Mon, May 12, 2008 - Page 11 News List

FEATURE: Shanghai’s poor struggle to live as inflation rises


Lu Bingzhou, a resident of China’s glitziest and wealthiest city was once a successful architect but personal tragedy and bad luck have meant he now picks garbage for a living.

As rising inflation has swept through Chinese society since last year, Lu’s fall from middle class prosperity to dire poverty has only deepened as the former graduate of elite Tongji University struggles to make ends meet.

Food, rent and business costs have skyrocketed throughout China, but perhaps nowhere is the impact of those prices being felt more keenly than in Shanghai, which for years had been the nation’s most expensive city.

For Lu, 59, blind in one eye and losing his sight in the other, the jump in the price of basic food staples, such as rice, pork and cooking oil, has meant forced dieting for him and his wife.

“Since two years ago it seems that everything has become expensive,” Lu said, as he lugged two bags full of empty plastic bottles in one of the city’s wealthiest neighborhoods, papered with billboard ads for luxury goods.


“The most expensive is pork and if we don’t have money we don’t buy it. Since this year’s Lunar holiday in February we have not bought any meat,” said Lu, his soiled and rumpled clothes hanging on his bent and bony frame.

Food prices, the main factor behind a recent spike in inflation, have hit a worrisome 12-year high that has spurred the government to freeze prices of key consumer items.

Items covered by price controls — intended to contain inflation and keep basic necessities affordable for most families — include grain, cooking oil, meat, milk and liquefied petroleum gas.

Inflation has in the past fuelled unrest in China — as happened when public anger boiled over into protests that lead to the 1989 democracy movement, which was eventually brutally crushed by the military.

Food prices too have emerged as one of the biggest global economic concerns this year, with the IMF and the World Bank warning of the dangers this trend could have on political stability in developing nations.


Eager to avoid such a scenario, especially ahead of the Olympic Games in Beijing in August, the Chinese Communist Party has repeatedly promised to control inflation and said that they have stockpiled enough grain to maintain price stability.

But while prices may have stopped going up as sharply — in March inflation eased slightly to 8.3 percent after reaching 8.7 percent in February — it is still little comfort for Lu as he rummages through dustbins to eke out a living.

“I don’t want to trouble other people by begging, so I rely on myself to earn money,” said Lu, who makes about 40 yuan (US$7.14) a day picking through rubbish eight hours a day.

Lu receives an additional 960 yuan in monthly sick pay, plus the 1,000 yuan his wife earns, bringing his total earnings to just a little more than the official average salary in Shanghai last year of 2,900 yuan a month.

The money is enough to cover most basic needs without any frills as well as pay the 3,000-yuan mortgage on two apartments that Lu bought for himself and his wife as well as his two college student sons when he was still flush.


Apart from the blindness caused by chronic deterioration of the retina that ended his career prematurely 16 years ago, in 1998 Lu decided to invest in real estate in Zhengzhou, Henan Province.

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