The Chinese Communist Party is preparing to unveil a new five-year development blueprint which will mark a shift away from urban to rural spending priorities for the first time in 15 years. Much of the focus of the new blueprint is on raising living standards for the country’s 800 million peasants whose incomes have stagnated despite years of breakneck economic growth.

In the years through 2010, Beijing leaders hope to stimulate rural consumption and reduce the economy’s dependence on exports and high spending on urban infrastructure. To increase spending in China’s impoverished countryside is a policy of “epoch-making significance”, Premier Wen Jiabao said in his national address at the opening meeting of the congress last Sunday. “We must bolster our determination to reorient the government’s priority in infrastructure investment to the countryside. This is a major policy change,” Wen told the roughly 3,000 delegates attending the annual legislative session at the Great Hall of the People in Beijing.

Chinese peasants, who helped bring the Communists to power in 1949, enjoyed a dramatic lift in living standards after the 1979 rural reforms, which saw the people’s communes abolished and lift over 200 million out of poverty. But after the 1989 Tiananmen pro-democracy movement, which swept nearly 100 Chinese cities, the government has followed policies aimed at raising urban incomes and placating the grievances of China’s urbanites.

Annual incomes in rural areas average about 2,400 Chinese yuan, or 300 US dollars, compared with urban incomes averaging about 8,000 yuan. However, the actual difference in wealth between the country’s vast hinterland and cities is much bigger.

Based on a detailed study, the Chinese Academy of Social Sciences estimates that the average urban income is a whopping seven times that of rural areas. The widening gap between rural and urban dwellers continues to fuel unrest with record numbers of rural protests. According to the public security ministry, there were 87,000 public disturbances in 2005, a six per cent increase from 2004.

More than 40 million farmers have been displaced from their land and the number is increasing by more than two million a year. Landless farmers are now among the poorest people in the country and their desperate plight has sparked violent outbursts with sometimes tragic results. The programme calls for more spending on agricultural techniques, rural infrastructure and social services for the country’s rural residents.

The government has recently unveiled several additional policies aimed at boosting rural incomes. It has already abolished centuries-old rural taxes and also committed to subsidising farmers who grow grain. The elimination of agricultural taxes is expected to plunge local governments further in debt. Many county level administrations have debts, which are not included in the overall government debt statistics.

Reflecting a heightened sense of urgency to relieve the burden of rural families,

rural health care and rural education are two of the biggest causes of local government deficits. Critics say the real test of the government’s commitment to helping the rural poor lies in Beijing’s willingness to go a step further and allow privatisation of farmland. — IPS