Widening income gap 'inevitable' during transition
Premier Zhu Rongji yesterday struggled to explain why the Government had failed to stem the decline in rural incomes, arguing a widening income gap between rich and poor was 'inevitable' during an economic transition.
Quoting late leader Deng Xiaoping's saying 'some people should get rich first' - meaning those in coastal provinces should spearhead the country's market reforms - Mr Zhu acknowledged there were serious disparities in income and that many people had failed to reap the benefits of years of reforms.
'The widening gap between the rich and the poor does exist and this phenomenon seems inevitable in this period of time,' Mr Zhu said at a conference after the closing session of the 10-day National People's Congress. 'There are still disadvantaged and low-income groups. This problem is particularly serious among farmers,' he said, adding that extra help would be extended to retired cadres and the unemployed.
Referring to the issue of rural poverty as his biggest 'headache', Mr Zhu said civil servants' salaries doubled during the past four years and the Consumer Price Index had remained relatively stable; however, farmers' incomes had increased very slowly and, in remote provinces, had even dropped, he said.
'Due to excessive supply of grain and agricultural products, the price of this produce cannot go up,' Mr Zhu said. 'The price will decline further after massive amounts of imported produce from the US enter the China market, leading to more difficult lives for Chinese farmers.'
Mr Zhu acknowledged it was not easy to run a country of 1.3 billion people, but he vowed to continue rural reforms and restructuring of the agricultural sector to alleviate rural poverty.
'We may even distribute part of the grain reserve to help impoverished farmers turn farmland back to forest and grassland in a bid to control output, and reduce farmers' financial burden by cutting illegal fees and transforming lawful fees into taxes,' Mr Zhu said.
Leaders are wary of surging rural unrest as the bulk of the nation's rural population faces increased challenges with China's entry into the World Trade Organisation.
Rural protests against corrupt local officials, and clashes with rural cadres over oppressive arbitrary fees and taxation, have become common, often involving thousands of peasants.
