Learning From China’s Targeted Poverty Alleviation Strategy

Most countries on the African continent are in a permanent crisis of under development, slow development, and absolute poverty. But these problems are not unique to the African continent, other countries like China, south Korea, Singapore, Thailand, Malaysia, Indonesia, and many in South America have had similar problems but they managed to turn that train around. The case of East Asia has even been called an ‘economic miracle.’

28 percent of Ugandans are poor according to a Ministry of Finance report in 2021 and this rate had increased by 18% before the pandemic. There is reason to believe that the percentage of poor Ugandans could be even higher with some research putting the figure at about 41%. About two thirds of Ugandans had lost some income due to the covid-19 crisis according to the Finance Ministry.  Consequently, many Ugandans live below the official world bank poverty line of $1.90 per day.

To make matters worse, recent global events that have brought about a surge in fuel prices, record inflation, food shortage and dramatic rise in commodity prices coupled with the pandemic paint a dim picture for Africa at large. For example, a liter of petrol in Uganda has risen to between ugx 5000-6000 depending on the station in urban areas and it goes quite higher in rural areas. This year’s inflation rate in Uganda is estimated at around 6.1% from around 2.9% the previous year. To put it mildly; there is a mountain of work to be done to combat poverty.

But there is some good news. First, almost every country in the world is facing some sort of crisis right now whether political or economic. This is only good in the sense that we are not entirely alone. Second, one of the surest sources of strength for a country in the international community is to make powerful and resourceful allies. The good news is Africa has been doing just that by making China a strong partner and ally. So far, there is no reason to doubt China’s commitment to the long-term development of African countries guided by the principles of mutual benefit. Uganda has not been an exception in making a strong alliance with China and she can learn a lot about poverty alleviation from studying China’s strategy. Therefore, Ugandans and African have someone to look up to when designing their poverty eradication plans, a country like China has been where we are and beat the cycle of extreme poverty.

President Xi Jinping’s concept of Targeted Poverty Alleviation (TPA) has done miracles for China and has greatly contributed to the Communist Party’s century goal of comprehensively building a moderately prosperous society. The main target of this strategy is to solve the problem of poverty in rural China. The TPA can be likened to Uganda’s Poverty Eradication Action Plan (PEAP) but the TPA strategy has actually worked and Uganda should learn from it. The meat and bones of the TPA plan as stated in a march 2014 report by premier Li Keqiang involves local governments merging poverty alleviation resources and taking targeted measures to ensure assistance reaches poverty- stricken villages and households.

To tackle the problem of extreme poverty, Uganda’s leaders and policy makers need to understand the multidimensional nature of poverty and its various complex aspects. Poverty is characterized by numerous deprivations, including low consumption, poor health, shortened life span, poor living standards, limited access to education, knowledge, and information. Furthermore, poverty is a complex issue that involves aspects of sociology, geography, politics, and economics. People in extreme poverty also lack capital, specifically six types of capital: human, commercial, infrastructure, natural, public institution and intellectual.

China’s approach to poverty reduction has been based on two pillars according to a 2022 report on four decades of poverty reduction in China. The first was broad based economic transformation to open new economic opportunities and raise income. The other one was the recognition that targeted support was essential to alleviate persistent poverty; initially, support was given to areas handicapped by geography and lack of opportunities and then to households. TPA strategy is the sixth stage of new China’s poverty relief plan and is structured as a high-profile political campaign with prominent groups of the CCP on poverty alleviation established at every level of administration. China has long understood the problem of extreme poverty and has worked towards specific achievable goals to get where it is today.

Uganda needs to revise her poverty line like China did in 2015 by declaring that people with an annual income of less than 2800 RMB ($400 per year or $1,10 per day) were in absolute poverty. This has helped the Chinese government to focus on who to help. In the same year, the government of China initiated the ‘Decisions of the Central Committee of the CCP and the State Council on Winning the Battle of Poverty Eradication.’ The aim was to lift 70 million of the rural population above the poverty line until 2020. This meant lifting one million people per month and 30,000 people per day out of poverty.

One indicator of China’s seriousness towards eradicating poverty is the massive mobilization of resources and large parts of the political system as well as the private sector to achieve its poverty alleviation objectives. For instance, in 2019 the Chinese government allocated over 90billion RMB ($13billion) towards poverty alleviation and the China Development Bank pledged 400billion RMB (about $57billion) to combat poverty. Several other private companies like Alibaba gave funds for the initiative. In this aspect of mobilization, the government of Uganda has not been very effective especially when it comes to mobilizing the private sector to participate in poverty eradication programs in the rural areas.

China also adopted a national poverty registration system to identify the ‘real poor.’ This created a national data base where poor households (instead of county) are registered, their progress tracked and are dynamically managed. By 2019, the system had registered 128, 000 villages and 290,000 households. According to a 2022 world Bank press release; over the last 40 years, the number of people in China living below the poverty line has dropped by close to 800 million. The press release also points out that China has contributed to three-quarters of the global reduction in the number of people living in extreme poverty.

The approaches adopted by the TPA for China involved; peer partnerships among regions, cadres, and enterprises, focus on funding for businesses with local characteristics, relocation from areas that are not conducive for any kind of economic development to government planned communities, social empowerment with focus on skills training and construction of infrastructure. Uganda and Africa at large can learn from China’s experience and model their poverty eradication strategies to the TPA with their own national realities and contexts in mind.  From China’s experience developing countries can learn the significance of focusing on education, sustained public investment in infrastructure and adoption of structural policies supportive of competition.

It is therefore prudent that Leaders from Uganda and Africa study seriously the progress of China and other Asian tigers to fully grasp the how, when where and why of poverty eradication.

Moshi Israel is a Research Fellow at DWC.


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