Posts Tagged ‘Peasants’

Yup, rural China is still out there

August 15, 2011

It’s hard to believe I’m already nearing the three- month mark for my return to Beiijing.

Near a Teach For China placement school. I admit I didn't take it, but pretty nonetheless...

Work at Teach For China has been pretty exciting thus far; the work is really fast-paced, the office full of smart and motivated people rushing around in an attempt to get too much done in too little time. My first grant proposal, written frantically in my first week of work, unfortunately failed; the Canadian Embassy’s charitable fund decided this year to focus on women’s empowerment. However, the mild disappointment at this has been almost completely lost in the flurry of other new and exciting work. The Development team’s fall fundraising campaign is starting in earnest next week, and I’ve recently been anointed manager of Teach For China’s social media campaign. I blame this new gig primarily for my lapse in maintaining regular blog updates; tweeting is considerably more time-consuming than I ever would have guessed, and it’s hard to convince myself to sit and type at a co outer in my free time when I already do it from 9-6 Monday to Friday. In the absence of regular updates here, I instead make a shameless plug for the Teach For China WordPress, which I’ve now been updating with regular stories from teachers’ (called Fellows) lives in Yunnan. I’ve been gathering really great stories from their lives in the boonies, with great pictures to boot.

Though I’ve settled for now back in the big city, I was inspired to write this post the other day by a sudden reminder of my time in Sichuan. Devoted readers will remember Qiu Yukun, my friend in the rabbit-raising business who during my time in Sichuan tried to rope me into scheme of starting a restaurant in his hometown. He continued to try to sell me on this idea right up until I left Sichuan; and I, unsure of how to deal with the situation, continued to give him noncommittal responses right up until when I returned to the US. When I returned to Beijing this time, I sent him a text, but by then he had already switched phone numbers, and I feared I had lost touch with him for good. Then last week I happened to sign into QQ (the Chinese instant messenger) and to catch him online.

It really was quite a stroke of luck that I managed to run into him; Yukun rarely used QQ, and I hadn’t signed into the Chinese chat program since leaving Sichuan over half a year ago. Yukun was ecstatic to find me. When I met him last year he was already married, but I was shocked to hear that, in the time since I had left, his wife had given birth to a son. In the two years since graduating college, most of my friends have started some kind of graduate school, and only a tiny handful have gotten married; in the last couple of months, I’ve been so proud of myself for crossing such major milestones to adulthood like renting an apartment, and having a kitchen with actual pots and dishes. Speaking to Yukun was a jarring reminder of how, in a place like Yilong, Sichuan, real adulthood comes along a lot more quickly.

We exchanged phone numbers again, and since then, he’s called and texted repeatedly, but mostly during work hours and I, guiltily, sent only apologetic text messages in response. Today I happened to be already out the door of the office as his call came through. “Finally, you answered!” he exclaimed, but our exchange of pleasantries was followed by an awkward pause in which neither of us new quite what to say to each other. “When are you coming back to Sichuan?” he asked, and I struggled to find a diplomatic answer. I would, of course, love to go back, but as a real person with a real job now I only get a limited number of vacation days a year, and will inevitably spend many of those visiting family in the US. Yukun seemed equally uncertain of when he would have a chance to return to Beijing—he previously worked here has a migrant worker for several years, but now he has a family and a farm to take care of. “You should hurry back, I can introduce you to a nice girl to marry here too!” he insisted, and rattled off the appealing traits that I must surely be looking for in a future wife. “I know some very pretty ones, very tall, and with light skin!”

The conversation had the same anxious air that I remembered from conversations with him and some of my other friends in Yilong. I’m still the only foreigner he knows, and must still represent his only window into the larger world outside of rural northern Sichuan. As I’ve written about before, Yukun was one of several friends in Yilong who, throughout my time there, was constantly approaching me with new schemes of how we could go into business together. He seemed certain that I was the secret to getting rich quick—either as a source of American investment capital for his restaurant scheme, or simply as a front man who would attract business simply by virtue of being white. Somehow, as a foreigner, I represented an elusive alternative to the rather dismal choice that most young people in rural China face: stay at home and farm for menial gain; or live the hard but comparatively lucrative life of a migrant worker.

