Poverty Reduction Strategy of China

China is the first country that successfully eradicated or eliminated poverty in a very limited time. There is a lot to learn from China for the rest of the world. China can contribute to global development in many ways. In the following paragraphs, we will try to study the Chinas’ methodology in depth. We will figure out the basic mechanism that the Chinese government followed in achieving this milestone.



In 1935, a line was drawn on the Geographical boundaries of China, which was called "The Hu line”. This line was assumed to divide the country depending upon the Population, Area, and Economic stability of regions. The country was divided into two parts, the eastern and western regions. According to the census in 1935, the eastern side of the “Hu Line” was composed of 43.71% of the total area   94.39% of the total population of the country whereas, the western side consisted 56.29% of the total area and 5.61% of the total population of the country. In 2010, according to the 6th National Census, a very minor change was observed in population ratio in comparison with the 1935 census. These senses also calculated that 80% of Chinas’ total rural population lived in the western region.

It was one of the biggest challenges for the Chinese Government to tackle such a huge difference in population in both regions. Most of the poor people were living in western provinces such as Tibet, Xingang, Sichuan, Yunnan, Gansu, Qinghai, etc. These areas were very fair and remote (not easily assessable) as compared to the eastern region which was more developed and economically stable. These areas became a battlefield for the Chinese government against eliminating poverty. The western region was facing a lot of problems regarding healthy food, proper clothes, shelter, transport, infrastructure, health facilities, education, ease in business, etc. The Chinese government, keeping in mind all these Issues, introduced a Five-Pronged Strategy. These strategies were implemented at a grass root level to bring a tremendous change towards poverty elimination.


The five-pronged strategies include 

  1. Development of local industries.
  2. Relocation 
  3. Ecological restoration
  4. Education
  5. Social Change

In 2015, at a high-level forum for Poverty Alleviation and Development, held in Beijing. China made a key proposal to eliminate poverty among all people living below the poverty line, defined by the UN, in the next five years. 

  • Development of local Industries: In rural areas, there was a huge capacity for building new Industries and engaging people in healthy activities. For this purpose, researchers were hired to highlight the capacity area for business growth in a particular region. The different region was provided with industries suited to their local conditions. Farming industries were developed in areas where chicken and sheep farming were compatible. Similarly, embroidery workshops were built to give new Jobs to the woman also. Pepper industries were also built in different regions in western China to enhance the economic activity in the region. All this industrialization was backed by the Chinese Government and eastern developed regions. New business ideas were introduced and entrust free loans were provided to poor people below the poverty line. New infrastructure such as roads, bridges, dams, powerplants were also build to provide ease in business. Cheap electricity was also provided to run industries. Within 1 year, China was in a position to bring up 10 million people above the poverty line, annually.
  • Relocation: Relocation was one of the strategies to eliminate poverty from areas where infrastructure was nearly impossible to develop. In regions like Tibet, where huge mountains made it very difficult to develop roads, bridges, hospitals schools, etc. government built new residences for people living in such remote areas. This step brought a huge number of poor people towards new business ideas and investments. This helped them out of difficult economic conditions.
  • Ecological Restoration: Government also played a part in building economic zone was poor people. The policy was to engage them in industrialization so that they can easily fulfill their needs. News methods for agriculture were introduced to the framers. Greenhouse cultivation was introduced in regions with less rain. Fruits, Vegetables, flowers were grown and sold to new markets build by the government.
  • Education: As we know that education is the most powerful weapon to change the world. China brought reforms in its education system. Less theoretical work and more practical work were introduced. Creative and critical thinking was encouraged. New education institutes were built in remote areas where there was no education before. People were given new concepts of earning.
  • Social Change: China brought a revolution in all its sectors. New social interactions were introduced. More tools of effective communication were provided to the regions with less technology. China brought opportunities for the poor. Social norms and values were enhanced. People were given everything necessary to flourish. The strategy was to encourage coordinated and mutual development.

The hard work of the Chinese government and people collectively created history. According to a result in 2019, the percentage of people living in extreme poverty in China had reduced from 10.21% to 0.6% with an average of 10 million people per year. This model of poverty Reduction should be followed by the rest of the world.