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An Introduction to Pro-poor Policies for Development since Reform and Opening-up. PROF. DR. LI XIAO-YUN. College of Humanities and Development China Agricultural University 2005.12. Contents. 1.Pro-poor micro-policies for development

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Prof dr li xiao yun

An Introduction to Pro-poor Policies for Development since Reform and Opening-up


College of Humanities and Development

China Agricultural University




1.Pro-poor micro-policies for development

1.1The policies of education and human resource development

1.2Policies related to Social Securities

1.3Policies related to Agriculture and Environmental Protection

1.4 Policies related to the Land use

1.5Policies related to Infrastructural development

1.6 Policies related to Population and Family Planning

1.7 fiscal policies

2. Policies Conducive to the Development of the Urban Poor on the Micro Level

3. Regional Development Policies Conducive to the Development of the Poor on a Macro Level

4. The View Point of Scientific Development

5. Macro Economic Adjustment and Control Policies

6.Policies for Poverty Alleviation in Developing the Rural Area

1 pro poor micro policies for development

1.Pro-poor micro-policies for development

1.1 the related policies of education and human resource development

1 policies for compulsory education

1 Policies for Compulsory Education

  • China’s Compulsory Education Law stipulates that all children aged 6 or above should receive the required 9 years education in a school . The state provides free education for students receiving compulsory education.

  • On November 10, 2005, the Ministry of Education released the State Report for National Education in China, said:

    • poor students in rural areas shall get free textbooks and boarding allowance in 2007

    • free compulsory education should be enjoyed by rural areas throughout China in 2010

    • everyone can receive free compulsory education in 2015

    • Financial Minister: next year

  • the education burden has become one of the heaviest for farmers in the last two decades

2 vocational education policy

2 Vocational Education Policy

  • Vocational Training includes pre-employment training, military-to-civilian training, apprenticeship, on-the-job training, job-change training and others.

  • government at all levels may use part of the budget for science and technology development and the promotion of techniques in an appropriate manner for rural vocational training.

Vocational education produce a large number of professional technical personnel in a timely manner and in line with market needs. And it is very important in promoting the development of the rural areas and farmers by providing the skills training in basic agricultural production.

3 two exempts one subsidy policy

3. “Two Exempts, One Subsidy” Policy

  • Starting from the autumn of 2001, the Ministry of Finance and Ministry of Education have jointly given away free textbooks to students who are at the compulsory education stage and from impoverished families in the western or mid-western part of China.

  • From the autumn of 2004, the government has been implementing the policy of the “Two Exempts, One Subsidy” Policy, which means that students from these poverty-stricken areas are exempted from miscellaneous fees and textbook costs, and given a subsidy for accommodation.

Prof dr li xiao yun

  • central government has increased eligibility for free textbooks to all the 24 million plus primary and middle school students from poor families in the western and mid-western regions from the autumn of 2004

  • in 2005, the funding for the “Two Exempts, One Subsidy” program will reach RMB6.4 billion, which will benefit 26% students of the mid and western regions, and will benefit 40% students in 592 national poverty alleviation counties.

The policy has lessened the economic burdens for those poor families from the western and mid-western regions , and increased enrollment rate for the compulsory education in those area.

4 one fee system

4 .One Fee system

  • The practice was a result of combating the arbitrary collection of from students by schools of basic education

  • the government introduced this one-fee system into some impoverished regions in 2001, which refers to the setting up of a ceiling for the collections of fees and textbook costs, and except for this fee, no other fees were allowed to be collected from students.

  • The cost of textbooks was based on the list of textbooks (excluding auxiliary teaching materials ) that conformed to teaching guidelines issued by the ministry of education ,and that were in the catalogue of textbooks and necessary student books compiled by the provincial education administrative department.

The implementation of the policy had achieved impressive results in curbing arbitrary collections, particularly in compulsory education in rural areas, and had reduced the educational burden of farmers.

5 rebuilding the dangerous houses of the rural elementary and middle schools

5.Rebuilding the dangerous houses of the rural elementary and middle schools

  • Since reform and opening, with the degradation of the rural collective economy and the reform of the rural financial system, investment in compulsory education, which has been decreasing year after year, which was proven by the existence of a great number of dangerous houses.

  • From 2001 to 2005, the government has allocated a proprietary use fund of RMB9 billion , to support the reconstruction of dangerous houses in rural schools in poverty-stricken areas in the western and mid-western regions.

The implementation of this policy provides a guarantee for the educational facilities in those poor areas, and is beneficial to the development of compulsory education in rural areas. this policy is of great importance to the long-term development of human resources in rural areas.

6 students loan policies

6 Students’ Loan Policies

  • The national students’ loan aims at the perfection of students’ assistance policy system though financial means by the state, and strengthens the assistance to poor students in institutes of higher education.

    • The student needs no guarantee or mortgage for a loan.

    • The national students’ loan policy provides that annual loan by the student should not exceed RMB6,000.

    • He should repay the principal and interest within 6 years after his graduation.

    • The interest for the loan when the student is in university is paid by the state coffers, and the student is to pay back the interest and fines, if any, as well as the principal after he leaves college.

The policy plays a basic safeguarding role in helping the poor student finish his studies in university and in uplift his overall qualities, and is, generally speaking, conducive to the long-term development of the poor.

7 the related policies for migrating children s education in city

7 The related policies for migrating children’s education in city

  • the compulsory education system adopts a “Schooling and Management Hierarchy”, which means that basic education is the responsibility of the local government, where one has his permanent household registration.

  • the children of migrant workers are denied access to public schools there, which are funded by the local government.

  • in 2003 , the State Council ordered the local government in the city responsible for the basic education of the migrating children

  • The local government of the city should work out education costs’ standards for the compulsory education of migrating children, exempt them from certain fees, and charge them the same rate as the local students.

The policy that gives children of migrant workers access to the local school relieves the heavy burden of paying additional fees for non-natives for education in the city.

8 the sunlight project for the training of rural migration labors

8 The Sunlight Project for the training of rural migration labors

  • The Sunlight project for the training of rural migration labors, supported by government finances, refers to those professional skills training and example-setting projects mainly in the grain-producing regions, labor-exporting regions and old revolutionary bases enabling the transfer of labor from agricultural into non-agricultural areas.

