Dean of the College of Humanities and Development
at China Agricultural University 
Li Xiaoyun

Speech at the China Forum for Poverty Alleviation and Development
Distinguished Mrs. Gu Xiulian, Mr. Liu Jian, Guests, Ladies and Gentlemen：
Good morning.
        My topic for today is the challenges ahead in constructing socialist new villages. I will cover the following three aspects: first, the number of the poor in rural areas; second, the benefit that the poor can get from current policies; third, the way out. 
        Chinese official statistics show that the absolute poor amount to 26 million and the low income amount to 6 million. However, our recent survey on 500 villages confirmed the result of the previous survey we did on 100 villages that is, the number of the poor is significantly underestimated by the Chinese government. Our 100 village survey told us the poverty incidence ranges between 35% and 89%, while the 500 village survey concluded a rate of 30%. The Shanghai Global Conference last year and today’s conference both showcase the achievements China made over the past two decades. Each of the Chinese people benefit from the achievements and are proud of the progress. Yesterday the New Worldbank President also praised China for its record in poverty reduction. But what I want to remind you is the figures that reflect rural poor in China. The Worldbank estimate is 200 million and our version is between 7 million and 140 million, both of which look much different from the Chinese official statistics. 
        How do the poor survive? Analysis on demographic composition of poor revealed that, 23% of the poor are semi-literate or illiterate, over 50% are plagued by diseases, over 70% poor households have no access to medical care and only 3% poor households in rural area have sanitary toilets at home, which are alarming compared with municipal cities like Dalian and Shanghai . The figures do not end here. 8% of the rural residents live in concrete houses, that means 90% of them live in thatched houses. 70% of them burn firewood for cooking. And as the financial figures are consolidated, we come up with a conclusion that the household cash deposit in poor rural areas is -557 RMB, which means they are in debt. Only 6% of them received loans. They have neither deposit, nor loan but only debt. Only 5% of rural poor enjoy commercial insurance, 11% of them enjoy cooperative medical care. In a word, these figures highlight the extreme vulnerability of the poor in human capital, fixed capital, financial capital and social capital. The vulnerability leads to tragic lives of the rural poor and the risk to return to poverty. 
        Let’s take a look at the current progress in poverty reduction. There are more than 20 of our current policies are related to financial input to the rural areas. For example, agricultural distance training, job-seeking trainings for new farmers, trainings for the green certificates, energy construction in villages, labor transfer and cooperative medication, etc. The latest research revealed that, only 12% of the poor villages can benefit from labor transfer programs. 19% of them have access to cooperative medical care. 11% of them have access to rural energy construction. And only 1% or 2% of them have access to agricultural distance trainings. Although the poverty reduction offices at various levels did try their best, the poor remaining bereft of these benefits is still a large number. I regard it a big challenge if we target rural poor in the construction of new villages. 
        In comparison, poverty reduction experienced a turning point at the herald of the new century. The average people highly regard the poverty reduction which never happened before. Especially in recent years, we witnessed a huge progress in developing village-based strategies. The focus shifts from region-based to village-based poverty reduction, resulting in the enhanced financial attainment to villages at over 70%. My suggestion is that, we must keep cool even facing the great progress. 
        Now I am going to address my last point. First, the current mode of economic growth can not lead the benefit to the poor. We have relied on foreign trade to an excessive extent, that is why we conflict with the US and EU from time to time. The time has passed when the poor occupied the central position of government agenda. During the early and mid 1980s, each bit of economic growth would translate to corresponding bit of benefit to the rural population. It was a natural process that the development of township enterprise and labor transfer improved agricultural products and increased income for farmers. Surplus money rose and expenditure rose. At that time, China was abundant in large amounts of surplus and cheap labor force and practical technologies. That was a period when the economy was developing in a soundest way. China’s poverty reduction achievements in today should be attributed rather to that period of development. Starting from the mid of the 1990s, Chinese economy was featured by high capital intense, high technology intense and high energy intense, a structure that denied Chinese economic and social reality. The result is growth does not benefit the poor, does not benefit the majority of the rural residents. My point is that, the redistribution of wealth among a population as big as 600 million to 700 million can not work to ensure welfare for all. What would work is to change the mode of economic grow in favor of the majority rather than the minority. This is the key to the problem. Without addressing the problem, we can see no bright side in constructing a socialist harmonious society. Additionally, poverty reduction should go beyond providing the poor with pigs and chickens for them to survive on and to be trapped in this level of livelihoods. Poverty reduction should be expanded to the construction of new villages. So I believe it will prove as a useful combination between poverty reduction and the construction of new villages.
　　Thank you!