganisations, through non-governmental a network Perhapsorganisations, of relevanceand localfor governments.the Chinese contextfarming ishouseholds the successregular of bulletinsdistributing on severalto agro-meteorological assessments,poor the programme appears information.to have been successful.Based For onexample, maize yields were higher in those areas participating compared with communities who did not participate. Assessing community involvement in monitoring, UNDP cites a key problem area in community involvement in monitoring, namely the unequal distribution of information, with poor households often located zones in what it terms “information-free” Lanka farmers have recently developed rice varieties to withstand saline intrusion farmers in Ecuador have designed U-shaped detention ponds to recharge aquifers of of the World Bank 2010 Development Report, 83 82 79 80 81 78 The importance of drawing on community based knowledge in assisting poor households in adapting to the adverse economic and social aspects of communities general, “In that climateexample, for argued, is It changecommentaries. many in repeatedly is stressed have better time, place and event ofspecific how suchknowledge hazards ofaffect localtheir climateassets andhazardshave productivegreater andcapacity activities.to manage Communitieslocal social alsoand ecological affected relationshipsby climate change. thatAnd they will typically be incur lower costs than external actors in implementing development and environmental projects” Community-Based Knowledge Community-Based to the case of the national meteorological service in Mali have have designed and built watchtowers as part of a local early-warning system examples of the use of community knowledge and participation by poor communities in reforestation programmes, in fisheries renewal, in nature reserve managementprotection of andcoastal areas. in There is little point in describing these cases in detail, since the practices described are used widely in Chinese programmes, in each of these areas. There are, some however, case studies that may be of interest: Recent developments in several countries reveal the cost-effectiveness of using poor communities’ knowledge. In Bangladesh, for example, the low-lying islands in containthe someGanges/ of Brahmaputrathe poorestDelta communities in the flooding.country, and areWith subject donorto frequentand government constructedassistance, earth platforms, planted groupswith trees ofand grass poorto restrict householdserosion, to their homes. They protect have also installed havehand pumps and basic latrines, to improve access to clean water and sanitation. Poor communities supply their labour and input their local knowledge. Creating the 125,000 raised platforms to protect the poor households in the delta will cost US$17 million. it However, is estimated that for each US$1 spent, US$2-3 will be saved in protecting productive assets that would otherwise have been lost during floods Climate Change and Poverty Reduction Policies FOUR 86 85 84 152 and Rural Development Discussion Paper no.36 Paper Discussion Development Rural and See Nguyen Than Binh, “Vulnerability and Adaptation to Salinity Intrusion in the Mekong Delta of Vietnam–Preliminary Findings from Tra from Findings Vietnam–Preliminary of Delta Mekong the in Intrusion Salinity to Adaptation and “Vulnerability Binh, Than Nguyen See See, for example, J.Linnerooth-Bayer and R.Mechler, “Insurance for Assisting Adaptation to Climate Change in Developing Countries: ACountries: Developing in Change Climate to Adaptation Assisting for “Insurance R.Mechler, and J.Linnerooth-Bayer example, for See, See, for example, P.O.Manuamorn, “Scaling Up Micro-insurance: The Case of Weather Insurance for Smallholders in India”, in Smallholders for Insurance Weather of Case The Micro-insurance: Up P.O.Manuamorn,“Scaling example, for See, the Security,Human and Environment for VinhInstitute Province”, University, Nations for United produced documents the also See 2010. Bonn, “Weather Index Insurance for Agriculture and Rural Areas in Lower Income Countries”, Department of Applied Agricultural and Applied Applied and Agricultural Applied of Department Countries”, Income Economics, University ofGeorgia,2006. Lower in Areas Rural and Agriculture for Insurance Index “Weather Proposed Strategy”, Mekong Delta Climate Change Forum Change Climate Delta Mekong Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy Climate Policy Climate , 6:621-36. during drought years. In each of these cases, local knowledge from poor communities communities has provencost-effective indevisingsolutions. poor from knowledge local cases, these of each In years. drought during and their role in adaptation to climate change climate to adaptation in role their and mechanisms micro-insurance of discussion considerable been has there years, recent In programmes. employment/workfare and transfers, cash/in-kind nets, safety appropriate transfers, cash on Based related insurance of use the in mostly interested are we protection. Report, the in covered areas the social of areas the in countries developing other poor from for examples consider mechanisms to helpful be may it this, compensation to relation In and change. climate from nets risk at households safety relevant of