November 01, 2017
A NYT article reported on a commitment by its president, Xi Jinping, to raise everyone in China above its official poverty level of 95 cents a day by 2020. According to the piece, 43 million people in China now fall under this income level.
While the piece implies this would be a difficult target for China to make, the cost would actually be quite small relative to the size of its economy. If it were to hand this amount of money (95 cents a day) to each of these 43 million people, it would cost the country $14.9 billion annually. This is just over 0.05 percent of its projected GDP for 2020 of $29.6 trillion. This target would still leave these and many other people very poor but if this is what China’s government is shooting for, there is little reason to think it will not be able to meet the target.
The article also says that China’s slowing growth will make reducing poverty more difficult. While it is harder to reduce poverty with slower growth rather than faster growth, China’s economy is still projected to be growing at more than a 6.0 percent annual rate, which is faster than almost every other country in the world.
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