China's Poor Getting Poorer

The China Economic Review notes:

The real income of the poorest 10% of China's 1.3 billion people fell by 2.4% in the two years to 2003, an analysis by World Bank economists has found. Meanwhile, average incomes for China's richest decile rose by more than 16%.The findings challenge the basis of government policies aimed at narrowing the country's politically sensitive wealth gap, which President Hu Jintao has made a centerpiece of his administration's economic policies, the Financial Times reported. Yasheng Huang, of the MIT Sloan School of Management, said the Chinese understated the extent of poverty by defining it as roughly US$83 in annual income, equal to about 5% of average per capita income. The US definition of poverty is 12% of average per capita income.

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