importance the on focuses Reduction Poverty and Change Climate on Report Initiative UNDPStrategic The Social ProtectionforPoorCommunities:InsuranceSchemes Delta the in households poor of net needs the safety directly address its policies health and local and provision framework, economic term medium its with and strategy, reduction of Ministry The areas. mangrove country’sthe poverty of overall implementation the with Agriculture’s co-ordinated is work rehabilitating and ditches, and dykes reinforcing in communities poor involves and assessments, participatory community on This a heavily Delta. relies River devised Mekong the has in households poor Agriculture to of risk disaster Ministry reducing for The strategy alleviation. poverty with a inter-relates where which also strategy case, flooding-a to response Vietnamese in the developed is been has strategy however, comprehensive which exception, from possible A internationally, learn. can experiences, China few are there Consequently, poor on notably communities. impact, bureaus their and environmentally with dealing of agencies in its co-operation of impact and systems etc, the developed have drought, with mudslides, dealing in disasters–flooding, induced experience substantial has China Comprehensive StrategiesforPoorCommunities limited financial assets. Critics have suggested that poor farmer’s participation may be may participation farmer’s poor that suggested have Critics assets. financial limited have and poor are households when particularly useful are payments rapid Such claims. insurance file to needing households without organisations, microfinance local of use the these in through quickly,often disbursed Experiences and calculated gauge. be can payments rain that indicate countries local a on recorded rainfall and as such Malawi index, by triggered public events Mexico, a climate of result a as made countries–Thailand, are payments case other each in In Mongolia. years recent in introduced been when the shortfall in precipitation becomes severe becomes precipitation in shortfall the farming when smallholder compensation providing scheme example, insurance for “weather-index” can a in India, base participate in households assets needs, whose such meet To households eroded. poor for quickly be important particularly is it but climate of events, impact the from resulting losses against protect can particular, in insurance , Hanoi,2009. 84 . Bysuchmeans,thestrategybecomescomprehensiveinitsapproach. , World Bank, Washington DC, 2007. More generally, see also, B.J.Barnett and O.Mahul, and B.J.Barnett also, see generally, More 2007. DC, Washington Bank, World , 85 . In general, insurance, and micro- and insurance, general, In . 86 . Index-based insurance has also also has insurance Index-based . Agriculture Agriculture FOUR Climate Change and Poverty Reduction Policies 153 , World , Bank World Policy International Workshop Presentation to the , UNDP/IPRCC, 20/2/2011, Beijing. , UNDP/IPRCC, 20/2/2011, Social Inclusion or Poverty Alleviation? Lessons from Recent Brazilian . If they are appropriately 90 In China, weather-index based 87 Conditional Cash Transfers: Reducing Present and Future Poverty , despite problems of lack of sufficient skilled 88 . Similar larger-scale schemes can be found in other Latin 89 sold its first micro-insurance policy in September, 2008, in Shaanxi Province. Currently the company is the world‟s Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage , CID Graduate Student and Research Fellow Working Paper no. 27, Center for International Development, Harvard University, Addressing Multiple Risks through Microinsurance: Lessons from the Field in India. largest insurer by value, having issued nearly 4 million micro-insurance policies, valued at $US 20.2 billion, as of July 2010. Anuradha See K.Rajivan, Research Report, Washington DC, 2009. Research Report, Washington for loses during severe winters. Compensation is based on the average livestock mortality rate in their district. The scheme is operated by the government in co-operation with local insurance organisations. 2008. See, for example, Vanessa Maria de Castro and Marcel Bursztyn, See, for example, Ariel Fiszbein and Norbert Schady, Ariel Fiszbein and See, Norbert for Schady, example, on Challenges and Response to Poverty Reduction in China’s New Development Stage Experiences An interesting and relevant weather insurance scheme case is that implemented for livestock herders in Mongolia. Herders are compensated compensated are Herders Mongolia. in herders livestock for implemented that is case scheme insurance weather relevant and interesting An China Life Insurance targeted, they can raise consumption levels and reduce However, the poverty. evidence improving health and education conditions as a for result CCTs is rather more mixed. For appear to example, increase whilst the CCTs likelihood of children from poor households going for preventive health checks, this has not always led to improved nutritional 90 89 88 87 One of the most notable results of the impacts of climate change–particular in relation to floods, landslides, and drought-is the removal of children from school by poor families, in an attempt to increase their supply of labour, conditionaland on to schoolreduce attendance costs. can Cashmeet