ActionAid efforts in dealing with income inequality in China

ActionAid China^[1] is an association aiming to eradicate poverty and injustice in China in collaboration with institutions and non-governmental institutions. ActionAid has established 14 Development Areas (DA) in 14 counties of 5 provinces in China, working with rural people in 186 villages in 40 townships, thus creating intensive connections in order to alleviate poverty and promote productivity. It is estimated that 150 000 women, children and poor farmers have benefited from the organisation directly or indirectly.

Status

Despite the fact that ActionAid China is not registered in China, they have signed a 3 years Memorandum of understanding (MOU) with Guangxi provincial poverty alleviation department in the year 2009. Under MOU, they have established a semi independent official bank account and a registered centre used for receiving, transferring funds and for fundraising purposes respectively.

Projects

To tackle the problem of inequality, a combination of projects are pursued.

Revolving Fund

Revolving Fund is a project that provides reliable credit loans to the rural poor in Shangping village. It has attracted 33 families and as many as 70-80% of women to take up loans. The very poor are also given priority when it comes to the application for loans. While the middle income families use the loans to uplift their economic status, the poor often rely on the loans for children's education, treatment purposes and even to rear agricultural stocks. Therefore, it is crucial for the rural poor to have access to reliable credit markets so as to allow them to escape the poverty trap.

Women's activity center

ActionAid China has also established women's activity center in Shangping village^[2] as an effort to reduce illiteracy rate in rural China so as to solve the problem of income inequality due to educational differences. In attempt to expand this model, the launching of "Little Sunshine Teacher" program in the Zhangjiachuan district2 allows children to be teachers for their illiterate mothers and it aims to take advantage of these educated children to reduced illiteracy in rural areas. This project has been established in more than 10 villages in the Hui County and it aims to further expand the model to the rest of rural China in future to benefit more women.

Participatory budgeting

Thirdly, in 2007, ActionAid embarked on a project in partnership with Huai'en Poverty Alleviation Office and local institutions on Participatory Budget Analysis^[3] planning work in Huai'an County. As inefficiency in budget allocation will contribute to income inequality, a carefully devised government public spending will cater to the needs of the poor and disadvantaged. In general, Participatory Budget Analysis project helps to facilitate communication between the poor and government, thereby ensuring that the poor will have a more equitable share of the economic growth.

Future plans

In the next 2 years, Actionaid hopes to enforce pro-poor policy in financial aid and investment plans is various institutions and to further enhance rural migrant workers' knowledge on safe migration and skills.

All these programs are aimed at improving the lives of the disadvantaged group in the population. Hence, with the help of ActionAid, there is anticipation for more growth in future for China.

References