Industrial Development Models to Lift SW China Counties Out of Poverty
By Cheng Yahui
Original, GPIG, 03-01-2017
Women workers at Yunnan Dali Erbao Foods Co., Ltd. [yunnan.cn]
Four counties in Dali Bai Autonomous Prefecture in southwest China’s Yunnan Province will soon be free of poverty, thanks to their successful rural industrial development models.
Over the course of 2016, each of the counties of Weishan, Eryuan, Binchuan and Xiangyun implemented their respective poverty-relief strategies, which basically bring into play local Party branches, leading businesses, and the anti-poverty funds received by households.
Model 1: ‘Local Party Branch + Leading Enterprises + Poor Households’
From the end of 2015, authorities in Weishan County began to initiate a model of engaging local Party branches and impoverished households, along with a “third party” which could be a leading business, a cooperative, a relevant department, or some other organ or individual with experience of playing a leading role in poverty reduction.
One of the chosen enterprises, Dali Shidai Agricultural Science and Technology, is contracted to provide each participating household with an annual dividend of 10 percent of their investment over a span of five years.
On June 16, 2016, the corporation paid the first dividends to 100 household investors – a total of 500,000 yuan (U.S. $72,840). Company representative Zuo Jilong reveals that in addition to the cash dividend, rural stakeholders can also enjoy returns on their rights to contracted farmland, while there are stable incomes for those who work in the company. The average annual income of the local residents exceeds 20,000 yuan (U.S. $2,914) from these three sources.
While helping the villagers eliminate poverty, Dali Shidai itself also benefits from the cooperation. With the 5 million yuan (U.S. $728,400) investment from the rural cooperative, it has expanded its vineyard by 300 mu (49 acres), planting a new variety of grape to be harvested on days alternating with the traditional peak season. “The wholesale price can reach as high as 25 yuan (U.S. $3.60) per kilogram,” said Zuo.
Xie Youli, a 65-year-old who previously made a living from the soil to support his sick son and his daughter-in-law, has been working as a seasonal laborer at the vineyard, earning 80 yuan (U.S. $11.7) a day. With the addition of the annual dividend and the payment for his farmland from the company, he has a yearly income of more than 10,000 yuan (U.S. $1457). “My son says he has never seen so much money before,” says Xie.
“The Party branch performs the role of ‘matchmaker’,” quips Luo Baoling, Party chief of Miaojie Township. “But it does not interfere with the process; both the enterprises and farmers can make their own choices.”
To date, this poverty-relief model has attracted 48,623 households in Dali to take part in local rural industrial development.
Model 2: ‘Local Party Branch + Farmers’ Cooperatives’
Authorities in Daying Township, Binchuan County have created an innovative mechanism: guiding local people to set up their own cooperatives while bringing in professional support in technology, management and marketing from eligible enterprises.
Party workers of Hecun Village led the foundation of Binchuan Tianzi Agricultural Cooperative. This involved obtaining loans of 15 million yuan (U.S. $2.2 million), leasing farmland of 200 mu (33 acres) over a period of 20 years, and introducing a local agricultural technology company to run the daily operations.
The vineyard run by Binchuan Tianzi Agricultural Cooprative [yunnan.cn]
Each member household, having made an investment of 50,000 yuan (U.S. $7,280), can receive an annual return of 5,000 to 8,000 yuan (U.S. $728 to 1,165), as well as rental for their land amounting to 1,500 to 4,500 yuan (U.S. $219 to 657) per year. Moreover, able-bodied residents can take jobs with the cooperative to give themselves stable long-term incomes.
This kind of reward mechanism generates strong motivation in the villagers, and effectively transforms the circumstances of those who were previously indigent and trapped in a cycle of simply relying on government aid without making any effort for themselves. All of the 141 households in the village previously classified as destitute have involved themselves in the cooperative, enjoying an average rise in income of up to 20,000 yuan (U.S. $2,914).