    • From 2006 to 2010, The rural human resources will be tapped more intensely so that a total of 30 million rural people will get training with 6 million to be trained each year.

    • After 2010, the training of rural labor will be incorporated into the national education system.

    • The Sunlight Project’s training programs focus on short-term (15 to 90 days) training of professional skills, to be supplemented by some guidance training.

The Sunlight Project, as one sponsored by the central government will continue to play the important role in strengthening the western and mid-western’s ability to export more workers.

9 the distance education project for the rural basic education

9 The distance education project for the rural basic education

  • Modern distance education for primary and middle schools in poverty-stricken rural areas is a comprehensive information technology project whose aims are to build an educational information portal for poor areas, and to accelerate the modernization of education for poor areas.

    • The central government invested RMB1 billion with an additional RMB0.91 billion coming from local government in the pilot projects

    • These distance education places cover around 25% of rural primary and middle schools in the west, around 21% of all rural schools in the middle.

    • The results are the creation of 20977 places for playing teaching discs, 48605 places for receiving teaching programs through satellites, 7094 computer classrooms.

the utilization of modern information technology makes possible the sharing of better resources across the country, which is a great impetus to the development of human resources in the vast poor areas in the middle and western regions.

1 pro poor micro policies for development1

1.Pro-poor micro-policies for development

1.2The social security policies

10 the minimal rural social security system

10 The minimal rural social security system

  • security system is a “life line” system by China’s government guaranteeing low income families their minimum needs in life.

  • The minimum social security system first appeared in Shanghai in 2003, the rural assistance system was created.

  • At the end of 2003, 1.915 million families or 3.968 million people benefited from the rural minimal social security in the pilot areas, while 4.1 million families or 792.15 million people could receive rural periodical assistance.

  • The rural minimal social security level should be determined by taking into account the costs of clothing, food, accommodation, and so on for the local rural resident to maintain the minimum living, and costs for utilities and heating and the education of minors.

The implementation the rural minimal social security is of great significance for meeting the minimum needs of the rural poor and for upholding social justice, and provides a basic protection for the poor to further develop themselves.

11 rural pension system

11 Rural pension system

  • Rural pension refers a system based on the rural population in wealthy rural communities, where farmers, under the guidance of state policies, voluntarily join the program.

  • China’s rural pension system started in 1992, when the Basic Plan for Rural Pension at the County Level was promulgated.

  • The capital collection and accumulation follows the principle of “Most by personal contributions to be subsidized by the collective and supported by governmental policies”.

    • The farmer can take the pension when he reaches a certain age (normally 60).

    • the coverage of this kind rural pension is only limited to better-off areas where township enterprises are in good shape

The system, which is a guarantee of old people’s basic livelihood, helps change farmers’ traditional ideas, and is useful for promoting family planning, improving rural social security system, maintaining rural social stability, and for promoting the rural economy and social progress.

12 supporting system for the five guarantees

12 Supporting system for the five guarantees

  • The people should be considered belonging to the five guarantees if they are old or disabled or minors in rural areas:

    • Having no legal providers, or the providers are unable to provide for them

    • Unable to work

  • The five guarantees including:

    • The provision of grains, oil and fuel;

    • The provision of clothes, bedding, and pocket money;

    • the provision of basic living space;

    • timely medical treatment when ill, and some help when one cannot take care of oneself;

    • a proper funeral.

The supporting system for the five guarantees provides a means of basic living for the extremely poor.

13 new rural medical cooperative system

13New rural medical cooperative system

middle & west

  • The new rural medical cooperative system, a voluntary medical mutual assistance program financed by the individual, the collective and the government, aims to tackle serious illnesses contracted by farmers.

    • Each farmer should tender a fee of no less than RMB10 annually.;

    • The central government offers a subsidy of RMB10 to each farmer;

    • The local government also gives a corresponding subsidy of no less than RMB10 ;

    • The local government in the east should strive to make a RMB20 subsidy to the joining farmer .


Prof dr li xiao yun

  • The amount of subsidy under new rural medical cooperative system varies with the situations in different places

    • Between RMB100 and RMB500, 10% is reimbursed;

    • Between RMB501 and RMB1000, 15%;

    • Between RMB1001 and 3000, 20%;

    • Between RMB3001 and 5000, 25%;

    • Between 5001 and 10000, 30%;

    • Above 10001, 40%.

    • The annual accumulated amount for reimbursement must not go over RMB6000.

This arrangement gives back more in relative terms when one spends more. Therefore, it helps the patient avoid partial risks and burdens that come with serious illnesses.

14 the medical aid system for the poor

14 The medical aid system for the poor

  • The medical aid system for the poor also aims relieving peasants of their financial burdens by providing peasants with the basic medical service.

  • Main aid options:

    • Financial support should be given to people in helping them join the cooperative medical system.

    • If farmers are in great financial difficulty that their lives have been ruined as a result of serious illnesses, they are entitled to proper medical aid.

    • Farmers who have contracted special infectious diseases on the national government’s list are entitled to medical aid.

  • RMB300 million was granted by the central government to the benefit the 4.9 farmers in 2004.

Opinions of the Ministries of Civil Affairs, Public Health and Finance on the Implementation of the Rural Medical Aid System.

15 policies for assisting tramps and beggars

15 Policies for Assisting Tramps and Beggars

  • On July 21, 2003, the Ministry of Civil Affairs promulgated the detention and repatriation system that had been practiced for decades was then replaced by the aid system .

  • Tramps and beggars refer to those :people who cannot by themselves solve the problem of food and lodging, who have no relatives or friends to go to, and who are not entitled to the minimum-security benefits in the city or the benefits of the five guarantees, and who are now begging for a living.

  • The contents:supply basic food and accommodation, supply back fee,local government assure their basic needs of making life.

Rules for Aiding and Managing Tramps and Beggars with Secure Livelihood in the City.

16 the migration management policy reform

16 The migration management policy reform

  • Since reform and opening, with the continuous development of China’s economy, more and more people have been moving away from their registered places in search of better lives.

