Building New Countryside Helps China to Cope with Challenges

Zang Min, a 43-year old beekeeper living in a small town of east China's agricultural province of Anhui, is worried about the future amid international anti-dumping measures

Usually, March is the start of busy year for beekeepers, but the 183 percent anti-dumping tariff on Chinese honey imposed by the United States has deprived the Chinese villager of happiness for harvest.

Zang has lived on honey exports for eight years. Before China entered the World Trade Organization, Zang earned an average income of 50,000 yuan (US$6,250) per year from 150 beehives.

"Now, the number of beehives has reduced to 100 because the more I keep the more losses I get under the unfavorable anti- dumping policy," the farmer said.

Last year, Zang couldn't even earn back what he expended in beekeeping. Hard work with little compensation could potentially turn Zang, as well as many farmers in similar situations, into an unstable element in Chinese society.

A huge poverty-stricken population in the rural areas still exists in some Asian countries that are experiencing booming economic development. Apart from the United States and European countries, developed nations in Asia like Japan and the Republic of Korea have also paid attention to the issue of extreme disparity between the rich and the poor with an aim to prevent social turbulence.

Kang Shaobang, vice director of the international strategy research center of the Party School of the CPC Central Committee, said the stability and harmony of the Chinese countryside is facing a series of pressures. "Without timely solution, the pressure will limit the nation's power to deal with changes in the world," Kang said.

On Sunday, in his annual work report to the nation, Chinese Premier Wen Jiabao set the building of a "new socialist countryside" as the first of the programs during the nation's 11th Five-Year Guidelines (2006-2010) period.

According to a recent report of the international economic cooperation organization, farmers in developed countries received abundant financial aid and subsidies as support for domestic agricultural production.

In European Union nations, the subsidies account for 34 percent of farmers' total income. In the United States, the figure stands at 20 percent. As to China's Asian neighboring countries, Japan and the ROK report even much higher figures of 58 and 64 percent, respectively.

The state subsidies of Chinese farmers only make up 6 percent of their total income, much lower than the developed countries.

In recent years, China's exports encountered the lots of anti-dumping measures in the world. Statistics show that over 90 percent of China's agricultural products have at some point been banned or levied high duties, causing billions of yuan in economic losses.

China is therefore making a concerted effort to maintain economic growth by spurring domestic consumption instead of depending on export trade and overseas investment.

China's dependence on foreign trade was as high as 60 percent in 2005, but domestic consumption only contributed 33 percent to the year's economic growth.

Lan Haitao, an expert from the Macroeconomics Research Academy under the State Development and Reform Commission, said the goal of building a socialist countryside can not be reached without significantly tapping consumption power in the rural area.

"The rural market is the stabilizer of China's economy in the future," he said.

Tang Min, chief economist with the Asian Development Bank's China office, echoed his view, saying the construction of a new countryside can help solve the problem.

In China's rural areas, where the population accounts for 72 percent of the country's total, the proportion of retail sales of consumer goods in the total sales of consumer goods dropped from 65.7 percent in 1980 to 32.9 percent in 2005.

Some experts believe economic development in China's rural areas will help lighten international trade disputes.

(Xinhua News Agency March 10, 2006)

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