Thu, Sep 22, 2005 - Page 1 News List

Wealth gap in China becoming dangerously wide

AP , SHANGHAI

The gap between China's richest and poorest citizens is approaching a dangerous level and could lead to social unrest, state media reported yesterday, citing a government study.

The most affluent one-fifth of China's population earn 50 percent of total income, with the bottom one-fifth taking home only 4.7 percent, said the report by the official Xinhua News Agency, carried in newspapers yesterday.

"The income gap, which has exceeded reasonable limits, exhibits a further widening trend. If it continues this way for a long time, the phenomenon may give rise to various sorts of social instability," it said.

The reports reflect a growing public recognition of the simmering discontent that has provoked protests and sometimes violent clashes in disputes over labor, pollution and other issues. But apart from adjusting income taxes to reduce the burden on middle-income earners, there have been no signs the government plans to confront the problem with any major policy changes.

Attention has focused especially on mistreatment of migrant laborers from the countryside, in the wake of a case involving a construction worker who killed four people when he despaired about his pay.

Urban incomes in China now average about US$1,000 a year, while in the countryside incomes still average just over US$300. Other developing countries with income levels about that of China have tended to see "social contradictions" over time, the Xinhua report noted.

These days, the wealth gap is evident everywhere, from elderly citizens digging through downtown trash bins for plastic bottles to recycle to migrant shacks squeezed between luxury villas in Shanghai's suburbs.

Among the wealthiest are private business owners whose fortunes were built through hard work and talent, the Xinhua report said -- and those whose riches stem from corruption and crime.

Meanwhile, according to the China Poverty-Relief Fund, nearly 30 million Chinese live in absolute poverty, meaning that by local standards they lack enough food and clothing. Another 60 million have incomes below 865 yuan (about US$100) a year -- well below the US$1 a day that the World Bank takes as its standard.

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