Home / Economy / Covid hits China’s rural poor: ‘The impact on the village economy is huge’

SHAZHOU (CHINA) : For years, thousands of tourists flocked almost daily to this village in China’s southern Hunan province—an early stronghold of the Communist forces during the country’s civil war—to steep themselves in revolutionary history.

Pandemic-related travel restrictions and lockdowns over the past 12 months slowed that flow to a trickle. China moved this year to drop the curbs but the wave of Covid infections that followed has caused continued disruptions, Shazhou residents say.

“The impact on the village economy is huge," said Zhu Zhongxiong, a farmer in his 80s and longtime resident of the 500-person village where many were busy preparing for this month’s Lunar New Year celebrations.

Public health experts and economists have been watching the situation in China’s countryside closely around the holidays because of concerns that migrant workers returning to their rural hometowns could bring a surge in Covid cases and swamp local healthcare systems.

The chief epidemiologist at the Chinese Center for Disease Control and Prevention, Wu Zunyou, sought to tamp down those concerns earlier this month, saying 80% of Chinese people had already been infected with Covid, adding that a second big wave of cases in the next few months was unlikely.

China’s government has made narrowing the country’s urban-rural income divide a priority. In November 2020, the Communist Party said a yearslong poverty alleviation campaign had succeeded in eliminating extreme poverty nationwide.

Per capita disposable household income in rural areas grew to just over 17,000 yuan, or roughly $2,500, in 2020, compared with 9,400 yuan in 2013, the first full year in office for Chinese leader Xi Jinping.

The government’s zero-Covid policies at first seemed to be a boon to both urban and rural Chinese, who were able to lead something close to normal lives during the first two years of the pandemic as other countries were crippled by wave after wave of infections and government-imposed restrictions.

But an explosion in China’s use of lockdowns in response to the arrival of Omicron in early 2022 damaged the economy and helped fuel a sharp rise in youth unemployment.

China recorded GDP growth of 3% in 2022, one of the slowest paces of economic expansion since the death of Mao Zedong in 1976.

Migrants from the countryside tend to work either in factories or the service sector, which were both hit hard by Covid lockdowns.

Remittances by migrant workers to family members in rural areas fell during the pandemic, with eight out of 10 households that rely heavily on such contributions seeing an income drop of at least 10% during China’s initial effort to eradicate the virus in 2020, according to the Asian Development Bank. It isn’t known how remittance levels have changed more recently, although many migrant workers have reported continuing to struggle financially as some major cities were locked down last year.

Official data shows the gap in disposable income between rural and urban Chinese has grown by more than 2,400 yuan since the end of 2020, which was 18% quicker than the previous two-year period. Average disposable income for rural households in 2022 was the equivalent of about $3,000, compared with more than $7,200 for urban households.

China’s top economic-planning body, the National Development and Reform Commission, and the information office of China’s cabinet, the State Council, didn’t respond to requests for comment.

In Fengdu county, in the central region of Chongqing, most residents pointed to the economy as a greater source of anxiety than the virus. Nearly everyone The Wall Street Journal interviewed said he or she had already been infected with Covid but most reported having mild symptoms that they treated with painkillers and traditional herbal remedies.

When the virus first arrived, residents of Gao Tingming’s village in Fengdu erected barriers to keep outsiders from coming in and to protect themselves from Covid-19. Mr. Gao, farming potatoes on a recent afternoon, said he no longer fears the virus and trusts the government made the right decision to scrap zero-Covid when it did, but he remains scared of accruing medical bills he can’t afford.

“The rural economy is tough and the cost of being admitted into an intensive-care unit is really high," Mr. Gao said.

Spending on medical services and medicines by rural Chinese grew 15% between 2019 and 2022, outpacing growth in expenditures by urban residents, according to the National Bureau of Statistics.

Up the road from Mr. Gao’s farm, the owner of a shop selling women’s clothing and cosmetics said sales were down by half recently, as many consumers had switched to buying online during the pandemic. Many of the area’s brick-and-mortar stores had already closed, she said.

“It’s not just our store doing badly. It’s everyone struggling," she said.

The subdued scene in Fengdu stood in contrast to Beijing and other major cities, where restaurants and shops have begun coming back to life, and where some better-off residents are planning overseas vacations now that the government has loosened border controls. The rural economy could also recover as increased consumption in the cities trickles down to the countryside through greater demand for migrant labor.

Mr. Xi has sought to boost nationalism in what he calls the “new socialist countryside." A loudspeaker in Shazhou bellowed a patriotic tune by a children’s choir on a recent day.

“Listen to the party, go along with the party," the children sang.

Many residents credited Mr. Xi and the government for hefty spending on highways and high-speed rail lines that better connect rural areas with bigger cities, where jobs are more plentiful.

Still, said one shopkeeper in rural Hunan, life in China had become more unpredictable under the current leadership.

“China is a country ruled by man, not by the law," he said.


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