03/16/2007, 00.00
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As the NPC comes to a close, Wen Jiabao tries to be reassuring but problems persist

by Bernardo Cervellera
At the end of the National People’s Congress, China’s premier meets the press and reassures the public about the government’s commitment to development, schools, health care and defence. As expected the right to private property is now guaranteed in law. However, some critical voices point out that China still lags behind in terms of health care and education spending.

Rome (AsiaNews) – The current session of the 10th National People's Congress came to a close today amid resounding applause by the delegates. Great promises were made to continue on the path of economic openness within the existing Communist political system. In meeting the 700 or so accredited journalists who followed the two-week long session Premier Wen Jiabao tried to be reassuring as he talked about the economy, politics, foreign relations and military spending. However, he was a bit touchy when it came to unfulfilled promises regarding chronically under-funded health care and education, a problem which has been particularly hard on rural folks, who remain the bulk of China’s population.

Private property and taxes

By an overwhelming majority of more than 90 per cent NPC delegates approved the new law that guarantees public and private property. The law, 13-years in the making, was adopted with 2,799 votes, 52 against and 32 abstentions (one delegate was not present). The law, which will come into effect on October 1, is expected to put to end to seizures and confiscation of property that fuelled social unrest in tens of thousands of incidents.

Not everyone welcome the law however. Some delegates slammed the piece of legislation for selling out the country to capitalism. But its sponsors and NPC Deputy Chairman Wang Zhaguo came to its defence arguing that it was the only way for China’s “socialist economy” to progress.

More than 90 per cent of the delegates also approved a new tax law that unified the corporate rate for foreign and domestic companies at 25 per cent ending advantages hitherto enjoyed by foreign firms. The World Trade Organisation had requested such a change.

Too little for schools and health care

The government’s economic plan, which calls for an 8 per cent annual growth rate and greater investment in the environment and against poverty, was voted by 99.1 per cent of NPC delegates.

In his address to the congress, Premier Wen Jiabao said that the country should not give priority only growth and competition but should instead tackle rural poverty and school dropout. Delegates responded by approving the government’s plan to spend 31 billion yuan (€ 3.1 billion; US$ 4 billion) in health care and 85.8 billion yuan (€8.6 billion; US$ 11 billion) in education.

But despite representing respectively an increase of 86.8 per cent and 41.7 per cent, these funds are but a drop in the ocean if compared to the actual needs of the target group involved. In fact, so far health care and education spending have been skewed in favour of the urban population (80 per cent) compared to rural communities (20 per cent). Even with these increases the government will be spending only 6 dollars in health care and 18 dollars in education for rural folks.

Ba Denian, former president of the Chinese Medical Sciences, said that public spending in health care amounts to only 2.7 per cent of GDP, placing China in 144th position in the world. Actually, even though China has the 4th largest economy in the world it is fourth-last in terms of the equality of health care it provides to rich and poor.

Even in terms of education, China lags behind with less than 3 per cent of GDP spent on education, having failed to meet its own target set in 1993 of 4 per cent.

Inequalities and democracy

Such gaps between intent and action become more glaring if we consider that the NPC approved the defence budget which is set to reach 351 billion yuan (€35 billion; US$ 45 billion), which represents an increase of 17.8 per cent over the previous year.

Still Mr Wen tried to reassure journalists saying that China’s defence build-up does not represent a threat to the region. He said that Chinese military spending was low, a small figure even when compared to some developing countries.

The premier also confirmed the government’s plan to set up a company, independent of any government department, to invest its huge foreign exchange reserves which now stand at US trillion.

He stressed that the main headache for the government will be balanced development and the reduction of the gap between cities and rural areas and between the richer coastal regions and the poor interior.

However, some NPC delegates from Jiangsu pointed to contradictions in government policy which instead of reducing the gap tended to accentuate it like higher prices for fertilisers and pesticides without raises in what farmers get for the food they produce. The net result is greater rural poverty.

Premier Wen Jiabao promised never the less that justice and equity will top the government’s priority list as it builds the socialist system.

As for a possible transition to democracy, Wen said that China lacked experience in the area but was still willing to learn from other countries how to build democracy “Chinese-style.”

The National People’s Congress ended as AsiaNews had predicted a few days ago (see “NPC: Wen Jiabao’s nice promises raise doubts,” March 7, 2007) regarding the effectiveness of the steps taken by China’s leaders in building an truly harmonious society. Its article even came in for some strong criticism by China Review News, which said that the slow pace of promised changes was due to the county’s “difficulties” and “size.”

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