World Energy Outlook 2007

Yet pockets of extreme poverty remain. Recent Chinese estimates (Shu, 2006)
suggest that less than 3.7% of China’s total population is currently poor but
that figure is based on the official poverty line, which is meant primarily to
measure the minimum income needed to meet basic needs, such as food and
clothing. Using the World Bank’s international poverty standard of $1 per day
per person (in PPP terms), it is estimated that at the end of 2006 China had
about 105 million poor people – 8% of the population (World Bank, 2007a).
Using the $2-a-day standard, the number of poor in 2006 is estimated at a little
over 340 million people, or 26% of the population. While poverty is still
widespread in urban areas among recent migrants, the long-term challenge for
China lies in eradicating rural poverty.
400
Figure 7.5: Number of Poor*
35%
million
350
300
250
200
150
100
50
30%
25%
20%
15%
10%
5%
0
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008
Number of urban poor
Number of rural poor
Share of population (right axis)
0%
* Measured using the World Bank’s “one-dollar-a-day” definition (a poverty line of $1.08/day in 1993 PPP).
Sources: IEA estimates and World Bank (2007c).
Clearly, industrialisation and urbanisation have been key drivers of poverty
reduction. Urban poverty is less prevalent than in most other developing
countries – even allowing for possible undercounting of recent migrants to
urban areas. The registered urban unemployment rate in 2006 was 4.1%,
suggesting that cities have been able to absorb workers migrating from rural
areas. While the urban share of the population has grown (see next section), the
urban share of the poor has decreased in recent years and currently stands at
7%. Alleviating poverty therefore hinges on rural development and the
254 World Energy Outlook 2007 - CHINA’S ENERGY PROSPECTS