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China’s Premier Admits to Serious Economic Crisis, With 600 Million People Earning $140 a Month

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Nicole Hao | New Tang Dynasty

After this year’s meetings of China’s rubber-stamp legislature concluded, Premier Li Keqiang revealed at a press conference that roughly 600 million Chinese citizens only earn 1,000 yuan, or roughly $140, a month.

That is not enough to pay for monthly rent on a one-bedroom apartment in a mid-sized Chinese city.

Li also admitted that the country was facing an unemployment crisis as many people have lost their jobs amid the pandemic and the country’s weakening economy.

He also admitted that millions continue to live in poverty, and do not have enough to eat. Furthermore, more people are struggling as a result of the pandemic, he said.

Poverty

Chinese leader Xi Jinping said during his 2020 new year’s message that his goal was for China to become a “moderately prosperous” society in the coming year.

But Xi’s target seemed out of reach, according to Li’s latest comments

On the afternoon of May 28, Li Keqiang held a video-based press conference in Beijing. To prevent the spread of the CCP virus, all journalists sat together in one room, while Li was in another room.

When a reporter asked Li about China’s plans for eliminating poverty and growing the middle class, Li answered: “Our average annual income is 30,000 yuan ($4,198). But there are 600 million people whose monthly income is only 1,000 yuan ($140).”

China’s population is 1.439 billion. 600 million is roughly 41.7 percent of the total population.

The premier also said that due to the economic impact of the epidemic, there will likely be more Chinese citizens living in poverty, and will need social security or other forms of government assistance to survive.

Unemployment

Li also acknowledged that unemployment is a major problem.

He explained that while reading internet comments, he came across a post by a migrant worker in his 50s who has worked for more than 30 years, but could not find a job this year.

According to Li, there are 900 million migrant workers in China. In addition, in July, 8.74 million students will graduate from university. These two groups, along with military veterans, are those in most need of a job, he said.

Li did not disclose an overall unemployment rate for the country but mentioned a previously announced unemployment rate based on people who are officially registered as urban residents and reported their job loss themselves—which is six percent.

The official figure does not include migrant workers who lost their jobs. It has been broadly questioned by Chinese scholars and international experts. On April 30, a director at a Chinese brokerage firm was removed from his position after he posted on social media an analysis that estimated that China’s true unemployment rate was roughly 20.5 percent.

Li said the central government would promote consumption in an effort to stimulate the economy and create more jobs.

China’s Economy

The premier also admitted that the pandemic has done serious damage to China’s economy, using the analogy of “a big car driving on a road covered with thorns.”

Beijing will cut down on expenses, and has also ordered local governments to do the same, he said.

Li also announced that the central government will issue national debt and local government bonds—valuing 2 trillion yuan ($280 billion) in total—to prop up the economy.

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