The right path

["Henry C.K. Liu" <hliu@xxxxxxxxxxxxxx>]

China's rulers to aid farmers

China's top governing bodies have set out new policies to close the
wealth gap between farmers and city dwellers, the official news service
has said.

The proposals include tax cuts for China's 900 million farmers, combined
with greater efforts to modernise agriculture and create rural industry.

The plan was drawn up by the cabinet-level State Council and the ruling
Communist Party 's Central Committee.

They warn in it that stagnant rural earnings threaten stability and growth.

The report says the most important problem in the Chinese countryside
"is that it difficult for farmers to increase their income", the
official Xinhua news agency reported.

Political risks

It warns that if farmers' living standards remain stagnant for long the
output of grain and other farm goods could fall.


This threatens to "constrain the growth of the rural economy and the
national economy" and to hinder "the goal building a relatively affluent
society in an all-round way", the report said.

It proposes to cut agricultural taxes by 0.1% this year and to abolish
the levies imposed on specific crops, except for tobacco.

The report sends a signal to Communist Party officials about the need to
take peasants' rights seriously.

Farmers' protests against unfair, unaffordable and arbitrary taxes
imposed by local officials are commonplace in China.

Smoothing out inequality

The report says that "the leadership of the Party should be strengthened
to ensure that all policies to help farmers increase their income are
implemented to the letter".

Premier Wen Jiabao has highlighted inequality in his speeches since he
stepped into the job at the National People's Congress in February 2003.
He has made well-publicised visits to poor districts and won popularity
as a leader with the common touch.

Before becoming premier, Mr Wen was linked with measures to narrow
China's wealth gap, such as the campaign to develop the poorer western
provinces.

Chinese officials estimate there are about 100 million migrant workers,
mostly ex-farmers, working in the cities. In the last few years, the
authorities have scrapped or eased controls which put migrant workers at
constant risk of arrest.

Urban incomes rose 9.3% last year, while rural incomes grew by only
4.3%, the National Statistics Bureau said.