Opinion | Asia’s anti-poverty gains are under threat as the coronavirus and deglobalisation deliver a double whammy

Too many people, especially outside China, are in danger of slipping back into destitution: governments must act now to hand out cash, fund universal pensions, disability and child benefits, and strengthen social safety nets for the long term

Reading Time:4 minutes

Published: 9:30am, 11 Jun 2020Updated: 9:30am, 11 Jun 2020

As the coronavirus pandemic grinds onwards, China’s goal of eliminating poverty by the end of this year looks far tougher than it did six months ago. At the end of the recent “two sessions” political gatherings in Beijing, Premier Li Keqiang sounded upbeat, saying the goal would be met. But, with its economy stalled, China’s recent anti-poverty gains threaten to slip back.

Yet if China is at risk, there is a far greater threat in the rest of Asia, and indeed across the emerging world. Whatever your view of recent decades of globalisation, it undeniably helped lift hundreds of millions out of subsistence living. Now, two factors are undoing that progress: first, the pandemic’s economic shock and, second, the unpicking of globalisation, on which much of Asia’s recent prosperity has depended.

Against this backdrop, China’s position is among the region’s least troubling. Poverty abolition remains one of President Xi Jinping’s “three tough battles”, along with preventing financial risks and curbing pollution, that must be won to deliver his “moderately prosperous society” target next year.

Official figures mentioned by Li last month suggest 0.6 per cent of China’s population remains poor. His government has been pushing that number down, partly by trying to rejuvenate poorer, rural areas and partly by using welfare schemes to top up incomes.

The coronavirus complicates this task. Unemployment is sure to rise this year. Workers with reduced incomes will send less money back to poor families. China’s social security net is patchy and many will fall back through its gaps.

Yet, the position is more alarming across much of the rest of the developing world. A dire global economic contraction will see the first worldwide increase in poverty rates in two decades this year, according to the World Bank, tipping as many as 100 million back into poverty.

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