In the village of Xinzhuang, Qiaodian Township, the local Party branch called upon Pu Guohong, an entrepreneur who had been working away from his hometown, to come back and start a tour company taking advantage of the region’s revolutionary tourist attractions.
Each of the village’s 13 poor households has invested 3,846 yuan (U.S. $560) in the company’s tourism projects, and the disadvantaged residents can also work with the company and receive a respective daily payment of 60 or 120 yuan (U.S. $8.70 and 17.40),in slack and busy farming seasons.
Since its inauguration on April 21, 2016, Xinzhuang Red Army Museum, one of the company’s programs, has welcomed over 80,000 visitors, enjoying revenues exceeding 700,000 yuan (U.S. $101,974) and bringing an average income increase of 6,000 yuan (U.S. $874) to each of the village’s families. The 13 poor households were each rewarded with an additional 4,093 yuan (U.S. $596) last year, thanks to their involvement in local tourism.
Xinzhuang Red Army Museum [yunnan.cn]
Yang Fahui, 33, a former grape producer in Xinzhuang, has been working with the company since last August, earning 2,500 yuan (U.S. $364) a month and thereby enjoying a much better standard of living.
“At the very beginning, people couldn’t understand why they should join the tourism project,” recalls Zi Rutao, chief of Qiaodian Township government. “But after listening to the persuasive explanations of the Party workers, they all made investments - they even offered their homesteads to the company to use for free.”
In addition to the residents in Xinzhuang, 98 families in the wider community of Haishao, at a higher administrative level, have also become stakeholders of Pu’s startup. They have each invested 5,000 yuan (U.S. $728) in his grape producing business. These investors shared dividends totaling 39,200 yuan (U.S. $5,711) last year.
Model 3: Mutual Help between Enterprises and Households in Need
Party workers in many counties in Dali have also adopted the method of building connections between enterprises which need finance and destitute rural families who have received anti-poverty funds of 50,000 yuan (U.S. $7,284).
Xingrong Husbandry in Weishan County attracted a total investment of 6 million yuan (U.S. $874,062) from 120 households, and is contracted to give each of the investors an annual return of 5,000 yuan (U.S. $728) over a span of five years. Alternatively, the stakeholders can choose to pay another 3,000 yuan (U.S. $437) and receive a cow worth 8,000 yuan (U.S. $1,165). The company will send professionals to help them build their own cattle breeding business. More than 300 families have now joined the program.
The cattle farm of Xingrong Husbandry Co., Ltd. [yunnan.cn]
Another enterprise in Weishan, Jianhong Trading, received individual investments of 50,000 yuan (U.S. $7,284) from 1,052 families spread over 24 villages last year. By the end of 2016, these households had shared dividends of 5.74 million yuan (U.S. $836,186) and the 24 villagers’ committees saw their collective revenues increase by a total of 480,000 yuan (U.S. $69,925).
Currently, the company has 328 full-time workers and hires 12,000 casual laborers each year. It plans to build a large-scale organic fertilizer factory, which, coupled with a chicken farm, will produce 13,000 jobs and benefit more than 3,000 rural families.
The chicken farm of Jianhong Trading Co., Ltd. [yunnan.cn]
Yunnan Dali Erbao Foods in Eryuan County obtained investments totaling 5 million yuan (U.S. $728,400) from 100 poor families, and has paid each of the investors a return of 4,000 yuan (U.S. $583) in the first year.
Zhang Shouhua, who has worked with the company for ten years, makes 2,500 yuan (U.S. $364) a month. “I used to earn very little from farming,” she says. “Now my income is much higher and my life is much better. Working here, I can earn my living and take care of my family at the same time.”
Dali Pinhong Plateau Agricultural Technology Development, also in Eryuan, pledges to give 100 households an annual dividend amounting to 8.5 percent of their investment. Its manager has also committed to give preferential treatment to the local poor in purchasing their produce and in recruiting labor. Additionally, the company has allocated 550,000 yuan (U.S.$80,122) this year to give each disadvantaged family a payment of 1,000 yuan (U.S.$146),directed to help their development.
