Commuting poverty

Mar 16th 2006 | BEIJING
From The Economist print edition

Poor peasants surround Beijing

“EUROPEAN cities with an African countryside” is how a report published in China this month describes the gap between booming Beijing, the nearby port-city of Tianjin and a “belt of poverty” around them. It is an exaggeration. No Chinese city has western European levels of development, and African-style deprivation is rarely seen in China. Yet the gap is huge and growing. For increasingly vocal critics of China's imbalanced development, it is a particularly alarming example.

In recent years China's leaders have themselves stressed the need to narrow regional imbalances. This was a major theme of the annual ten-day session of China's parliament, the National People's Congress, which ended on March 14th. The 3,000 Communist Party-picked delegates approved a budget that promises more cash for farmers and a new five-year economic plan to create a “virtuous synergy” between the wealthy seaboard, central China and the poor western regions.

Yet criticism of these disparities has also become a way for some to air more general grievances about China's embrace of capitalism. The government recently shelved plans to submit a new property law to the congress after a chorus of opposition, led by a Peking University academic, Gong Xiantian. He argued that the draft, which protected property rights, was un-Marxist and unconstitutional.

Though state-controlled, China's media are adept at pinpointing issues that embarrass officials. One example is the comparison of Beijing, Tianjin and their surrounds which appeared in an annual report on regional economies in China by the Beijing Academy of Social Sciences. One Chinese web portal devoted a special page to reports on the poverty belt, with a headline “so close and yet so far”. A commentary in the Farmers Daily, published by the ministry of agriculture, said the poverty of areas of Hebei Province around Beijing and Tianjin was “astonishing”.

The academy's report echoed the findings of an Asian Development Bank study published last year. It said the belt consisted of 32 counties, mostly to the north and north-west of Beijing and Tianjin, with an impoverished population of 2.7m living in nearly 3,800 villages. Poverty is defined as an annual income of less than 825 yuan ($102). The average urban income in Beijing last year was 17,653 yuan a year. Chen Mengping, one of the report's editors, says many of these villages are in mountainous places whose economies have been hit by a bid to improve the purity of Beijing's water, which they supply. This has involved closing factories, and planting trees instead of crops.

According to the ADB study, these areas represent extremes of poverty in a province that has failed to cash in on the growth of Beijing and Tianjin. Hebei has more officially designated “poor counties” and probably more people living in poverty than any other eastern province, it says (though officials say their numbers have been falling). Hebei's failure to develop more rapidly is in marked contrast with the hinterlands of Shanghai and Shenzhen. Wealth has radiated from these thriving port cities as manufacturing industries have mushroomed around them. Hebei has a bigger state-owned sector than the areas around Shanghai and Shenzhen—no recipe for fast development—and relatively little foreign investment.

Politics is partly to blame. The cities of Beijing and Tianjin enjoy provincial status and the advantages of being the capital city and a major port. Hebei has received fewer favours. Central government assistance in recent years has focused on China's west and the north-eastern rust belt. Some Hebei delegates at the National People' s Congress openly grumbled that their province had not been rewarded for sacrifices it had made for the two cities: providing them with water, and curbing industrial development to keep it clean.