shorttransfers term needs and incentivegive households to an keep their children in school. Transfershealth similarlyconditions throughcan requiringaddress attendanceworsening at health clinics. The conditional most transfer well-knownschemes are in Brazil, with its Bolsa Familia Programme (currently covering almost 50 million people, or a quarter of the population) requiring health clinic and school attendance Cash Transfers Cash Transfers limited by household credit constraints and by partial scheme.understanding Overall, of however the the insuranceweather index schemes seem to have beenin the successful countries in which they have been implemented As the Climate Change and Poverty Report notes, the adverse impacts of climate change change climate of impacts adverse the notes, Report Poverty and Change Climate the As can erode the assets of poor households, seriously affecting their employment, income, health and As nutrition. it also notes, well-designed social protection schemes can afford some protection to poor households. In relation to these schemes, relevant case studies those for transfers cash areas: three into categorised be usefully can countries other from in poverty as a result of the impact of climate change; transfers in kind; and employment programmes. partners for distribution, inadequate local product design and adaptation, and lack of data data of lack and adaptation, and design product local inadequate distribution, for partners on exposure and risk. insurance schemes could be included in overall micro-insurancehave developed rapidly programmes,in recent years which Much evidence suggests that households, conditionaland particularly so under crisis conditions cash transfers (CCTs) can benefit poor American countries such as Mexico and Nicaragua. Latin America Indeed,now has a almostcash transfer everyprogramme. In Asia, countryIndonesia and inBangladesh have such programmes, and Cambodia and Pakistan have pilot cash transfer schemes. Currently, Africa’s most notable Cash Transfer scheme is subsistence infunds dependent Zambia,on regular school providingattendance. The Ethiopian basicGovernment similarly targets families facing food insecurity, guaranteeing five days return for food or cash transfers. employment in Climate Change and Poverty Reduction Policies FOUR 93 92 91 94 154 Opportunities for improving gender equality gender improving for Opportunities Social Protection and Labor and Protection Social Cited inOxfam, See NationalRuralEmploymentGuarantee Act, 2005:http://nrega.nic.in 2009. For examples of these differences, see UNDP,al, see Waterdifferences,et Global these Alliance of examples For See C. del Ninno, K.Subbarao and A Milazzo, “How to Make Public Works Work: A Review of the Experiences”, the of Review AWork: Works Public Make to “How Milazzo, Aand K.Subbarao Ninno, del C. See researched and document case study of the impact of climate change on women, see Oxfam, see women, on change climate of impact the of study case document and researched led by Tran Van Anh, Hanoi,2009. Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy Responding to Climate change in Vietnam: Opportunities for improving gender equality gender improving for Opportunities Vietnam: in change Climate to Responding , World Bank,Washington DC,2009. Drought, deforestation, and erratic rainfall force women, who are often already already income, receiveaneducationortraining,toparticipatein decision-makingprocesses. often are who an earn to time less have Consequently, women, they fuel. water, and food, for needs household force meet to rainfall order in harder work to resources, natural local erratic on dependent and marginalized and deforestation, Drought, inputs”–seeds andfertilisers,forexample. to cash without and seeds, purchase seeds. Under these conditions, transfers can comprise packages of “productive without left are Farmers problems. serious, nutritional facing households short-term, with crops destroy can floods or droughts as such shocks Climate cash. in made be necessarily not need conditions crisis under made Transfers evidence thusfarofimprovementsinlearningoutcomesschools. little is there increased, have enrolments school whilst Similarly, children. the for status and women have distinct roles, responsibilities and status, giving rise to differences differences to rise giving capacity adaptive and status, vulnerability and in responsibilities roles, distinct have women and men societies, many In differently. households poor in men and women affects change important issue of the particular impacts of aspects of climate change on women. Climate the raises programme Indian the in employment women’s for requirement specific The Gender Issues countries net many safety in change the climate of to part response important an are programmes workfare China, in case the is As Workfare Programmes almost fivetimeshigherforwomencomparedwithmen male a was without rate death the Bangladesh, in house flood and cyclone 1991 their the In them. escort to leave relative to unable are they or spheres; public in transmitted usually information warning and preparedness emergency for information critical receive to likely less are they themselves; before children their protect to try they occur; disasters when home at be to likely more are they