In Xiangyun County, 21 enterprises are engaged in assisting 21 destitute villages. Cao Shengzu, Party chief of one of the companies, Longyun Foods, explains that the organization attracted investments totaling 40 million yuan (U.S. $5.83 million) from 800 families to promote its own development. In return, it has pledged to give each of the investors a yearly dividend of 3,000 yuan (U.S. $437) over three years.
Across 12 counties in Dali there are a total of 316 enterprises involved in the mutual assistance program, along with 300poor local households, notes Shi Yubing, director of the prefecture’s Poverty Alleviation Office. The companies have attracted 534 million yuan (U.S. $77.8 million) in investments from 16,986 families, while bringing increased incomes to 26,682 households in return and directing 34.33 million yuan (U.S. $5 million) to the development of the villagers. By the end of 2016, the investing households had received dividends totaling 59.19 million yuan (U.S. $8.6 million), averaging out at 3,484 yuan (U.S. $508) per family.
Model 4: Local Companies Recruiting Impoverished Villagers
A female worker in Yunnan [yunnan.cn]
In the county of Xiangyun, poor villagers can choose to work at enterprises close to their home. Through the anti-poverty program, Li Jiasheng, a local community member, has become a regular employee at Yunnan Xiangyun Feilong Recycling Technology, earning a monthly income of 3,200 yuan (U.S. $466).
Yao Chunbin, director of Yunnan Xiangyun Feilong Recycling Technology, explains that the organization recruited workers from 182 disadvantaged families last year, with a further 1,500 to 3,000 individuals to be trained and employed in 2017.
To eliminate poverty, the first target should be igniting and strengthening people’s ambition, Yao observes. In combination with targeted anti-poverty efforts initiated by the government, his organization has launched training sessions to teach skills to the poor and give them the motivation to forge ahead. The aim is to change their mindset from passively relying on aid to striving for a better life.
By Cheng Yahui
Original, GPIG, 03-01-2017
Women workers at Yunnan Dali Erbao Foods Co., Ltd. [yunnan.cn]
Four counties in Dali Bai Autonomous Prefecture in southwest China’s Yunnan Province will soon be free of poverty, thanks to their successful rural industrial development models.
Over the course of 2016, each of the counties of Weishan, Eryuan, Binchuan and Xiangyun implemented their respective poverty-relief strategies, which basically bring into play local Party branches, leading businesses, and the anti-poverty funds received by households.
Model 1: ‘Local Party Branch + Leading Enterprises + Poor Households’
From the end of 2015, authorities in Weishan County began to initiate a model of engaging local Party branches and impoverished households, along with a “third party” which could be a leading business, a cooperative, a relevant department, or some other organ or individual with experience of playing a leading role in poverty reduction.
One of the chosen enterprises, Dali Shidai Agricultural Science and Technology, is contracted to provide each participating household with an annual dividend of 10 percent of their investment over a span of five years.
On June 16, 2016, the corporation paid the first dividends to 100 household investors – a total of 500,000 yuan (U.S. $72,840). Company representative Zuo Jilong reveals that in addition to the cash dividend, rural stakeholders can also enjoy returns on their rights to contracted farmland, while there are stable incomes for those who work in the company. The average annual income of the local residents exceeds 20,000 yuan (U.S. $2,914) from these three sources.
While helping the villagers eliminate poverty, Dali Shidai itself also benefits from the cooperation. With the 5 million yuan (U.S. $728,400) investment from the rural cooperative, it has expanded its vineyard by 300 mu (49 acres), planting a new variety of grape to be harvested on days alternating with the traditional peak season. “The wholesale price can reach as high as 25 yuan (U.S. $3.60) per kilogram,” said Zuo.
