WB: China's national poverty line is higher than its new standard

Q: China and the World Bank have close cooperation in poverty reduction and related fields for over 30 years. How would you evaluate this relationship?

A: The World Bank has had the privilege to work with China for 35 years. The World Bank’s program has been based on an integrated cycle of analysis, project implementation, and continuous dialogue and feedback into policy process. The partnership has spanned a broad range of China’s development agenda and has included agriculture and rural development, infrastructure development, urban development, transport, education, health, environment and targeted poverty interventions.

I believe the success of the partnership has been that the Bank has been well attuned to China’s priorities and development program, and its lending program evolved with the country’s needs as they changed over time. A second ingredient for success is the long term nature of our engagement with China. The first project we financed in China signifies this very well: it was a project to upgrade the quality of China’s universities, in 1981. The reasoning behind this was that after the turbulent year that China had gone through it was critical to rebuild the universities that would educate the country’s future leaders—much in the spirit of Deng Xiao Ping who had called for emancipation of the minds of China’s people.

As for poverty, the World Bank assisted the Government of China in developing its national poverty reduction strategy through major studies on rural poverty including China: Reducing Poverty in the 1990s (1992), which recommended integrated multi-sectoral package of measures to assist the rural poor, and China: Overcoming Rural Poverty (2002), which recommended a greater focus on participation. A comprehensive Poverty Assessment From poor areas to poor people: China's evolving poverty reduction agenda was completed in 2008.

In collaboration with the State Council’s Leading Group of Poverty Alleviation and Development, the World Bank has supported six direct poverty reduction projects in China since 1995, namely, the Southwest Poverty Reduction Project (1995-2002); the Qinba Mountains Poverty Reduction (1997-2004); the Poor Rural Communities Development Project (2005-2011); the Sustainable Development in Poor Rural Areas Project (2010-2015); and the Poverty Alleviation and Agriculture-based Industry Pilot and Demonstration in Poor Areas Project (2015-2021). Through these project, the World Bank has sought to introduce global knowledge, good practices and innovations into China’s national poverty reduction program.

Q:Last month the new sustainable development goals were adopted by the UN summit. Under this new structure, do you think what kinds of adjustments of China and the World Bank should make to fulfill these ambitious targets? What kind of role will China play to realize the global targets?

A: At the United Nations General Assembly in New York that took place from 25-27 September, world leaders endorsed new Sustainable Development Goals, an ambitious agenda that aims to end poverty, promote prosperity, and to protect the environment. The first of these new goals is to eradicate extreme poverty by 2030.

Despite its great success with poverty reduction, China, on account of its large size, still has a vital role to play in reaching the global goal of eradicating poverty. China has an unmatched record of poverty reduction over the past three and a half decades, which other developing countries can learn much from. Indeed, President Xi Jinping led a forum on South-South learning, which was also attended by World Bank President Jim Kim. We believe that learning from China’s success will be an increasingly important ingredient of our partnership going forward.

In addition, developments in China, the world’s second-largest economy, and one that is increasingly open and market based, have a major bearing in the years ahead on both the regional as well as the global economy. So growth and poverty alleviation in other countries will in part be linked to China’s economic health.

The developing world’s infrastructure needs are large, with emerging markets and low-income countries facing an annual infrastructure spending gap of $1 trillion to 1.5 trillion, for which the China-led Asian Infrastructure Investment Bank (AIIB) and the New development Bank can play a very important role. With strong environment, labor and procurement standards, the AIIB and NDB can join other development banks in addressing these huge infrastructure needs that are critical to ending poverty, reducing inequalities, and boosting shared prosperity.

The World Bank will continue to work closely with China in these ambitious endeavors by bringing international knowledge and experiences to help China innovate and adapt international best practices to its own context and environment.