China’s ‘two sessions’ 2024: long-awaited reform for 300 million migrants could open wellspring of demand

China’s premier has laid the groundwork to provide urban residency to migrant workers, an estimated 300 million people and a bedrock for growth

City residency would give access to better social services, and, analysts think, the kind of stability which would lead to more spending

Reading Time:3 minutes

Migrant workers, long a backbone of the Chinese economy, would get access to urban residency and public services under the proposed reform. Photo: AFP

Published: 2:50pm, 6 Mar 2024

China is mulling providing equal social benefits for its 300 million migrant workers, a move that would grant that group the same level of coverage as urban residents and, the country hopes, open a previously untapped repository of domestic demand – highly sought after as a means of avoiding economic slowdown.

Creating incentives for migrants to settle down in cities and providing them with same entitlements would be a priority for the Chinese government this year as they represent a vast pool of potential investment and spending, Premier Li Qiang said in his government work report on Tuesday.

Those workers helped propel China’s economic rise but, because of the hukou – the national household registration system – had no access to the superior social services enjoyed by their city-dwelling peers. They are expected to be a force in the next stage of the country’s urbanisation, which still has “much to be achieved”, Li said.

“As a matter of priority, we will move faster to grant permanent urban residency to eligible people who have moved to cities from rural areas,” the premier told delegates of the nation’s top legislature and advisory body during their annual gathering, known as the “two sessions”.

This will help China generate more effective demand to prop up the economy, which is struggling with plunging exports and a property market crisis, said Huang Shouhong, director of the State Council Research Office and head of the drafting team for the report.

“The consumer demand brought about by a person moving to the city is much higher than that of rural residents,” he said while elaborating on the report to the media on Tuesday.

China reported a gross domestic product growth rate of 5.2 per cent last year after an uneven post-pandemic recovery, beating the official target of around 5 per cent. It kept the same target this year, widely seen as an ambitious goal considering the comparatively higher annual base and various challenges the economy is facing.

China’s ‘two sessions’ 2024: long-awaited reform for 300 million migrants could open wellspring of demand

China’s premier has laid the groundwork to provide urban residency to migrant workers, an estimated 300 million people and a bedrock for growth City residency would give access to better social services, and, analysts think, the kind of stability which would lead to more spending

China’s premier has laid the groundwork to provide urban residency to migrant workers, an estimated 300 million people and a bedrock for growth

City residency would give access to better social services, and, analysts think, the kind of stability which would lead to more spending