  • Statistics show that the total number of farmer workers stands at 150 million, and 80% of the total rural households have members working in the city as migrant farmers.

  • Though floating population has made contributions to the urban economy, they bring to the city lots of expected and tough problems in social safety, education of the children, family planning.

  • Thus, they are, on the one hand, the major builders of the city, while on the other hand, they are actually second-class citizens.

Prof dr li xiao yun

  • since 2003, the central government has made great adjustments in policies. The main contents of such policies are:

    • the abolition of the decades-long detention and repatriation system, and shifted emphasis on the protection of the legitimate rights and interests of migrant workers;

    • the equal treatment of migrant workers, repealing job restrictions against migrant workers, solving any delayed or unfair pay to migrant workers, and making possible the schooling of their children in the city;

    • improving the conditions for the transfer and employment of surplus rural labor, , gradually establishing a unified labor market for urban and rural people;

    • deepening the reform of permanent household registration, accelerating urbanization, and guiding the smooth and orderly transfer of surplus labor;

    • further improving management, doing a governmental service, highlighting the service function of governmental administration,

    • putting forth the guideline of “rational guiding”

Therefore, more need to be done in the protection of their rights and interests, and in identifying and meeting their needs in the daily population management and service.

1 pro poor micro policies for development2

1.Pro-poor micro-policies for development

1.3The Agricultural and Environmental Protection Policies

17 the comprehensive agricultural development program

17 The Comprehensive Agricultural Development Program

  • The Comprehensive Agricultural Development Program is a long term development plan established by the State to support and protect agriculture, to develop rural production and to enhance the comprehensive production capacity.

  • In 1988, the State Council established the Agricultural Development Foundation (later called the Comprehensive Agricultural Development Fund). Organized comprehensive agricultural development operations of large scale were carried out countrywide.

Prof dr li xiao yun

  • Main point:

    • In this program, fiscal, agricultural, forest, water conservancy, land and financial related government agencies were all engaged for comprehensive governance over mountain, water, farmland and road.

    • Funds from the Central government and local governments, credit capitals, self-raised funds and that from other sources were invested in.

    • Engineering, biological and technological measures were taken accordingly to achieve a combined economic, social and ecological effect.

  • At present, the project falls into two categories. One is about land governance. The other is about industrialization projects

18 the reform of fee and tax reduction and waiver

18 The reform of fee and tax reduction and waiver

  • In 2004, to boost up farmers’ initiative in producing more grains in the grain-producing areas, the provinces of Jilin and Heilongjiang took the lead in the reform of the reduction and exemption of fees and taxes.

  • The agricultural tax is exempted in 592 counties on the national list of poverty reduction in 2005, and pilot programs were started in some pastureland areas in an attempt to eliminate the animal husbandry tax.

Prof dr li xiao yun

  • Starting from 2006, China will completely eliminate the agricultural tax.

  • The national reform of agricultural fees and taxes will shift its focus to the supporting reforms of the rural and township organizations, rural compulsory education, and the county financial system in a bid to further lessen farmers’ burdens.

This reform considerably relieves the burdens of the farmers, enhances their risk-taking abilities and their initiative in agricultural production.

19 the policy of direct subsidies to grain

19 The Policy of Direct Subsidies to Grain

  • In 2003, direct subsidies to grain growers was a key item in that round of reforms of the grain circulating system. In 2004 direct grain subsidies was carried out in full swing nationwide, with priorities given to major grain-producing counties and farmers.

  • The operation plans of direct grain subsidies varied across regions.

    • In Shannxi province, the monetary standard for the 2004 grain subsidies was RMB0.033 for 500g of grains (regardless of varieties) multiplied by the five-year average quantity of grains purchased by the state. This method of calculation will remain in effect for three years.

    • The subsidies can also be based on taxed area alone (excluding the area for cash crops that could not be restored for grain production within half of a year and area for aquatic products).

Though the amount of direct subsidies was not much, it achieved the goal of stimulating farmers to grow more grains, reduced farmers’ burdens and increased their income

20 subsidies of the improved grain species

20 Subsidies of the Improved Grain Species

  • The subsidies of the improved grain species is a subsidy set up to encourage farmers to use improved grain species in their production so as to raise the qualities of agricultural products and to sharpen the competitive edge.

  • The state selected four varieties for the subsidies, namely, soybean, wheat, rice and corn. The better seed project is primarily implemented in the 13 grain-producing province.

  • in 2005, high-quality wheat with a subsidy of RMB10 per mu; for corn with RMB10 per mu;for high-oil soy with RMB10 per mu; for the early ripen rice with RMB10 per mu ,the middle ripen type RMB15 per mu and late ripen type RMB7 per mu.

the policy has played a positive part in boosting farmers enthusiasm for growing grains, with a profound influence on those impoverished peasants. The stability and security of grain production, and the maintaining and further improving of farmers’ income have become a major issue.

21 subsidies of the farm machinery

21 Subsidies of the Farm Machinery

  • The subsidies of the farm machinery aim at encouraging and supporting farmers’ utilization of advanced farming machinery so as to promote agricultural mechanization process, the comprehensive productivity of agriculture, better agricultural yields and efficiency, and the better return on an affordable investment.

  • The major kinds of machinery to be subsidized include:

    • Large and medium-sized power machines

    • Field operating machines

    • grain and agricultural by-products processing machines

    • Machines for processing stalks and grass.

  • The standard of subsidy is less than 30% of the farming machine price, and under RMB30,000 in amount.

poor cannot afford thus benefit directly from this policy, but the subsidy is conducive to push forward the agricultural development of those poor regions.

22 land conversion to forestry project

22 Land Conversion to Forestry Project

  • The 1998 flooding led to an overall reflection of the economic development approaches and the ecological functions of forests. It was against this backdrop that the policy of land conversion back to forestry came into being.

  • The land conversion to forestry project was launched in 1999, 2002 saw the full-scale campaign of land conversion to forests. By the end of 2003 the project covered more than 20,000 towns with over 100,000 villages and 60 million households. In 2004,changed the method of subsidization from grains to cash for the conversion of land to forest.