swim; to learned not have they mean that norms cultural of result a as floods, and hurricanes as such disasters, climate-related of injuries) and as economic actors. Women givers, are more likely to become direct victims (mortalities and care as health, of guardians as providers, and producers food as roles multiple their through affected are They opportunities. and resources to access unequal through 45 million households have contributed 2 billion days of labour for the completion of 3 of completion million tasks the for labour of days billion 2 contributed have households million 45 2005, in began programme the Since injuries. work for insurance medical and care child on-site providing to addition in women, to available made be to work the of third a least for employment of days at importantly,for 10 Most provides household. also poor programme volunteering the every of provision its with Programme, Guarantee Employment and India’s tried of that the is case to notable a addition programmes, employment In China’s of successes tested embankments. and systems, such areas irrigation in storage, resilience, water as community poor of strengthening the and asset-building on , Hanoi,2009.Seealso,UN-Vietnam, 92 . Gender and Climate Change: Training Manual, Training Change: Climate and Gender Gender and Climate Change in Vietnam in Change Climate and Gender 93 . Women are often particularly disadvantaged disadvantaged particularly often are Women . 91 . Successful programmes have focused have programmes Successful . Responding to Climate change in Vietnam: Vietnam: in change Climate to Responding 94 , Hanoi,2009. . Discussion Paper 0905, 0905, Paper Discussion , written by a team 2008. For a well a For 2008. FOUR Climate Change and Poverty Reduction Policies 155 monetary resources; basic infrastructure; skills, knowledge, beliefs, attitudes; forests, water, land, energy sources; forests, water, relationships, social networks, customs. Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage Human Assets: Social Assets: Natural Assets: Physical Assets: Financial Assets: The Assets Framework is useful for understanding poverty communities,conditions in villagesand and in developing appropriateapproach we assess the assets held by poor strategies households. These may be one or several for tackling of the following types: poverty. In this Endnote: TacklingAssets: Household Poverty through Building and Managing In many areas, climate change creates resource shortages and unreliable job markets that lead to the increased migrationagricultural and households duties. of Traditional roles men,are therefore reinforced, leavingthe ability women of women to diversify their livelihoods or to alone access income-generating jobs is diminished, with additional and girls are often taken out of school to deal with the increased burden. Women’s high level of vulnerability is itself a significant factor in the overall vulnerability of communities, given that women produce more than 50 perconsiderably cent moreof inthe manyfood developinggrown countriesworldwide (forand women examplecontribute 60 to in 80 sub-Saharanpercent of the Africalabour in both food production for household consumption and for sale), in addition to their significant roles as carers of children, the elderly and the sick. In managing their assets to promote more deal sustainablewith their poverty livelihoods,by using a range communitiesof strategies. These differ canfrom one location to another. Once we understand these strategies, we can devise ways of directly assisting poor villagers to manage their assets more productively and efficiently.We can design in partnership with poor village communities. relevant strategies to reduce poverty, The assets approach focuses on the ways in changingwhich poorconditions communitiesin orderadapt to to maintaintheir and improve an theiranalysis of livelihoods.household and community It strengths, beginsand emphasises withthe importance of building the potential of poor households and communities for achieving sustainability. It enables us to identify and deal with constraints to the fullest use of available through designing appropriate policies for poor villages. assets, Managing these assets is critical for poor households and communitiesimprove as theirthey try povertyto conditions. Households bycan improvingcreate access differentto, and livelihoodcontrol over relevantoptions sets of networks can assets.be utilised to create Formore secure conditions example:for gaining access to financial social resources; local knowledge can deal with changing conditions in access to natural capital (such as changing forestry, soil fertility); cultivation skills can used in crop diversification, etc. Climate Change and Poverty Reduction Policies FOUR 156 Policy Study on the Challenges and Responses to Poverty Reduction in China’s New Stage New China’s in Reduction Poverty to Responses and Challenges the on Study Policy promoting equitable access to self-sustainable services for the poorest–increased poorest–increased the for services tools self-sustainable economic to of access paradox The equitable Editorial: promoting Baruwa. M. Elaine and Frick D. Kevin 18. Rethinking for Framework A Economics: Structural Development. 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