China has vowed to provide more forceful support for the agricultural sector and revitalise rural areas, saying they are the “bedrock for a new era of development” in which Beijing aims to make the economy more self-reliant and insulate it from external uncertainty.
At the conclusion of the two-day Central Rural Work Conference on Tuesday, President Xi Jinping said after eliminating absolute poverty this year, the government would undertake “a historic shift” to focus on “comprehensively improving” the rural economy in 2021.
Boosting rural incomes and spending power will be a key element in Beijing’s so-called dual circulation economic strategy, which will rely more on domestic demand and home-grown technology to power growth, Xi said.
Get the latest insights and analysis from our Global Impact newsletter on the big stories originating in China.
But to achieve that, the government must first address the nation’s widening income gap between urban and rural residents.
The world’s second largest economy must improve efficiency in the agricultural sector, make rural areas more suitable to live and work in, and ensure that farmers are well-off, Xi said during the televised conference that set rural policies for 2021.
“Stabilising agriculture, rural areas and farmers are the bedrock for the new era of development,” Xi said, according to the official Xinhua News Agency.
“Rural areas have huge room and potential to boost domestic demand, which is the core for China’s new development strategy. It is the heaviest task in building a modern socialist country.”
At the meeting, a draft plan to reinvigorate rural areas and accelerate agricultural modernisation was discussed, but details were not disclosed.
Xi first highlighted the need for rural revitalisation in 2017, although the government has continued to count on urbanisation to drive national growth and create jobs.
Rural development has moved up the government agenda because of national security – including food security – and has already been put on an equal footing with economic development.
Xi’s 2019 statement that “the rice bowl of the Chinese people, in any situation, must be firmly held in our own hands” has been highlighted in central government documents throughout the year.
On Tuesday, the president told provincial governors and party chiefs to take political responsibility for securing the nation’s grain supply.
The government will ensure the country has at least 1.8 billion mu (120 million hectares) of arable land, increase the amount of high-quality farmland, conserve soil and speed up breakthroughs on key agricultural technologies, according to the Xinhua report.
To boost enthusiasm among farmers, the government will stabilise and enhance subsidies, improve the minimum purchase prices for grains and government stockpiling, and expand crop insurance coverage, it said.
The slow development of rural areas threatens to undermine the goal of creating “common prosperity” by 2035, the target set at the Communist Party’s fifth plenum in October.
Beijing has long promised to develop China’s vast rural areas, but policies to date have failed to narrow the urban-rural income gap.
The divide could expand further because rural migrant workers were hardest hit by the economic impact of the coronavirus pandemic this year. For example, average per capita income among rural residents was 12,297 yuan (US$1,882) in the first nine months of this year, only 37.5 per cent of that among urban dwellers.
The Gini coefficient, which measures inequality across a population, stood at 0.465 last year, a small drop from 0.468 in 2018, but an indication of severe inequality among Chinese people, according to the National Bureau of Statistics. The Gini index ranges from zero to one and the higher the figure, the greater the inequality.
Rural ownership of cars, home appliances and other durable consumer goods is far behind that of urban households, with rural residents’ spending power fundamentally restricted by the slow growth of their income.
About 600 million of China’s 1.4 billion population still earn an average monthly income of 1,000 yuan or less, official data showed.
More Articles from SCMP
This article originally appeared on the South China Morning Post (www.scmp.com), the leading news media reporting on China and Asia.
Copyright (c) 2020. South China Morning Post Publishers Ltd. All rights reserved.