  • The government shall provide the land contractor with grain subsidies, a seedling allowance and a living allowance based on the actual acreage of the land that is converted into forests.

Prof dr li xiao yun

  • The specific standards are:

    • in the Yangtze River basin and south China, for each mu of reforested land the government offers 150kg of grains.

    • In the Yellow River basin and north China, for each mu of reforested land, the government offers 100kg of grains. For each mu of reforest land, the cash subsidy is RMB20.

  • the number of years in which the grain and cash subsidies can be given:

    • two years for the conversion of land to grassland

    • five years for land to cash forests

    • eight years for land to ecological forests

  • the government protects the owner’s right to the grass and forests of the converter. The contracting period of the converted land may be extended to 70 years.

The policy is also of great significance to the development of poverty-stricken areas, especially those places that are ecologically vulnerable. Impoverished peasants can invest their surplus labor into the betterment of family life in addition to the guaranteed grains obtained for the conversion of land to forestry.

23 land conversion to grassland

23 Land Conversion to Grassland

  • The project of land conversion to grassland refers to the building of fencing, the sowing of improved grass seeds, the banning of grazing, temporary banning of grazing, and grazing in different districts of the grassland, and all other measures designed to restore the grassland vegetation, to improve the grassland ecology, to increase the productivity of grassland so that the grassland ecology and animal husbandry can develop in coordination.

  • The project began in 2003. The plan was to implement the project in 11 provinces in the west in a period of five years.

Prof dr li xiao yun

  • The implementation of the policy of land conversion to forestry may place restraints on the grazing area and number of herds, which can negatively influence herdsmen’s income.

  • But from the long-term standpoint, with the restoration of the ecology and productivity of the grassland, the herdsmen not only benefit from generally restored environment, but from higher productivity from the restored grassland so that they have a much livelihood and personal development.

24 the compensation system for ecological benefit of forestry

24 The Compensation System for Ecological Benefit of Forestry

  • In 2001, the central government established the “fund for the compensation for ecological benefit of forestry". On Dec. 10, 2004 the compensation system for ecological benefit of forestry was formally implemented nationwide. From 2004 the government has allocated RMB2 billion each year on the 400 million mu forests for the compensation for ecological benefit of forestry.

  • That indicates that China has entered the stage of paid use of ecological benefits of forests from the previous unpaid stage.

Prof dr li xiao yun

  • The fund is set up to give subsidies to the managers and keepers of key public forest to supplement their expenditures for building, caring, protecting and management. The fund covers the forested areas, the sparsely forested areas that have experienced desertification and loss of water and soil, the areas with a mixture of bushes and woods, and the bush areas.

  • The standard for the compensation for the ecological benefits of national forests is RMB5 per mu each year, of which RMB4.5 is used for compensation, and the remaining RMB0.5 is used for public management and maintenance outlays such as the prevention of forest fires.

the compensation for the ecological benefits of national forests gives the new means of livelihood, which partially offset their losses stemming from the preservation of the forests.

25 natural forest protection project

25 Natural Forest Protection Project

  • in view of the fact that the ecological environment has been deteriorating due to the over-consumption of natural forests in China, the state launched the natural forest protection project so as to achieve the sustainable development of the economy and society.

  • The project’s objective was to solve the problem of the regeneration and restoration of China’s natural forests through the prohibition of tree felling in the natural forest and the drastic reduction of the output of commodity timber, and by resettling forest workers in a planned manner.

    • The project was formally brought into existence in October 2000, and is expected to last until 2010.

    • The major protective measures are the preservation and management of the forest resources. The subsidy is RMB10,000 for 5,700 mu of forestland taken care of by one person.

    • The project includes state-owned key forests in 734 counties and under 163 forestry-engineering bureaus in 17 provinces in the regions of the upper reaches of the Yangtze River, the middle and upper reaches of the Yellow River, Northeastern China and Inner Mongolia.

26the getting rich program of the ecological home

26The Getting-rich Program of the Ecological Home

  • The concept was initiated by the Ministry of Agriculture in 1999, aimed at generating farmers’ income and with the theme of ecological and environmental protection in the form of combining farmers’ living and production as an integrated whole.

  • This program were implemented on household basis, systematically integrated with renewable energy and efficiency ecological agriculture, and combined with reformations on rural toilets, stables, kitchens and yards

  • this program involve various projects of energy ecological models linked by marsh gas and accommodated with solar energy projects, coal and firewood saving projects and mini electricity projects according to practical need.

  • The expected goal is

    • to highly improve farmers’ living environment and realize positive economic and ecological circulation,

    • farmers’ energy efficiency for household use to reach more than 30%

    • rural population will have an average increase of 1000 RMB

27 environmental evaluation system

27 Environmental Evaluation System

  • “Environmental Evaluation Law of People’s Republic of China” was carried into effect in September 1st of 2003

  • Environmental evaluation system is a legal system, investigating, predicting and evaluating the projects and exploiting activities that are probably harmful to environment and proposing environmental evaluation and precaution scheme.

  • As required in the environmental protection law and the related regulations, an environmental evaluation report should be proposed to make a profound and specific evaluation on the pollution and environmental effect a constructive project will possibly bring out.

Prof dr li xiao yun

  • Environmental evaluation includes the following 6 aspects:

    • the basic situation of the constructive project;

    • the current environmental situation of the constructive project and its surroundings;

    • the analysis and prediction of the possible environmental effect on the surroundings;

    • the environmental protection measures and the economic and technical argumentation

    • the economic profit-loss analysis of the environmental effect;

    • the suggestions providing environmental supervision on the constructive projects;

    • a conclusion which includes: effect on environmental quality; construction scale and nature; whether the spot-choosing reasonable and pro-environment; whether the precautions economically reasonable and technically feasible; whether the further evaluation necessary, etc.

      The attack from environmental disasters is earthshaking to the already poverty-stricken people. So, a scientific reasonable and strict environmental evaluation policy is significant to the development of the poor.

1 pro poor micro policies for development3

1.Pro-poor micro-policies for development

1.4 The Land Policies

28 land contract system

28 Land Contract System

  • “Land Contract Law” was passed and put into effect in August 29th of 2002.