Unfortunately, the chances of my becoming the financial backer for his restaurant are pretty slim. I thus attempted to deflect his invitation politely, not wanting to get his hopes up. “I really want to come back to Yilong, I’m just not sure when I will have time,” I urged. Though I really meant it, the words sounded hollow, even to me. I suddenly remembered the attitude he and some of my other friends had taken on the day I left. I had insisted then that I would certainly come back, but many had seemed skeptical; foreigners had always passed through periodically, to teach English, or volunteer with Wokai or another international charity, but then they returned to their own lives. I realized that, just as Yukun was desperate to maintain a link to the outside world through me, so I, a suburban Midwesterner, want desperately to maintain some connection to his world, which I gained access to for a short period of time but even now remain intensely curious about.

I hope you can maintain a friendship on that.

The End of Microfinance’s Honeymoon

January 17, 2011

ARDY's Fu Xing branch office

I’m a couple of weeks late, I know, in commenting on article in the New York Times about the recent image issues that the microfinance industry has suffered. The article describes how major microfinance lenders, in particular in South Asia and in Latin America, have begun to come under greater public scrutiny, and even resistance, from the media and from political leaders. In the most extreme example of resistance, the government of the Indian state of Andhra Pradesh has banned microloans altogether.

…as with other trumpeted development initiatives that have promised to lift hundreds of millions from poverty, microcredit has struggled to turn rhetoric into tangible success.

Done right, these loans have shown promise in allowing some borrowers to build sustainable livelihoods. But it has also become clear that the rapid growth of microcredit — in India some lending firms were growing at 60 percent to 100 percent a year — has made the loans much less effective.

Most borrowers do not appear to be climbing out of poverty, and a sizable minority is getting trapped in a spiral of debt, according to studies and analysts.

…even as the results for borrowers have been mixed, some lenders have minted profits that might make Wall Street bankers envious. For instance, investors in India’s largest microcredit firm, SKS Microfinance, sold shares last year for as much as 95 times what they paid for them a few years earlier.

The article confirms something that we probably should have known all along–that an organization isn’t necessarily doing good for a community just because it labels itself as “microfinance”–rather, effectiveness is inevitably going to vary by organization and each microfinance firm must be evaluated individually in order to determine its effectiveness. In my experience, the Association for the Rural Development of Yilong County is one of the better-run organizations, and its successes carry lessons for both implementing microfinance successfully, and for evaluating the reliability of other organizations.

In the last month of my time in Sichuan ARDY hired an outside software distributor from Nepal to help them install a new data management system–something I’ve blogged about previously here. The two men who came in from Kathmandu to oversee the installation process had been to China several times before to work with other microfinance firms in various parts of the country. When I asked them how ARDY compared to the other Chinese firms they had worked with though, they respondingly responded that ARDY was quite different. Many of the other organizations, it seemed, fell into the same pattern that the article describes as inspiring suspicion. They ran their operations strictly as a business, beholden primarily to the profit motive, and with little concern as to whether their borrowers were really being lifted out of poverty. ARDY, they said, was the only Chinese microfinance distributor they had seen which was really motivated by social goals, and which really worked to change peoples’ economic situations.

As I have discussed previously in this blog, one of ARDY’s really unique characteristics is its organic relationship with the local community. Gao Xiangjun and the other directors all grew up in this community, and have a strong sense of personal dedication to improve it. They know what local inhabitants need and are personally dedicated to providing them with the instructive and material support that they need. However, I was equally impressed by the shrewd business acuity which Gao and her colleagues display in their work. ARDY maintains an incredibly high repayment rate, and reinvests much of its profits from interest back into the organization, such that its lending pool increases each year. How can an organization combine both profit motive and social good?

I think one important element is the need to distinguish profit motive from profit as a performance indicator. ARDY seeks to help local farmers by creating sustainable local enterprises which borrowers will be able to manage and develop themselves. Traditional indicators of business performance, in particular profit, are the best way to determine if borrowers are in fact moving toward financial independence rather than simply accepting handouts. They should also inform the way in which potential microfinance entrepreneurs manage their new enterprises, and ensure that they can eventually turn a profit on their own.

However, in order for these more conventional business practices to be successfully integrated into a community which previously lacked them, they must be combined with an intimate understanding of the community and a willingness to work with borrowers to overcome the greater obstacles that inevitably arise from starting a business in a more extreme environment. When a borrower from ARDY fails to make a payment, a loan officer visits them at their home, and works with them to figure out a strategy for repaying the loan and, hopefully, salvaging their failed business endeavor. Without this sensitivity to local conditions, any organization that treats profit as its bottom line is inevitably going to leave some people behind. Instead, profit motive should inform socially motivated projects, allowing an organziation to meet its social goals within a competitive capitalist environment and with a more efficient use of resources.

