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STRATFOR.com
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China: Wage Hike Points to Reform Debate
June 11, 2002
Summary
Beijing is raising civil-servant salaries as part of an effort to reduce corruption and attract better-educated people to the government. The pay raise also illustrates an ongoing debate that could impact the country's leadership change later this year.
Image Credit: l'Agence France-Presse (AFP).
Analysis
China will raise government salaries July 1, the fourth pay hike for the country's civil servants since September 1999. The decision has drawn muted protest from some; the official Workers' Daily newspaper has called together a panel of experts to discuss -- and criticize -- the pay raise. According to this group, spending more money on civil servants rather than using it to educate the poor will only exacerbate the widening economic disparities in China.
One of Beijing's goals in raising civil service salaries is to reduce the financial incentive for corruption among government officials and bureaucrats. Official corruption, particularly at local and provincial levels, has tainted the image of China's Communist Party and left the government struggling to regain the people's trust and centralize its control.
The carrot of higher wages is coupled with the stick of the government's ongoing anti-corruption campaign, through which several high-level Chinese officials have been given life sentences -- and even the death penalty -- as clear warnings to other government employees and party functionaries.
(The Rest of the Story)
(c) 2001 Stratfor, Inc.
Dan
China: Wage Hike Points to Reform Debate . . .