  • land contract in the rural areas should be in the form of family contract within the group economic organizations in the rural areas

  • The state protects the legal rights and benefits of the group land owners and their rights of contracting and managing the land free from any infringement form any individual or group. The state protects the legal voluntary and compensatory turn-over of the land contract and management rights.

  • In terms of land contract duration, the cultivated land 30 years; the grassland 30~50 years; the woodland 30~70 years .

  • The power in land contracting and operating can be contracted to the others, rented out, exchanged, transferred or turned over in the other ways. The contractor is the principle part of the power turnover in land contracting and operating.

The biggest difference lies in the fact that the legally acknowledges the turnover of land;the new land policy makes a long-term investment in land possible

29 basic farmland protection policy

29 Basic Farmland Protection Policy

  • Basic farmland refers to the cultivated land that is not allowed be occupied in accordance with the need of the agricultural products of the people and economic development in a certain period and the overall planning for land use.

  • The cultivated land that belongs to the protected basic farmland includes:

    • the cultivated land in the grain, cotton and oil production base ratified by the competent authority in State Department or the local county government or the higher level;

    • the cultivated with sound water conservancy control and water and soil conservation;

    • the farmland with medium or low output that can is being or can be transformed;

    • the vegetable base

    • the test farmland for agricultural research and teaching.

The carrying out of the national basic farmland protection policies secures the livelihood of the poor in some degree as well as maintains certain amount of land for grain yielding and ensures grain safety.

30 the compensation system for the resettlement

30 The Compensation System for the Resettlement

  • governments should take practical measures to compensate the peasants and maintain their living standard from decreasing due to the land requisition

  • The compensation includes soil compensation fees, resettlement allowance and compensation fees and the immature plants.

  • maintaining the peasants’ previous living standard and legally working out the unified annual output multiple 30.

  • The resettlement should be carried out by the following means:

    • Resettlement in agriculture.

    • Re-employment

    • Buying a share and sharing profit.

    • Resettlement in the other areas.

To the poor peasants without farmland, with the compensation maintaining their basic living level, they can put more labor resources and other resources into other sources of living, which is beneficial to their long-term development.

Prof dr li xiao yun

31The Compensation for the Resettlement caused by building the middle and large scale of water conservation and electricity projects

  • The Regulation stipulates that the compensation for using cultivated land will be three to four times the average annual productivity of the land three years before it is levied.

  • Each farming population shall get an resettlement subsidy two to three times the average annual productivity per mu three years before their farming land is levied

  • Emigrates shall be migrated within their local area and county. If not, they should be migrated to the beneficiary areas of the project. In case it is impossible to migrate them to the beneficiary area, then they shall be migrated away under the principle of economic reasonability.

  • The State will support the migration for five to 10 years

The policies, on the one hand, regulates the building performances of large and medium-sized water and hydro-power project, on the other hand, provides the farmers, especially those in poverty, a security for livelihood as well as long term development.

1 pro poor micro policies for development4

1.Pro-poor micro-policies for development

1.5 The Infrastructure Policies

32 the rural road construction the road to each village project

32 The Rural Road Construction (the Road-to-Each-Village Project)

  • All China’s Rural Road Construction Plan promulgated in August 2005 sets the overall goal of China’s rural road construction in the first 20 years of this century as follows: pitch roads will be available for towns and villages where conditions permit, composing rural road networks with high service level and facilitating farmers with easier, safer and more comfortable transportation.

  • The specific objectives for future rural road construction in the country’s rural road construction policies are:

    • By the year 2010, the country’s rural roads mileage will add up to 3.1 million kilometers. All the villages in eastern, middle and western China where conditions permit will be through with pitch (cement) roads (Tibetan area will be up to the construction situations).

    • By the year 2020, Towns and villages where conditions permit will be through with pitch (cement) roads. the total rural roads mileage will add up to 3.7 million kilometers.

Prof dr li xiao yun

  • More input from the State to the rural road constructions will highly improve the transportation conditions in mid and western China

  • especially areas in poverty in that huge investment will benefit local economic development, and meanwhile improve transportation conditions and reduce poverty in general sense.

  • The construction will also help the poor population in a long run by providing more sources of information and market resources.

33the rural broadcast and tv policies

33The Rural Broadcast and TV Policies

  • Since 1998, the National Broadcast and TV Bureau has endeavored to organize the Rural Broadcast and TV Program, which enabled all villages with electricity availability in the country to get access to broadcast and TV.

  • The construction were carried out in “four plus two” patterns, i.e., it will enable the audience within the coverage to access to four channels of TV and two channels of broadcast programs.

    • This policy requires that in 2004 to 2005, the program should cover 93923 villages countrywide, among which 1246 are administration villages newly availed with electricity and 92680 natural villages of more than 50 households that already with electricity.

    • Four TV channels include CCTV1, CCTV7, Children’s Channel and provincial channel

    • Two broadcast channels include Central People’s Broadcast 1 and provincial’s No.1 channel.

Prof dr li xiao yun

  • This policy and its implementation will no doubt help the farmers in poor areas to access to large amount of information and get rid of poverty.

  • In addition, the flow of information about the outside world will impact on ways of thinking and ways of life of these poor population, which, will be beneficial to their long term development as well.

34 the rural electrical network implement

34 The Rural Electrical Network Implement

  • The rural electricity network improvement starting from October 1998 invested 189.3 billion RMB as basic fund to transform and improve the rural electricity network.

  • The project required to carry on uniform administration for urban and rural low-voltage networks as per the principle of “same prices and two reforms” (institutional reform and electricity grid reform).

  • By the end of 2004 the rural electricity network had completed the basic improvement, with more than 90% coverage of transformation and overall equal prices for urban and rural areas and further reduction of rural electricity price.

the State’s huge investment has stimulated the macro economic development;the policy reduced the burdens of the rural people and increased the rural consumption of electric facility ; improved their capacity by attained more information outside

1 pro poor micro policies for development5

1.Pro-poor micro-policies for development

1.6 Policies Related to Family Planning

35 the household register system reform

35 The Household Register System Reform

  • The household register system is the produce of specific historical period and dual societal and economic background. As a product of history, this rigid system is no longer adaptable to and even hinders social and economic development, with the drastic social and economic transformations.