Xie Youli, a 65-year-old who previously made a living from the soil to support his sick son and his daughter-in-law, has been working as a seasonal laborer at the vineyard, earning 80 yuan (U.S. $11.7) a day. With the addition of the annual dividend and the payment for his farmland from the company, he has a yearly income of more than 10,000 yuan (U.S. $1457). “My son says he has never seen so much money before,” says Xie.
“The Party branch performs the role of ‘matchmaker’,” quips Luo Baoling, Party chief of Miaojie Township. “But it does not interfere with the process; both the enterprises and farmers can make their own choices.”
To date, this poverty-relief model has attracted 48,623 households in Dali to take part in local rural industrial development.
Model 2: ‘Local Party Branch + Farmers’ Cooperatives’
Authorities in Daying Township, Binchuan County have created an innovative mechanism: guiding local people to set up their own cooperatives while bringing in professional support in technology, management and marketing from eligible enterprises.
Party workers of Hecun Village led the foundation of Binchuan Tianzi Agricultural Cooperative. This involved obtaining loans of 15 million yuan (U.S. $2.2 million), leasing farmland of 200 mu (33 acres) over a period of 20 years, and introducing a local agricultural technology company to run the daily operations.
The vineyard run by Binchuan Tianzi Agricultural Cooprative [yunnan.cn]
Each member household, having made an investment of 50,000 yuan (U.S. $7,280), can receive an annual return of 5,000 to 8,000 yuan (U.S. $728 to 1,165), as well as rental for their land amounting to 1,500 to 4,500 yuan (U.S. $219 to 657) per year. Moreover, able-bodied residents can take jobs with the cooperative to give themselves stable long-term incomes.
This kind of reward mechanism generates strong motivation in the villagers, and effectively transforms the circumstances of those who were previously indigent and trapped in a cycle of simply relying on government aid without making any effort for themselves. All of the 141 households in the village previously classified as destitute have involved themselves in the cooperative, enjoying an average rise in income of up to 20,000 yuan (U.S. $2,914).
In the village of Xinzhuang, Qiaodian Township, the local Party branch called upon Pu Guohong, an entrepreneur who had been working away from his hometown, to come back and start a tour company taking advantage of the region’s revolutionary tourist attractions.
Each of the village’s 13 poor households has invested 3,846 yuan (U.S. $560) in the company’s tourism projects, and the disadvantaged residents can also work with the company and receive a respective daily payment of 60 or 120 yuan (U.S. $8.70 and 17.40),in slack and busy farming seasons.
Since its inauguration on April 21, 2016, Xinzhuang Red Army Museum, one of the company’s programs, has welcomed over 80,000 visitors, enjoying revenues exceeding 700,000 yuan (U.S. $101,974) and bringing an average income increase of 6,000 yuan (U.S. $874) to each of the village’s families. The 13 poor households were each rewarded with an additional 4,093 yuan (U.S. $596) last year, thanks to their involvement in local tourism.
Xinzhuang Red Army Museum [yunnan.cn]
Yang Fahui, 33, a former grape producer in Xinzhuang, has been working with the company since last August, earning 2,500 yuan (U.S. $364) a month and thereby enjoying a much better standard of living.
“At the very beginning, people couldn’t understand why they should join the tourism project,” recalls Zi Rutao, chief of Qiaodian Township government. “But after listening to the persuasive explanations of the Party workers, they all made investments - they even offered their homesteads to the company to use for free.”
In addition to the residents in Xinzhuang, 98 families in the wider community of Haishao, at a higher administrative level, have also become stakeholders of Pu’s startup. They have each invested 5,000 yuan (U.S. $728) in his grape producing business. These investors shared dividends totaling 39,200 yuan (U.S. $5,711) last year.
Model 3: Mutual Help between Enterprises and Households in Need
Party workers in many counties in Dali have also adopted the method of building connections between enterprises which need finance and destitute rural families who have received anti-poverty funds of 50,000 yuan (U.S. $7,284).
