CRI听力:China to Adopt Measures to Shorten Income Gap

Although a distinction in income distribution is normal and inevitable process in a growing economy, these years have seen a gap rapidly widening in China. Thus, the government has recently adopted a series of measures to shorten income gap and improve people's livelihoods. Wu Jia has more.



The Gini coefficient, which is one way to measure income inequality, rose from 0.35 to 0.4 between 1988 and 1997 and reached 0.48 now in China.

Excessive income inequality not only undermines the stability of society but also hinders the general public from sharing the fruits of the country's development.

The State Development and Reform Commission has put forward a series of measures to accelerate the adjustment of national income distribution and narrow income disparities.

Shen Kunrong, associate dean of School of Economics at Nanjing University points out there are three major reasons behind this. Besides imbalanced development between regions and rural and urban areas, irrational income distribution plays an important part.

"Amid the process of market-driven competition, the salary levels in some state-monopolized sectors are much higher than that in other industries. Moreover, the secondary distribution, let's say tax system, has somewhat failed to dwindle such differences."

For most people, income from work may be the only one they have. When it takes up too low a proportion in the total national income, it becomes certain the consuming capacity is limited and domestic demand turns sluggish.

Zuo Xiaolei, chief economist at China Galaxy Securities, says we should at least synchronize people's salary increases with national economic growth.

"It's important for the transformation of our economy to increase people's disposable income standards, rural or urban residents and employees alike. Only in this way, we can increase the proportion of consumption in GDP."

To tackle this, one of the moves is to establish an effective mechanism for salary increases and to perfect an income distribution system by increasing the coordinating capacity of taxation.

While it has already been a consensus that providing more employment opportunity is the key to the problem, Shen Kunrong carries the idea further, saying that efforts should be put in strengthening people's job skills.

"If we can increase investment in employment training, especially for rural migrant workers and laid-off workers, their job skills and quality will be enhanced. This is an important aspect in ensuring they have a job opportunity. Employment is always the source of people's livelihood."

Experts point out that at this stage gray income is another big problem in rationalizing distribution system. Semi-overt income not only harms our distribution system but the morale of the whole of society as well.

For CRI, I'm Wu Jia.