  • The system has undergone a course from loose to tight and back to loose again.

  • Not until recently did the provinces especially eastern provinces began to reform this system and to integrate rural and urban household register.

We can say the current household register system locked the desire, hands and feet of the poor, even their destiny.

36 the reward regulation for family planning households in the rural area

36 The Reward Regulation for Family Planning Households in the Rural Area

  • According to the family planning policy issued on February 27,2004, the State experimented this policy firstly in and throughout 9 provinces. From 2005, this reward program was spread to rural areas countrywide.

  • The reward system aims to encourage peasants to do family planning, so as to stabilize the bearing standards, and to develop the rural population and economic society harmoniously and sustainable.

  • For rural family with only one child or two girls, an annual pension of not less than 600 RMB will be granted to each over 60 years old either by the central or local government till death.

Prof dr li xiao yun

  • The policy has helped change farmers’ attitude towards family planning,

  • Has helped break the vicious cycle of “when one’s poor, he wants more kids; after he has more kids, he gets poorer.”

  • helps control the balance of the gender ratio

  • it is conducive to the solution of the old age problem and the establishment of the rural social security problem.

1 pro poor micro policies for development6

1.Pro-poor micro-policies for development

1.7 The fiscal Policies

37 financial policies supporting agricultural development

37 Financial policies supporting agricultural development

  • The major contents of the agricultural supportive fiscal polity system includes four aspects:

    • Direct fiscal input, i.e. government provides special capital to support agriculture.

    • Revenue support.

    • Price support. Through price adjustment, government increases the purchasing price of agricultural byproducts and reduces the selling price of the agricultural supportive industrial products to increase the income of farmers and reduce their expenses.

    • Financial support.

      The specific fiscal expense fee includes: agricultural infrastructure construction expense, three-project fee for agricultural technological development and social security in rural areas, fiscal subsidy on price and subsidy on purchasing price of agricultural produces.

38micro credit policies

38Micro-credit policies

  • Roughly, there are four types of micro-credit in China:

    • Non-governmental Organization projects

    • Foreign aid projects such as projects funded by UNDP and the World Bank

    • Government projects

    • projects directly operated by financial institutions

  • From January to June, 2003, 6.51 million rural households gained micro-credit loan, accounting for more than 60% of the total rural households loan requirements.

The original intention of micro-credit policy implementation was to help the poverty-stricken households gain lower risk credit support and to provide funding support for their further development and become rich.

2 urban pro poor micro development policies

2.Urban pro-poor micro development policies

2.1 Re-employment policies for the lay offs

39 re employment policies for the lay offs

39 Re-employment policies for the lay offs

  • “Two assurance”: to ensure that the basic living fee should be granted promptly and sufficiently and that the re-employment service center should be open to the lay offs.

  • The main contents of the re-employment policies:

    • The lay offs who find jobs by themselves can get settlement fee which is as three times as the average half-year salary of the local employees and should be paid totally without installments.

    • If the layoffs haven’t been re-employed, and have privilege to unemployment insurance treatment.

    • The layoffs and their family which is also in financial difficulty can enjoy minimal social security for urban-resident accordingly.

    • Pay medical insurance for the layoffs

40 special tax policies of the unemployed

40 Special tax policies of the unemployed

  • In September, 2002, National Bureau of Revenue consecutively released the related regulations which require:

    • For those layoffs who take up individual businesses, he/she needn’t turn in sales tax, city maintenance tax, additional education tax and personal income tax within three years.

      • Construction industry, entertainment industry and advertising industry, sauna, massage, net bar and aerobic bar excluded.

Prof dr li xiao yun

  • for new established service-oriented enterprises, if the laid off workers it recruited account for more than 3% of its total employees and signed labor contract with them with the term of more than three years, it will be exempted from collecting sales tax, city maintenance tax, additional education tax and enterprise income tax within three years.

    • Advertising industry, sauna, massage, net bar and aerobic bar excluded

Promote the re-employment

41 micro credit policies for the lay offs

41 Micro-credit policies for the lay offs

  • Any laid-off worker can apply for micro-credit loan by presenting re-employment preferential certificates checked and released by labor security sectors under the condition that the loan guarantee agencies provide guarantee for them.

  • The amount of micro-credit is usually about 20,000 yuan ,The time limit of the loan is usually less than two years, The extension period should be less than one year.

  • By the end of 2004, the balance of micro-credit guarantee loan released by financial institutions reached RMB1.8 billion. From the beginning of this program, totally there were more than 100,000 lay offs gaining support from micro-credit guarantee loan and re-employed.

Prof dr li xiao yun

  • The interest rate of micro-credit shouldn’t fluctuate upward. Micro-guarantee loan credit for mini-profit project was subsidized by central finance according to its real loss.

    • Mini-profit projects refer to the individual managed projects like commerce, restaurant and preparation run by lay offs in the place such as the community, street, mineral area.

Can support necessary credit for re-employment of the lay offs

42 inexpensive rent policies for the urban lowest income families

42 Inexpensive rent policies for the urban lowest income families

  • On March 1, 2003, the Administrative Pronouncement on Inexpensive Renting for Urban Lowest Income Families was enacted by the Ministry of Construction and other ministries.

  • Government and working units function as social security department in the area of housing and provide the urban lowest income families with inexpensive rent housing.

  • Based on the principle of meeting basic housing requirement, The security area shouldn’t surpass 60% of the average housing area of the local citizens in principle.

  • The specific subsidy measures differ from region to regions.

    • the rent subsidy should be no more than 40 yuan per square meter; The rent should be 5% of the total income of the lowest income families in Beijing.

43 the minimal social security system of the city residents

43 The minimal social security system of the city residents

  • In 1999, Statute about the Minimal Social Security of the Urban Residents was put into practice.

  • Responsible for the minimal social security system of the urban residents.

  • The minimal social security standards of the city residents.

  • according to necessary money needed to maintain the basic living such as clothing, food and housing and the money needed to buy water, electricity, coal or gas and to pay for compulsory education fees for minors was also taken into consideration.

