Business

Is the Chinese Dream achievable for all?

  • 8 July 2013
  • From the section Business
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Although it has come a long way, particularly on the more prosperous coast, China still has a long way to go before most of the country can become middle class.

This is why I went to the heartland of China and its most populous province with more than 110 million people (when the autonomously governed city of Chongqing is counted within Sichuan province) to find out what the Chinese Dream means.

Sichuan is where an earthquake that shattered ill-constructed schools and lives took place. It is also the home of China's panda sanctuary, and the province in which the political scandal involving former Commerce Minister Bo Xilai occurred.

Sichuan is ranked in the bottom third of China provinces in terms of average income. At just $4,600, it is 77% of the national average, and only about one-third of that of Beijing and Shanghai. This is why foreign and Chinese businesses have begun to move there to find cheaper labour.

'Gold Coast'

This is also where the next phase of growth must take hold. The "gold coast" of China still has potential but main cities like Beijing, Tianjin, Shanghai have already reached upper middle income status. It is harder for them to grow as costs have risen, so they need to innovate, as the advantages of being cheap have receded.

The east coast has 400m people - that is larger than the entire US population, which attests to the scale of China. It is just that China has another 900m in the interior who can help sustain its growth. Currently, the coast accounts for about three-quarters of China's GDP with one-third of its population, which gives a sense of the scale of the coastal-interior divide.

Notably, the rural-urban divide is great as well. In Sichuan, rural incomes are a quarter of urban incomes. But, half of China is classified as rural and that status can affect their life chances.

I saw it firsthand when I met a couple in Chengdu, who are the young whom the government seeks to inspire.

Rocky and Lena have just graduated and have dated since meeting at university. They share the same dream of a good job, a nice place to live, a car, good health, two children, and a dog. It is the American Dream without the white picket fence.

Rocky works in the Harley Davidson shop, while Lena is still looking for work. When I asked her why it has been so difficult to find one, she said that it was partly because her family background meant that she didn't have the same opportunities.

She was born to farmers in a village in Henan province. She is the first to go to university in her family and held a rural household registration until her parents moved to a small town when migration controls began to be relaxed.

Rural-urban divide

Known as 'hukou', the registration system has epitomised the rural-urban divide in China for decades. Initially instituted to control migration, it still affects the prospects of those born in the 1990s like Rocky and Lena.

Rocky's circumstances couldn't be more different. Born with an urban 'hukou', his parents were employed in the privileged state-owned sector. He is confident that he will own one of those pricey motorbikes soon.

According to Lena, his family background has helped to give him an easy confidence that she lacks. She also worries about her family and feels pressure to send money to them rather than benefitting from their financial support.

This is probably why Rocky thinks that he will achieve the Chinese Dream while Lena is less sure.

The Chinese Dream for these graduates is similar to what young Americans have dreamt of for decades. But, there are reasons why it isn't necessarily within reach.

One gauge as to whether China can become rich may come down to whether it can exhort its young to reach for the moon and produce the next Steve Jobs or Bill Gates. That may well be the true meaning of achieving the Chinese Dream for the country.