REMARKS BY RENATA LOK-DESSALLIEN TO The International Workshop On Challenges and Response to Poverty Reduction in China’s New Development Stage

Feb 28, 2011

25 February, 2011, Fraternal Hotel, Beijing

Dear Vice Minister Zheng Wenkai, Excellencies, Ladies and Gentlemen,

On behalf of the United Nations Development Programme, I am very honored to welcome all of you to this international workshop on Challenges and Response to Poverty Reduction in China’s New Development Stage.  We are very pleased to have with us friends and colleagues from the Government, UN agencies, academia and NGOs.

The topics of the workshop are central to the mandate of the United Nations to achieve the MDGs, and to forge development pathways that are equitable, sustainable, and people-centred. We therefore attach great importance to this workshop.  And it comes at an auspicious moment in time.

The year 2011 marks the beginning of China’s new ten-year poverty reduction strategy, the beginning of the last decade for achieving an all-round Xiaokang society by 2020, the start of the 12th Five Year Plan, and the 5-year home stretch for the Millenium Development Goals.  It is, thus, a significant juncture.  One in which course adjustments, where needed, are critical to the realization of our goals.

UNDP has consistently been among China’s loudest and most enthusiastic congratulators when it comes to poverty reduction.  We have praised the government’s outstanding performance in this arena time and again. And rightly so, as the achievements have been beyond our rosiest expectations.  That being said, I feel that rather than repeating our sincere praise for past achievements, it would be more useful and pertinent for me in the context of today’s workshop to say a few words about the challenges ahead. While there are many, I would like to highlight seven, very briefly.

Firstly, it will undoubtedly be more difficult for China to reduce poverty in the years ahead than it was in years past. The low hanging fruits have already been plucked.  The quick wins have mostly been won.  And what remains are largely the more difficult cases. In rural areas, for example, the effort must address the large number of female headed households, whose husbands and sons have migrated to industrial and urban centres for work and in whose care lies the fate of both the older and younger generations.  In urban areas, the strategy must address the rising number of vulnerable populations, particularly migrant workers.  As urbanization rises fast, so will urban poverty if measures are not taken to integrate these groups quickly into the urban economies and social service systems.

Secondly, while China has been successful in pulling millions of people out of poverty, there are many transient poor households who hover at the brink, and frequently fall in and out of poverty.  The transient poor are particularly vulnerable to shocks.  The new 10 year poverty reduction strategy will need to address this group – in both rural and urban contexts. 

Thirdly, poverty is more difficult to reduce when inequalities are high, as in China.  Furthermore, once inequalities reach a certain level, as they have in China, the significance of reducing the absolute number of poor people can be clouded by the rise in relative poverty.  So, the new ten year poverty reduction strategy must tackle the issue of rising inequalities head on.  In many ways, this is much more difficult than reducing absolute poverty because of entrenched interest groups.

Fourthly, the new ten year poverty reduction strategy (2011- 2020), corresponds to a significant shift in the growth model – from largely export oriented to more consumption based.  The poverty reducing strategies pursued under the former may not be fully relevant to the latter. It is therefore extremely important that the macroeconomic framework be reviewed in this context to enhance its poverty and inequality reducing characteristics. Without a poverty reducing macroeconomic framework, all other pro-poor measures become both inefficient and inadequate.   

Fifthly, just as meaningful poverty reduction cannot be achieved without addressing the macroeconomic framework as a whole, neither can it be fully successful without addressing governance.  There are many aspects of this, but let me flag just two at this time – the interface between central and local governments, and the interface between public services and civil society organizations and community groups (what is termed “social management” in China).

Sixthly, many of China’s poor areas are highly sensitive to climate change.  Helping poor residents in these areas to adapt their livelihoods and living conditions to climate change must become a priority area for the new poverty reduction strategy.

And finally a favourite theme of UNDP world wide -- we must get over the global fetish with income as the central measure of human progress and, conversely, of poverty.  Income poverty measures such as per capita income and poverty gap indices are fine and good, but they only tell us part of the bigger story.  To meaningfully reduce poverty, we must preoccupy ourselves with that bigger story of human poverty.  To do that requires a broader set of multidimensional poverty measures.  Only with a more sophisticated and balanced measurement system, can we hope to identify the policy measures required to adequately and fully address the challenge of reducing poverty and, hopefully, eventually eradicating it altogether.

Distinguished colleagues and friends,   

The findings of the reports which will be presented today are the result of a joint effort over the last one and half years involving the IPRCC and LGOP, a high caliber research team, and a senior advisory group of scholars and practitioners. I would like to use this opportunity to express my sincerest appreciation to all the distinguished colleagues of IPRCC and members of the consultant team, for your dedicated efforts and contribution to this most important endeavour. I also want to express my heart-felt gratitude to LGOP, led by Vice Minister Zheng Wen Kai, for the invaluable strategic guidance and support to this initiative. 

We hope these policy findings may be useful for those charged with finalizing and implementing the new 10 year poverty reduction strategy. I wish this workshop great success. Thank you very much.