Reuters: “For Chen Qiuyang, the new Chinese leadership that formally takes over this month can radically improve her life by doing just one thing: providing running water in her village in a remote corner of the northwestern province of Gansu.
“We have to carry water from the well on our shoulders several times day. It’s exhausting,” Chen, who looked older than her 28 years, said in Yuangudui village, resting on a stool outside her home after completing another trip to the well.
Communist Party chief Xi Jinping takes over as China’s new president during the annual meeting of parliament beginning on Tuesday and bridging the widening income gap in the vast nation is one of his foremost challenges.
Xi has effectively been running China since assuming leadership of the party and military – where real power lies – in November, and has already projected a more relaxed, softer image than his stern predecessor Hu Jintao.
But there will be pressure on him to tackle problems accumulated during Hu’s era like inequality and pervasive corruption, which have given rise to often violent outbursts in the world’s second-biggest economy, sending shivers through the party.
Outgoing Premier Wen Jiabao will likely address these issues in his last “state of the nation” report at the National People’s Congress to nearly 3,000 delegates, whose ranks include CEOs, generals, political leaders and Tibetan monks – as well as some of China’s richest businessmen.
China now has 317 billionaires, a fifth of the total number in the world, and is on track to overtake the United States as the largest luxury car market by 2016.
Yet the United Nations says 13 percent of China’s 1.3 billion population, or about 170 million people, still live on less than $1.25 a day.
While parliament is a regimented show of unity that affirms rather than criticizes policies, income redistribution is likely to be a hot topic, along with other issues like ministry restructuring, corruption and the environment.
In January, the State Council, or cabinet, issued a new fiscal framework designed to make rich individuals and state corporations contribute more to government coffers and strengthen a social security net for those at the bottom.
But tackling China’s wealth gap will need more than just taxes. Analysts say state-owned enterprises will have to be privatized and the household registration, or hukou, system that prevents migrants from enjoying the benefits of urban citizens, will have to be dismantled.
“Fiscal reforms and changes to let private firms advance and the state retreat will decide whether this round of reforms can succeed,” said Xia Bin, an economist at the cabinet think-tank Development Research Centre and a former central bank adviser.
“There is definitely no way out,” he wrote in the latest edition of China Finance, a magazine published by the central bank.
via A push for change in China as new leaders take the helm | Reuters.
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