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China sounds alarm over fast-growing gap between rich and poor

AP 11may02

BEIJING -- In an unusually frank assessment, a top Chinese planning official warned that the gap between rich and poor in China is rapidly widening and could threaten national stability.

In just 20 years, China has gone from having virtually no income gap to having one of the world's biggest, Lu Zhiqiang, deputy director of the government's Development Research Center, said in a speech Thursday at the Asian Development Bank's annual meeting in Shanghai.

"The problem of income distribution has become the most noticeable issue among current social problems in China," Lu said, according to an account of his speech posted on the official People's Daily Website on Saturday.

About 70 percent of Chinese think the wealth gap has harmed social stability, he was quoted saying. No details were given about the origins of that figure.

"People are showing great discontent with the irrationally high income gained through the monopoly of industries, and with the legal gains derived from graft and corruption, and power-for-money transaction," he said.

China frequently touts the enormous progress its economy has made since the Communist Party introduced reforms in the late 1970s. Officials rarely mention growing social and economic inequalities.

Most Chinese have seen tremendous improvements in their quality of life over the past two decades, but China's coastal areas have absorbed the bulk of foreign investment and grown most rapidly while the interior has lagged.

Closures of decrepit state industries and stagnating rural incomes have sparked protests by laid-off workers and impoverished farmers. Meanwhile, resentment is growing over abuse of power and rampant corruption among high officials and well-connected businessmen.

Rising unrest has rattled the party, which came to power on a program of revolution but which now styles itself the guardian of stability. Leaders have been unwilling to institute political and legal reforms that could boost accountability and weaken the party's political monopoly.

The ineffectiveness of the legal system and economic levers make it hard to reverse the worsening trend in income disparities, Lu said.

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