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What China is doing for poverty alleviation?

China is the most populous country in the world, with more than 1.4 billion people.
Its economy growth is incredible, and yet there are still millions of cases of poverty in China.
But things are now better than they were. As a matter of fact, since 1978 China raised more than 750 million people out of poverty. That alone amounted to 50% of the global poor population.
An amazing achievement. While poverty alleviation is a task that many developed countries still are working on, including the USA, China instead vowed to end absolute poverty by the end of 2021.

2018‘s absolute poverty headcount ratio according to international poverty line (under 1.90$ per day). Interestingly, the % of people in absolute poverty is lower in China than in some Western countries, like Spain, Italy and USA. Source: Wikipedia

2021 is the centenary of the Communist Party of China. Chairman Xi promised to achieve a moderately prosperous society in all respects by then.
This objective includes, as a minimum, to have 0 people under the national poverty line.
The national poverty line is not the same as the international poverty line – its requirements are actually higher.

How does poverty alleviation work in China?

According to the Chinese government, a person can be considered as lifted out of poverty if all the following are true:
1. Income is above the national poverty line of 3.2 USD per day. By comparison, international poverty line, set by the World Bank, is 1.9 USD per day. Both are adjusted by Purchasing Power Parity (2011);
2. Must live in a decent housing, with electricity, running water and a proper roof;
3. Any child should be going to school; illiterate adults need basic education, too.
All the work that needs to be done to ensure these three points is on the shoulders of the poverty alleviation commissioners. They are members of the Chinese Communist Party who volunteer to go far away from their homes to help lift people out of poverty. As such, they need to do all kinds of tasks, from building modern houses to teaching basic hygiene.
As one may guess, it is also a dangerous job. Almost 800 commissioners already lost their lives on duty, but their results are incredible.

Number of poor and poverty rate in rural areas, 1978–2017
China’s results in fighting poverty in rural areas from 1978 to 2017. Source: Unicef

CGTN made a documentary about a poverty alleviation commissioner’s work in late 2019, showing the issues and the challenges of poverty alleviation.

Making sure people won’t get poor again anymore

The Chinese approach against poverty has been effective especially thanks to long term planning. It is not enough to just provide subsidies to survive. Otherwise, once the subsidies are removed, people will just fall back into poverty again.
Chinese government believes that the basis for overcoming poverty is education.
For this reason, commissioners need to both ensure that children go to school, instead of working in the fields, for example. Adults have to receive some basic schooling as well.
In order to do that, they combine economic aid and support the adoption of new technologies, especially in farming. For example, schools provide lunch for children in the most impoverished areas. Some parents will send them to school only to have a free meal.

While COVID-19 is not exactly making things easier, China has very good chances of finishing the job right on time. After that, it will be time to work on other categories of poor people: not in absolute poverty but, anyway, needing aid.
Any international business should follow the efforts of the Chinese government. That’s because the middle class of China is growing also thanks to these efforts, which means an even larger market.

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