By the time Xi Jinping assumed leadership, China had already largely overcome poverty for the majority of its population, but poverty persisted in certain regions, necessitating new approaches from the country’s leadership. The most affected areas were remote mountainous and desert regions far from the coast, characterized by a harsh continental climate. Given China’s export-oriented economy and the cost-effectiveness of sea transport for international trade, it is unsurprising that capital was concentrated in coastal provinces such as Guangdong, Shandong, Zhejiang, Fujian, and Shanghai.
Definition of Poverty: An annual income below 2,300 yuan (approximately $340 at the 2010 exchange rate or $659 in purchasing power parity) [1]. In 2010, the World Bank officially defined poverty as an annual income of $456. Thus, it is important to distinguish between extreme poverty and poverty in general. In 2012, nearly 100 million rural Chinese residents lived below the poverty line.
At the start of his leadership, Xi Jinping introduced the concept of “Targeted Poverty Alleviation” (精准扶贫) [2], which was based on five principles:
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Precise identification of the poor, i.e., determining who exactly is poor;
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Targeted support;
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Efficient allocation of funds;
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Individualized approaches;
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Appointment of responsible officials to oversee reforms locally.
A dedicated poverty alleviation group was established under the State Council of the PRC, led by a vice-premier. This group coordinated the efforts of ministries and agencies. Local party committee leaders were held personally accountable for meeting specific targets. An electronic database was created to monitor each poor household. Starting in 2014, over three million officials and party members were sent on assignments to remote areas for periods ranging from one to three years. They studied local conditions, developed development plans, and oversaw the implementation of reforms on the ground.
To achieve these goals, door-to-door surveys were conducted, and digital dossiers were created for each poor household. Hundreds of thousands of “first secretaries” worked in tens of thousands of villages across the country. In addition to income data, officials collected information on the health, education level, skills, land ownership, and assets of poor families to better understand the likely causes of poverty. Each dossier in the electronic database was regularly updated to track progress.
Five main causes of poverty were identified:
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Lack of work skills and education;
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Lack of land or capital;
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Residence in economically depressed areas;
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Illness or disability;
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Belonging to an ethnic minority, often accompanied by a language barrier.
To address these causes, the government implemented the “Five Channels” (五大扶贫方式) policy [2]:
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Relocation (易地扶贫搬迁) from depressed areas where improving welfare on-site was impractical (nearly 10 million people were relocated to urban agglomerations with job opportunities);
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“Giving fishing rods, not fish” (产业扶贫), i.e., establishing cooperatives, promoting e-commerce, and developing tourism instead of simply providing financial aid;
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Education (教育扶贫) (providing scholarships, subsidies, free meals, housing, and university admission quotas for children from poor families at all education levels);
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Activities reminiscent of U.S. President Franklin Roosevelt’s “New Deal,” such as involving the poor in large-scale infrastructure projects like tree planting (生态扶贫);
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Pensions, subsidies, and healthcare for those unable to work (the elderly, sick, or lone individuals with disabilities) (社会保障兜底).
This initiative was generously funded from the central budget, with approximately 600 billion yuan allocated. Three million officials and party members were involved in implementing the reform. Additionally, the “East-West Partnership” (东西部协作) was notable, whereby wealthier eastern provinces (Guangdong, Shanghai, Jiangsu) assisted poorer western provinces.
The main achievement of the reform was the elimination of “absolute poverty,” defined as raising living standards above $1.90 per person per day, according to World Bank calculations:
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2012: 98.99 million people [3];
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2014: 70.17 million;
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2017: 30.46 million;
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2019: 5.51 million;
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2020: Absolute poverty declared eliminated.
The average annual income of the poor rose from 6,989 yuan in 2013 to 12,588 yuan in 2020, representing an average annual welfare increase of 11.6%.
Indirect indicators of the government’s success in poverty alleviation include infrastructure improvements: 2.5 million kilometers of roads were built, safe drinking water was provided to 18.8 million households, and electrification and internet access were expanded. Ninety-nine percent of the population now has access to healthcare. Targeted scholarships have virtually eliminated situations where children dropped out of school due to poverty and the need to work.
UN Secretary-General António Guterres has praised China’s poverty reduction efforts [4]. China accounted for 70% of global poverty reduction under the Millennium Development Goals and later the Sustainable Development Goals (SDGs). The country achieved its extreme poverty reduction target 10 years ahead of schedule. The World Bank noted that the pace of China’s poverty reduction is “unprecedented in world history.” This success rests on three pillars: a targeted approach, massive infrastructure investments, and strong political will.
It is worth noting that the “one family, one child” policy was also aimed at poverty reduction. However, given the declining birth rate and concerns about an aging population, in 2021, the government announced the “Comprehensive Rural Revitalization” (乡村振兴) strategy to prevent excessive urbanization. Studies show that rural women, on average, have more children than urban women. Thus, after initially addressing extreme poverty partly through relocating rural residents to suburbs and providing factory jobs, the government is now considering partially reversing this process, leveraging new infrastructure. Monitoring of vulnerable families continues, as illness of a breadwinner can once again put a family at risk.
Challenges and consequences of the reform: Local government debts due to poverty alleviation investments and the persistent urban-rural wealth gap.
Through this policy, the government also strengthens its legitimacy and social contract, demonstrating the realization of the “Chinese Dream” and the “great rejuvenation of the Chinese nation” as a stepping stone toward the next goal—building a “modern socialist state.” China has showcased the benefits of a mobilization-driven development model, national priorities, a combination of planned and market mechanisms, digitalization, and effective personnel policies.
Andrey Timchenko
References
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China Power Project. Is China Succeeding at Eradicating Poverty? [Online] // ChinaPower. Center for Strategic and International Studies (CSIS). – URL: https://chinapower.csis.org/poverty/ (accessed: 19.09.2025).
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Central Committee of the CPC, State Council of the PRC. Decision on Winning the Fight Against Poverty [Online] // People’s Republic of China, Official Government Portal. – 2015. – URL: https://www.gov.cn/zhengce/2015-12/07/content_5020963.htm (accessed: 19.09.2025).
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State Council of the PRC. Information Office of the People’s Republic of China. Poverty Alleviation: China’s Experience and Contribution [Online] // Foreign Languages Press. – Beijing: Foreign Languages Press Co. Ltd., 2021. – 69 p. – ISBN 978-7-119-12645-6. – URL: http://www.xinhuanet.com/english/download/2021-4-6/FullText.pdf (accessed: 19.09.2025).
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Guterres, A. Statement by the UN Secretary-General on the 50th Anniversary of General Assembly Resolution 2758 [Online] // UN Press Center. – 2021. – URL: https://press.un.org/en/2021/sgsm20988.doc.htm (accessed: 19.09.2025).