    • The minimal social security standard of the city residents is 300 yuan per person per month in Beijing in 2004. The average nation-wide standard is 150yuan per person per month in the early 2002.

  • In 2001, 11.7 million people enjoyed the minimal social security and the number was increased to 19.31 millions in 2002 and 22.47 millions in 2003

Ensure the basic living for urban poor, and help them development in sustainable

44 pension insurance

44 Pension insurance

  • In 1995, the State Council enacted Decisions about Building the Uniform Basic Pension Insurance System for Employees of the Enterprises.

  • The ratio of basic pension insurance paid by the enterprises generally cannot surpass 20% of the overall amount of the enterprises’ salary (including the part goes to the personal account)

  • The basic pension insurance paid by individual shouldn’t be lower than 4% of his/her salary in 1997. It has been increased by 1% every two years since 1998 and finally reached 8%.

Prof dr li xiao yun

  • The individual account of basic pension insurance should be built for employees according to the amount of 11% of his/her charging salary. The insurance fee should be totally recorded into the individual account and the rest are paid by the enterprises. With the increase of the ratio of individual payment, the part paid by the enterprises should be decreased to 3%.

  • Until 2002, the basic pension insurance in China covers 147.36 million people. Among them, 111.28 million people are employees and 36.08 millions are the retired.

45 unemployment insurance

45 Unemployment insurance

  • In 1999, the state formally enacted and implemented Statute of Unemployment Insurance

  • Ensure the basic living of the lay offs during the period of unemployment and help them to be re-employed.

  • Include unemployment insurance premium paid by the enterprises and government agencies and schools and their employees; interest rate of the unemployment insurance funds; fiscal subsidy; other capitals legally classified as unemployment insurance funds.

  • urban enterprises and government agencies and schools should pay 2% of the total salary as unemployment insurance premium and their employees should pay 1% of their salary as unemployment insurance premium.

The policy provides livelihood security resources for the employees with the possibility of unemployment in the future.

46 medical insurance

46 Medical Insurance

  • In 1998, State Department issued “Establishing Basic Medical Insurance System of the Town Employees”

  • The main purpose of this reform was to accelerate the reform on medical treatment system so as to guarantee the basic medical treatment of the employees.

  • The agencies and employees should pay for the basic medical premium jointly. The ratio that the agencies take on should be about 6% of the total amount of the employee salary and the ratio that the employees have to afford usually accounts for 2% of their salary income.

47 work injured insurance

47 Work Injured Insurance

  • Work injured insurance is a social security system, providing compensation and help to laborers who suffer from the injuries and diseases at work and ensuring the instant medical treatment、living security、economic compensation and recovery of working ability

  • “Regulations on Insurance of Work Injured” was put into effect in 2004.

  • The fund of work injured insurance consists of premium of injuries at work, interests of the fund of work injured insurance and the other funds that are put into the fund of insurance of injuries at work according to the law.

Prof dr li xiao yun

  • The state determines the different premium rates by the injuries at work risk degrees in different trades and professions and decides a series of rate ranks within each trade according to the factors like the usage of premium and occurring rate of injuries at work.

  • the agencies pay the premium of injuries at work on time and the employees not pay for that. The amount is the salary of all the employees multiplying the rate of premium payment of the unit.

48 birth insurance

48 Birth Insurance

  • “Proposed Measures of Birth Insurance of the Enterprise Employees” was put into practice in 1995.

  • The main purpose is to maintain the legal right and benefit of the female employees in enterprises, to ensure their necessary economic compensation and medical treatment

  • the enterprises pay for the insurance premium to the social insurance agencies according to the certain proportion of their total sum of salaries to establish the bearing insurance fund. The individual employees do not pay for bearing insurance.

  • The maximum picking-up proportion of birth insurance premium can’t exceed the 1% of the total sum of salaries.

the policy is of great importance to the security of the special rights and benefits of the female employees. It’s also significant to the security of the rights and benefits of the poor employees.

49 accumulated fund for housing

49 Accumulated Fund for Housing

  • This policy is a compulsory long-term fund-reserve policy applied and developed in the town housing reform in our country.

  • In 1999, “Regulations on Accumulated Fund for Housing” was issued and put into practice.

  • it is the long-term reserve-fund for housing paid by the government departments, state-owned enterprises, town group enterprises, foreign enterprises, town free enterprises, other town enterprises and institutional entities (agencies for short) and their employees at work.

  • The amount of money they have to pay for the fund each month is monthly average salary in the previous year multiplying the proportion of the employee’s fund.

  • The accumulated fund for housing paid by the agencies each month is the employee’s monthly average salary in the previous year multiplying the proportion of the fund paid by the agencies.

3 pro poor macro policies

3.Pro-poor Macro-policies

50 west development policies

50 West development policies

  • Background

    • In the mid of the 1980’s, for the reason that the central government gave development priority to the coastal area, after ten years’ imbalanced development, the disparity between east and west were enlarged gradually.

    • By the end of 1990’s, along with the series of problems caused by the gradually expanded region disparity and the inequity of region development policies, the central government realized the economic, social and political importance of the west area enriched with affluent resources and large ethnic minorities.

    • In the second half year of 1999, in the purpose to reduce the disparity between the inland and the wealthy coastal area the west development policy was officially proposed.

Included provinces

Included provinces

  • Chongqing

  • Sichuan

  • Guizhou

  • Yunnan

  • Tibet

  • Shaanx

  • Gansu

  • Qinghai

  • Ningxia

  • Xingjiang

  • Inner Mongolia

  • Guangxi

The west region covering an area of 6.85 million square kilometers, 71% of the whole country and the population is 365 million, 29% of the whole country.

Important development field and way

Important development field and way

  • Implementation of west development includes measures of four domains:

    • infrastructure construction;

    • ecological protection;

    • adjustment of industrial structure;

    • development of science and technology , education and human resources.

  • The central government supported the development of west area mainly through preferential policies, financial support, enlarging input on infrastructure and environmental protection and so on.



