Although China is rising in the UN’s human development league tables, growing inequalities have left Guizhou ranking alongside Namibia whereas Shanghai is more comparable to Portugal, according to the UNDP 2005 Human Development Report, International Cooperation at a Crossroads: Aid, Trade and Security in an Unequal World, published in early September.

Inequality is a major theme coming out of the report, which argues that social and economic disparities within and between countries weakens political legitimacy and undermines development gains. China is cited as an example of a country where inequality is growing.

The report ranks countries by a composite human development index that draws on GDP, health and education indicators. China is ranked 85 out of 177 countries, 20 places higher than in 1990.

In terms of the GINI coefficient, which measures inequality of income distribution, the report again gives China an approximate mid-table ranking: more unequal than the USA, but not as unequal as a clutch of Latin American countries. According to the report, the poorest 10% in China own just 1.8% of the wealth whilst the richest 10% control 33.1%.

Although rankings are given for countries as a whole, occasional references to disaggregated data offer some striking examples of imbalance within countries. One such example places Guizhou, long recognised as China’s poorest province, on a par with Namibia (ranked 125 on the index) whilst Shanghai ranks alongside Portugal (ranked 27).

Attention is also drawn to inadequate health care threatening development gains in China. The authors note that the under-5 mortality rate in Guizhou is almost 8 times higher than in Beijing and Shanghai, attributing this and other health inequalities to “a privatized health financing system that seems inappropriate in a country with high levels of poverty.”

Khalid Malik, UNDP Chief Representative in China, joined the calls for a more equitable health system during the report’s Beijing launch, saying that the absence of health insurance “is responsible for thousands of unnecessary infant deaths each year.” The report notes that China currently spends 5% of GDP on health care of which less than 2% comes from the public purse, and that many of the sick opt not to seek medical treatment owing to its cost.

Despite the attention drawn to development imbalances, the report also reveals that China still ranks higher in human development than in global GDP league tables. This is attributed largely to achievements in primary education enrolment and literacy rates above 90%.

Aid, trade and conflict are the other major themes discussed in the report, which calls on developed countries to fulfill promises to achieve the Millennium Development Goals through fairer trade, better quality aid, and by meeting aid contributions.

The report argues that balanced development matters not only for the sake of social justice but also for social cohesion. It also includes a poignant reminder that the 20th century was the most violent ever: 4.35% of deaths were conflict-related as opposed to 1.65% and 0.3% in, respectively, the 19^th and 16^th centuries.

The full report, which comprises 388 pages of data and analysis, is available in full at www.hdr.undp.org

Report by Matt Perrement, September 16 2005