World Bank President Paul Wolfowitz arrived in Lanzhou, capital
of northwest China's Gansu
Province, Wednesday for his first visit to the country since
taking over as head of the global institution.
The president flew directly to one of China's poorest and most
remote regions to see first hand the challenges confronting the
country he calls "a major global force."
Wolfowitz arrived in China after a two day trip to Japan which
included meetings with government officials, parliamentarians,
students as well as business leaders.
On the first leg of his visit to China, the World Bank president
is visiting poor people in rural villages in Gansu Province --
whose incomes are in the bottom one percent in China.
"China, as we all know, has been the fastest growing economy in
Asia for the past 20 years and has lifted more than 400 million
people above US$1 a day poverty levels in that time," Wolfowitz
said prior to his arrival in the country.
"And when we talk of China these days, we tend to think only of
Shanghai and skyscrapers, of trade surpluses and rapid economic
growth and above all, of amazing poverty reduction.
"These images are all true, but they don't tell the whole
story."
Lanzhou will also give Wolfowitz a firsthand experience of
another major challenge facing the country -- the environment -- as
the capital is one of the most polluted cities in the world.
The trip will also give the World Bank president the chance to
view efforts to combat environmental degradation. Wolfowitz will
visit a World Bank and government funded program, aimed at turning
part of the dry arid desert into lush green usable land.
The program is one of a series of projects in the Loess Plateau
region implemented in the late 1980s and early 1990s -- a program
that has been hailed as one of the largest and most successful
conservation programs in the world. Over the last two decades, Bank
funding helped turn dry arid land in the Loess Plateau to arable
land, lifting more than one million people out of poverty.
Wolfowitz will also visit other projects supported by the Bank
and other donors to reduce poverty in the region and meet some of
the rural families whose lives have been improved. He'll also meet
women who've benefited from a Bank managed project to empower women
in the western province -- by giving grants for the women to set up
small scale enterprises.
The bank president will also talk with provincial and local
government officials.
"I am looking forward to seeing firsthand how China has tackled
poverty on such a massive scale. I think the world has a lot to
learn from their experiences and I think the bank can work with
China to share those lessons," Wolfowitz said.
From the poor western province, Wolfowitz will proceed to Hebei
Province to participate in the Ministerial Meeting of the G-20,
which is hosted by China this year and attended by representatives
from a bloc of 20 developing nations, established in 1999.
The meeting, attended by finance ministers and central bank
governors, will discuss, among other issues, reform of the Bretton
Woods institutions as well as global imbalances.
The World Bank leader will then visit a nearby province of Hebei
where he will see a World Bank funded project which provides poor
farmers with microcredit to raise cattle, and also one of the
largest private gas distribution companies in China with investment
from the International Finance Corporation, the World Bank Group's
private sector arm.
Beijing will be the final stop on the trip, where Wolfowitz will
meet senior Chinese leaders and officials to discuss how the World
Bank can best support China's development goals.
Prior to his arrival in China, Wolfowitz said the country -- now
in its third decade of a transition from a planned economy to a
market economy -- has "redefined the competitiveness of virtually
every other country."
"Today people who make cars in Germany or saris in India are
equally challenged by China's rise. People who export iron ore from
Australia or Europeans who buy cheaper clothing benefit from the
effects of China's rapid growth and increased competitiveness.
"Our job, as a global institution, is increasingly going to be
to help countries adapt to this new environment and turn it to
their advantage," he said.
"The country faces some important challenges, especially in the
areas of environment, natural resources, and climate change, on the
one hand, and with remaining poverty and growing inequality, on the
other."
"These issues all affect the sustainability for growth. China
needs more and better infrastructure to provide a framework for
industry and to keep the cities operating efficiently. It needs to
deal with an ageing population.
"It needs to continue moving -- probably even more rapidly --
towards a more effective legal system and a better investment
climate."
Wolfowitz said the history of successful development left "no
doubt that weak public institutions could be a major bottleneck to
growth and investment."
While in China, Wolfowitz will also meet women's groups, civil
society organizations and students.
Statement by World Bank President Paul Wolfowitz on
Arrival in Lanzhou, China
I am delighted to be in China, and particularly glad to be here in
Lanzhou, and to have a chance to see for myself some of the
projects and processes the Chinese have employed to reduce poverty
so dramatically in such a short time. In the span of a few decades,
East Asia has experienced the greatest increase in wealth for the
largest number of people in the shortest time in the history of
mankind. It is an incredible fact, and of course, without this
growth in China, it wouldn't have happened.
Since 1980, China accounted for 75 percent of poverty reduction
in developing world.
Over the years, China has been a large borrower from the World
Bank, and is increasingly transitioning from borrower to donor. As
its role changes, so its relationship with the Bank will
change.
I intend to use this visit to achieve two main objectives:
First, I want to learn more about China's economic growth and
poverty reduction. We know that when China started its reform
process, its GDP per capita was among the lowest in the world -- on
the level of India, Pakistan, Kenya, Zambia, or Nigeria -- but with
growth of around 6 percent a year, it now has income levels
surpassing both of those countries. Since the beginning of economic
reform, China has lifted more than 400 million people out of
poverty. How did China do it? I want the World Bank to be able to
do more to help other countries learn too, so that elsewhere in the
world, we can see more progress made to improve the lives of the
poor.
Second, I want to understand more about what the Bank can do to
assist China in addressing the still large challenges of poverty in
the country. The Chinese leadership has identified a number of
areas of imbalance in the country, including the gap between urban
and rural incomes and the damage done to the environment in recent
years. China is the world's second largest emitter of greenhouse
gases and contains 20 of the 30 most air-polluted cities in the
world. There are also pressing issues relating to water and energy
usage that I hope to understand better from this visit. These are
areas where we have considerable experience, and where we can help.
China recognizes that stability depends on correcting these
imbalances and a number of others, and we certainly would like to
do what we can to support that effort.
(China.org.cn October 13, 2005)