  • The input on west development of the central financial construction fund amounted to 460 billion RMB ,The central financial transfer payment and special subsidy fund surpassed 500 billion RMB;

  • The state constructed 60 key projects in west area, with the investment approximately of 850 billion RMB

  • Road opened to traffic newly increased by 91000 kilometers. The newly built railway laid is 4066.5 kilometers

  • The total installed capacity of the construction of "west electricity delivers to the east" accumulated to 36 million kilowatts with the power transformer line of 13300 kilometers.

Prof dr li xiao yun

  • Within 2004 " west gas delivers to the east" has realized commercial air feed.

  • By the end of 2004, west area has completed 118 million Chinese acres of returning cultivated land to forestation and 170 million Chinese acres of afforestation on the barren land and hill, harnessing 190 million Chinese acres of seriously degenerated prairie.

  • In the year of 2004, increase of industrial fixed asset investment value and general local financial budget income respectively achieved or surpassed 20%.

  • The relative disparity of yearly average increase rate between west area and other areas of the nation had reduced to 0.8 % from 1.5% in the whole.

52 rebuild the northeastern industry bases

52 Rebuild the northeastern industry bases

  • Background

    • The state proposed to build a well-off society in an all-round way and the development thought of "interact from east to west, develop in coordination"

    • reduce the regional development imbalance in our country.

  • Executive principle

    • Bring forth the innovation of the system and the mechanism.

    • Adhere to the all-round consideration to realize the overall, coordinated and sustainable economic and social development in the old industrial base in the northeast.

Prof dr li xiao yun

  • Concrete methods

    • Firstly, implement the policy of exemption from agricultural tax in two provinces of Heilongjiang and Jilin and expand the scope and scale of grain production subsidy in the northeast area.

    • Secondly, in succession of Liaoning, experimental work on improving the city social security system had been brought forth in the two provinces of Heilongjiang and Jilin

    • Thirdly, according to the principle of "Highlight stress, arrange in priority, plan overall and implement dividedly", increase the support degree to the state-owned enterprises bankrupted by policy in the northeast area

    • had some enterprises drained of resources such as coal, non-ferrous metal mine and war industry enterprises withdrawn from the market steadily and the majority of staff had been properly arranged.

4 scientific development viewpoint

4、Scientific Development Viewpoint

Prof dr li xiao yun

Proposed time

  • The Third Plenary Session the Sixteenth Central Committee

    Particular content

  • a scientific viewpoint of an overall, coordinated and sustainable development, taking human in principle



  • Since the policy of reform and opening up, guided by the economic development direction "Development is the real truth", "Growth is all, all for growth", a kind of soaring developing process appeared, which only stressed growth but not development.

  • For the long run, this kind of plundering-like development strategy is unsustainable.

  • After entering into the new century, with gradually melting into the system of globalization and on the retrospect of the past development thought, our country gradually realized that pure economy growth does not represent the social economic development. This kind of growth regardless of equality and efficiency can possibly cause the development recede.

Emphasizing harmonious and equitable development

Emphasizing harmonious and equitable development

  • Being the weak group in social economic development, the poor are usually at the lowest status, having no basic say and always being neglected in social economic development, but at the same time, they are the first to bear the cost of social economic development.

  • Scientific development viewpoint emphasizes taking human in principle and the most important is to make allocation of development achievement impartial, which requests the specific development policy must take the benefit and request of the broad poor group into consideration.

5 macro control policy

5. Macro-control policy



  • Since the policy of reform and opening up, our country gave up the former planned economic mechanism in economic development pattern ,and switched to the pattern taking the market economic mechanism as the dominant player and the state macro-control as auxiliary measure.

  • Allocate resources by market law to maximize the benefit.

  • However, measures of market self-control sometimes may be out of order as well, and it must depend on the state macro-control to realize the steady development of the economy.

Basic concept

Basic concept

  • Macro-control is correspondent with the market economy, and it is the main method to regulate market by government.

  • In order to realize the macroscopic balanced and keep continual, stable and coordinated economic growth, the government regulates and controls in aspects of total revenue and expenditure of currency, finance and foreign exchange and supply and demand of strategic goods.

  • Government's macro-control is executed mainly through methods of economy, law and administration.

Prof dr li xiao yun

  • The economic method refers to the measures taken by government to influence and regulate social economic activities by using economic policy and plan and adjusting the economic benefit.

    • polices of finance, currency, price, economic plan(annual plan, five-year plan, ten-year plan etc.), helping the poor, tax, credit, interest rate, exchange rate, product buying and selling, industry and so on.

  • The legal method refers to the measures to regulate economic activity by using economic laws and regulations instituted by the state.

  • The Administrative method refers to the measures to regulate and administrate economy by using administrative order, instruction, index and regulations etc. taken by administrative organizations.

6 rural poverty alleviation policies

6. Rural poverty alleviation policies



  • By the early stage of this century, the absolute impoverished population in our country is basically maintained at about 30 million, relatively impoverished population is from 80 million to 100 million.

  • in 1987 our country instituted "Plan on the 1987’s National Helping the Poor and Tackling the Difficulty", requesting to basically eliminate the impoverished population in our country by the end of 20th century. The fact proved that this goal did not realize on schedule.

  • Grounded on this fact, our country continues to formulate "2001-2010 Essentials on Helping the Poor and Development in China Rural Area" in the purpose to continue to reduce the impoverished population in rural area and implement assisting policy to the impoverished rural area.

Prof dr li xiao yun

  • a kind of developing policy to helping the poor was adopted and applied a propelling pattern of the whole village to guarantee the realization of the effect in helping the poor.

  • the policy of helping the poor and development took the impoverished population whose dressing and food problem were not yet solved as the chief target.

  • Ethnic minority areas in the mid-west, revolutionary bases, border areas and poverty-stricken areas as the emphasis place to help and develop , establishing592 key supported counties .

  • continue to take the industry of planting and raising as the emphasis of helping and developing, further improve the basic production and living condition in impoverished area, intensify scientific and technical helping,

The capital sources for poverty alleviation activities

The capital sources for poverty alleviation activities

  • The first is the financial fund for helping the poor.

  • The second is the loan for helping the poor

  • The third is developing international exchange and cooperation in the field of helping the poor and development. .

Prof dr li xiao yun

Thank you!!

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