A foreigner visiting China for the first time often feels like the country mouse from Aesop’s Fables. The cities look like huge science fiction sets－stunning even compared to New York. The subways are clean and run on time. High-speed rail covers the nation and the airports are among the best in the world. Ports and freight infrastructure are much higher quality than in many rich countries.
Just a decade ago, this kind of modernity was concentrated mostly in the richer eastern Chinese provinces, but now many inland and western cities are dazzling. I’ve seen Changsha in Hunan province, Chengdu in Sichuan, and Kunming in Yunnan－all have great infrastructure and look like good places to live.
Even foreigners residing in China often live and work in an environment that is at least on a par with highly developed countries. Unlike most of our home countries, everything seems to just work in China. Transport is convenient; shopping online and delivery services are much better than any other country; electronic payments and other high-tech services are highly convenient.
In many ways, China looks like the future. Superficially, China seems to be not only a developed country, but maybe the most developed country.
But, not so fast. China has developed rapidly over the last 40 years, raising hundreds of millions of people out of poverty. But, there’s still a long way to go.
Even in the very poorest areas, China has developed far beyond Deng Xiaoping’s goal of ensuring that every family would be able to afford a bicycle, a radio, a wristwatch, and a sewing machine. The efficiency of China’s factories has made these, or their modern equivalents, affordable not only in China, but also in the poorest countries in the world. Most importantly, almost everyone in China’s villages has enough to eat. And, life expectancy has reached 77 years, just a few years behind the most long-lived countries.
Despite rapid progress, the numbers show that most of China’s people are still far from rich.
The country is at the cusp of eliminating extreme poverty, which is defined as living off less than $2 per day. That’s a huge accomplishment, but extreme poverty is a very low standard. Still, about 60 percent of China’s people live off less than $10 per day and almost 90 percent live off less than $20 per day. This compares to South Korea or Japan where less than 20 percent of people live off less than $20 per day.
In terms of GDP per capita, adjusted for purchasing power parity, China ranks about 70th in the world－below many clearly developing countries in Latin America (Chile, Mexico, Argentina) and Asia (Turkey, Iran, Thailand).
More than 1 billion people in China are no longer extremely poor by international standards. But, for them to be able to use their abilities, to live better lives, to pursue happiness, the country needs to continue to grow rapidly. It has to be able to continue to build up its business, scientific and technical capabilities. This is true for the cities as well as the rural areas.
I’ve had the opportunity to spend a lot of time in Yunnan province, which is often portrayed as a prototypical poor, inland province. At first glance, Kunming, the capital, and Yuxi, my wife’s hometown, don’t seem poor at all. The infrastructure seems better than we have in the United States. But, salaries are low and young people say they don’t have sufficient job opportunities. Programs such as the Belt and Road Initiative are needed to help them reach their potential.
In rural mountainous areas, the problems are different. I had the opportunity to visit Hebian, a Yao minority village near the border with Laos. Less than 10 years ago, Hebian was isolated and very poor. Its people were largely subsistence farmers, who sometimes didn’t have enough to eat. Their only connection to the outside world was a long dirt road. Now, the government has paved the road and, working with a team of development experts from China Agricultural University in Beijing, the villagers have built very beautiful new houses. But they still need continuing assistance. Further development is crucial if they are to work their way out of poverty.
A primary goal of China’s leadership is to establish a moderately prosperous society for all the people. To do this, the country needs to continue to develop rapidly so that it can overcome three major challenges－building out education and healthcare for the entire nation, continuing development of livable, sustainable cities and creating greater opportunities in small cities, towns and rural areas.
The educational opportunities that Chinese parents in the big cities give their children amaze foreign visitors. It’s easy to be impressed by the diligent and well-educated students in the nation’s universities. But, despite great efforts to spread educational opportunities throughout the country, more time will be needed to raise rural levels up to the city standards.
The Rural Education Action Program of Stanford University, working with China’s Ministry of Education and many universities throughout China, has conducted in-depth surveys and experiments examining the level of education and health in rural areas. According to these studies, in 2013, only about 40 percent of children in poor rural areas graduated from high school.
This regional educational inequality is, of course, not unique to China. Unfortunately, many inner-city schools and some rural schools in the US are abysmal. For example, the Baltimore Sun newspaper reported that in the fourth and eighth grades of the city’s schools, only about 13 percent were tested as proficient at reading or math.
Scott Rozelle, co-director of the Stanford program, notes that China has constructed excellent school buildings and that teacher pay and qualifications have gone up in recent years, but it takes a long time to turn around educational problems. Even the poorest Chinese parents have high educational aspirations for their children. Studies in poor provinces found that large numbers of children were being held back by health problems that began in infancy. Rozelle argues that China will not be able to escape the “middle-income trap” until it is able to raise the health and education standards of these millions of children－who will become the next generation workforce.
There is no official international definition of what constitutes a developing country. In the World Trade Organization, such relatively rich countries as Singapore, Israel, and South Korea define themselves as developing.
Why does it matter? Two primary goals for Chinese decision-makers are to escape the middle-income trap and to raise the 580 million rural citizens to prosperity. To have the resources to reach these goals, China needs to be able to continue to grow rapidly.
As the world population continues to soar, we will have to find ways for large numbers of people to live good lives on limited resources. The high consumption lifestyles in the US, Europe and other currently rich countries are certainly not sustainable for the whole world.
On the other hand, China is working to build cities that are comfortable and livable, even for people who make less money. China has found ways to feed its 1.4 billion people but needs to continue to improve the life opportunities for people in rural areas. The success of this model is crucial not only for China, but for the world.