Poverty in China

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Poverty in the People's Republic of China mainly refers to rural poverty. Decades of economic development has reduced urban extreme poverty.^[1][2][3] According to the World Bank, more than 850 million Chinese people have been lifted out of extreme poverty; China's poverty rate fell from 88 percent in 1981 to 0.7 percent in 2015, as measured by the percentage of people living on the equivalent of US$1.90 or less per day in 2011 purchasing price parity terms,^[4][5] which still stands in 2022.^[6][7][8]

The Chinese definition of extreme poverty is more stringent than that of the World Bank: earning less than $2.30 a day at purchasing power parity (PPP).^[9] Growth has fuelled a substantial increase in per-capita income lifting people out of extreme poverty. China's per capita income has increased fivefold between 1990 and 2000, from $200 to $1,000. Between 2000 and 2010, per capita income also rose at the same rate, from $1,000 to $5,000, moving China into the ranks of middle-income countries.^{[citation needed]}

Prior to the 1978 market reforms, poverty in China was already considered less severe than in over developing nations. According to one journal in 1981, “the poorest of China’s poor are better fed, better educated and healthier than the poorest in India and Pakistan, which makes these Chinese less poor.” Life expectancy in China, estimated by the World Bank at 64, was 3 years higher than the average for middle-income countries, while studies found that even before 1978 there was less malnutrition in China than other poor nations, while also having higher rates of literacy and school enrollment and a far lower rates of infant mortality.^[10]

Between 1990 and 2005, China's progress accounted for more than three-quarters of global poverty reduction and was largely responsible for the world reaching the UN millennium development target of dividing extreme poverty in half. This can be attributed to a combination of a rapidly expanding labor market, driven by a protracted period of economic growth, and a series of government transfers such as an urban subsidy, and the introduction of a rural pension.^[11] The World Bank Group said that the percentage of the population living below the international poverty line of $1.9 (2011 PPP) fell to 0.7 percent in 2015, and poverty line of $3.2 (2011 PPP) fell to 7% in 2015.^[4]

At the end of 2018, the number of people living below China's national poverty line of ¥2,300 (CNY) per year (in 2010 constant prices) was 16.6 million, equal to 1.7% of the population at the time. On November 23, 2020, China announced that it had eliminated absolute poverty nationwide by uplifting all of its citizens beyond its set ¥2,300 per year (in 2010 constant prices),^[12] or around ¥4,000 per year in 2020.^[13] The World Bank has different poverty lines for countries with different gross national income (GNI). With an GNI per capita of $10,610 in 2020,^[14] China is an upper middle-income country.^[15][16] The poverty line for an upper middle-income country is $5.5 per day at PPP.^[6][7][8][9] As of 2020, China has succeeded in eradicating absolute poverty,^[8][9][17] but not the poverty defined for upper middle-income countries which China belongs to.^[18][17] China still has around 13% of its population falling below this poverty line of $5.50 per day in 2020.^[9] In 2020, premier Li Keqiang, citing the National Bureau of Statistics (NBS) said that China still had 600 million people living with less than 1000 yuan ($140) a month, although an article from The Economist said that the methodology NBS used was flawed, stating that the figure took the combined income, which was then equally divided.^[19]