Xingrong Husbandry in Weishan County attracted a total investment of 6 million yuan (U.S. $874,062) from 120 households, and is contracted to give each of the investors an annual return of 5,000 yuan (U.S. $728) over a span of five years. Alternatively, the stakeholders can choose to pay another 3,000 yuan (U.S. $437) and receive a cow worth 8,000 yuan (U.S. $1,165). The company will send professionals to help them build their own cattle breeding business. More than 300 families have now joined the program.
The cattle farm of Xingrong Husbandry Co., Ltd. [yunnan.cn]
Another enterprise in Weishan, Jianhong Trading, received individual investments of 50,000 yuan (U.S. $7,284) from 1,052 families spread over 24 villages last year. By the end of 2016, these households had shared dividends of 5.74 million yuan (U.S. $836,186) and the 24 villagers’ committees saw their collective revenues increase by a total of 480,000 yuan (U.S. $69,925).
Currently, the company has 328 full-time workers and hires 12,000 casual laborers each year. It plans to build a large-scale organic fertilizer factory, which, coupled with a chicken farm, will produce 13,000 jobs and benefit more than 3,000 rural families.
The chicken farm of Jianhong Trading Co., Ltd. [yunnan.cn]
Yunnan Dali Erbao Foods in Eryuan County obtained investments totaling 5 million yuan (U.S. $728,400) from 100 poor families, and has paid each of the investors a return of 4,000 yuan (U.S. $583) in the first year.
Zhang Shouhua, who has worked with the company for ten years, makes 2,500 yuan (U.S. $364) a month. “I used to earn very little from farming,” she says. “Now my income is much higher and my life is much better. Working here, I can earn my living and take care of my family at the same time.”
Dali Pinhong Plateau Agricultural Technology Development, also in Eryuan, pledges to give 100 households an annual dividend amounting to 8.5 percent of their investment. Its manager has also committed to give preferential treatment to the local poor in purchasing their produce and in recruiting labor. Additionally, the company has allocated 550,000 yuan (U.S.$80,122) this year to give each disadvantaged family a payment of 1,000 yuan (U.S.$146),directed to help their development.
In Xiangyun County, 21 enterprises are engaged in assisting 21 destitute villages. Cao Shengzu, Party chief of one of the companies, Longyun Foods, explains that the organization attracted investments totaling 40 million yuan (U.S. $5.83 million) from 800 families to promote its own development. In return, it has pledged to give each of the investors a yearly dividend of 3,000 yuan (U.S. $437) over three years.
Across 12 counties in Dali there are a total of 316 enterprises involved in the mutual assistance program, along with 300poor local households, notes Shi Yubing, director of the prefecture’s Poverty Alleviation Office. The companies have attracted 534 million yuan (U.S. $77.8 million) in investments from 16,986 families, while bringing increased incomes to 26,682 households in return and directing 34.33 million yuan (U.S. $5 million) to the development of the villagers. By the end of 2016, the investing households had received dividends totaling 59.19 million yuan (U.S. $8.6 million), averaging out at 3,484 yuan (U.S. $508) per family.
Model 4: Local Companies Recruiting Impoverished Villagers
A female worker in Yunnan [yunnan.cn]
In the county of Xiangyun, poor villagers can choose to work at enterprises close to their home. Through the anti-poverty program, Li Jiasheng, a local community member, has become a regular employee at Yunnan Xiangyun Feilong Recycling Technology, earning a monthly income of 3,200 yuan (U.S. $466).
Yao Chunbin, director of Yunnan Xiangyun Feilong Recycling Technology, explains that the organization recruited workers from 182 disadvantaged families last year, with a further 1,500 to 3,000 individuals to be trained and employed in 2017.
To eliminate poverty, the first target should be igniting and strengthening people’s ambition, Yao observes. In combination with targeted anti-poverty efforts initiated by the government, his organization has launched training sessions to teach skills to the poor and give them the motivation to forge ahead. The aim is to change their mindset from passively relying on aid to striving for a better life.
