The Chinese economy has grown tremendously and continues to expand, bringing fortune to the country and its people. Destination sites are seeing this expansion via an increase of Chinese tourists. The growth is exciting as the generations change from barely surviving to having expendable income. However, there is still an income gap in China that must be faced. Anyone traveling from the city to the countryside can see the disparity in wealth.
The Chinese economy really started to make a turnaround when Deng Xiaoping became the country’s leader in 1978. He began implementing major economic reforms that caused the economy to boom in such a way that its growth averages around 10 percent a year. This average is three times higher than the development of any other country. These economic reforms changed China so quickly and brought so much wealth to the country that the world began to take notice. China began purchasing and buying in other countries and became the world’s biggest exporter in 2009.
While this brought huge amounts of wealth into the country and changed many people’s lives, it also left others behind. In 2016, only 1 percent of Chinese citizens held over one-third of Chinese wealth while the poorest quarter held only 1 percent of Chinese wealth. A look at cities versus the countryside reveals the income gap in China. A visit to one of China’s great cities such as Beijing, Shanghai or Xi’an reflects China’s great innovation, but a quick drive to the countryside will find ramshackle homes that have been poorly repaired with cheap scraps.
This disparity can seem overwhelming and appear that, despite China’s prosperity, many are left in poverty. Thankfully, this is not necessarily the case; the poverty rate decreased from 26.7 percent in 1998 to 13.8 percent in 2010. China’s growing economy also means a growing middle class. From 2002 to 2012, China’s middle class grew by over 25 percent. However, this quick growth has caused a great migration into cities, which has left some cities ill-equipped to handle the large influx in population, and the countryside with little financial stability or ability to maintain infrastructure, as well as shooting up the cost of living in urban areas.
As of 2016, people living in cities made 2.7 times more on average than those in the country. The main problem of inequality lies with geography. Restrictions have been put in place that prevent or limit those living in the countryside from relocating or selling their homes. However, despite these problems, the incomes of those in the countryside have grown tremendously during the last four years. The current leader, Xi Jinping, has put particular pressure on various areas of business and government to clamp down on corruption, which has had a positive impact on breaching the inequality between citizens, as well as improving healthcare, education and welfare.
The income gap in China does still exist, but the redistributive policies have reined in the corruption and created an awareness for those with little social mobility. Rural areas are still lagging behind, but if one thing is true, it is this: lives are improving. Chinese citizens are able to travel, the middle class is growing and the government is taking notice of inequality. While China still has some steps to take, the last 30 years have shown how dramatically China can progress and use policy to enhance its citizens’ lives.
– Natasha Komen
Photo: Good Free Photos