What does the future hold for rural China’s small-scale family agriculture?

December 21, 2010


A small family plot

A few weeks ago I posted an entry about the Association for the Rural Development of Yilong County’s efforts to organize rural cooperatives in Yilong, and argued that the “problem of scale” is one of the main challenges facing Yilong’s farmers.  Most families occupy the small parcels of land which were redistributed to them after Deng Xiaoping’s reforms broke up the collective farming system in the late 1970’s, amounting to about 2-3 mu 亩, or 1/5 of a hectare, each. While this provides enough land to meet many of the family’s own immediate nourishment needs, it leaves little room for families to produce a surplus that they would be able to sell effectively on the market. Furthermore, each family is traditionally responsible for all of the input costs for their own production, such as their own seeds, fertilizer, and pesticide. The need to meet each of these costs individually means that the marginal profit that each family is able to gain from the sale of surplus agricultural goods is quite small, and the additional costs associated with bringing the products to market—such as transportation—often make commercial farming not cost-effective.


Having studied Chinese history in college, my discussion with Gao Xiangjun about the reasoning behind the Rural Mutual Cooperatives made me first think of the historic roots of economic dilemmas that Yilong’s peasants face. After all, the United States had also once been a nation of small-scale farmers. What had happened in the United States that could not happen in China?

Over the course of the late 19th and 20th century, many small-scale American farmers sold their lands and sought urban jobs, leading to the rapid expansion of a small number of farms that were able to manage agricultural production on a large, industrialized scale. However, a number of social and political barriers in China prevent agricultural consolidation in the same way. First of all, under the Chinese government’s current legal property regime, all land is technically owned by the state, while current occupiers of land can only buy and sell long-term leases of the land’s use. This makes buying and selling land for the purpose of consolidation more difficult.

In addition, while a large number of Yilong’s peasants travel to cities annually to find work, a number of barriers make it incredibly difficult for them to move there permanently. Probably the most insurmountable of these barriers is the Chinese hukou system of residency permits, which the government instituted in part to prevent a massive rural exodus that would strain urban infrastructure. Without owning an urban residency permit, which is incredibly difficult or incredibly expensive for non-natives of Chinese cities, it is impossible to get access to urban government services such as health care and education.

Moreover, my experience in Sichuan has taught me not to underestimate the power of Chinese family ties as a guiding social force here. While I have met many people in Yilong who spent many years working outside of Sichuan, often hopping from one Chinese urban center to another in search of work, they all eventually moved back home in order to be close to family. Many people in Yilong are quite confused when I explain to them that my family, not atypically of American middle class families, is quite spread out. My parents live in one city, their siblings with their families and children in different cities, my grandparents in another city entirely. Most of the families whom I have met in Yilong have occupied the same several mu of land for several hundred years and uncounted generations. The idea of permanent dislocation from their ancestral homeland seems for many families to be out of the question.

These barriers to agricultural consolidation raise some interesting questions for the future of economic development in China. Without major overhauls to some of the fundamental underpinnings of the current social and political system, it will be impossible for rural areas in China to follow the same pattern of rural to urban migration and consolidation of farms which worked for the United States and so much of Europe. Only on such large-scale farms does the adoption of more sophisticated farming equipment and chemical fertilizers and pesticides become economically feasible, and thus make possible the huge increases in agricultural productivity which American and European farms experienced during the twentieth century. Can the region continue to grow economically without an increase in agricultural productivity?



Empowering Entrepreneurs through Microfinance

December 9, 2010

I paid a visit a couple of weeks ago to Zhang Rong, the hot pot entrepreneur and microfinance borrower whose photo has long graced the Wokai website. Mrs. Zhang operates her hot pot stand across the street from the ARDY branch office in the town of Yong Le, while her husband works up the street at the local power station. Her older son, who is 21 years old, works as a car mechanic in Chengdu, while younger son, 18, is currently a senior at Yongle High School.

Mrs. Zhang and her husband moved to Yongle from the countryside in 2001. When they first came here, Mrs. Zhang worked as a cook at the power station where her husband still works. In 2005 they started construction on the building which currently houses the hot pot shop on the ground floor and the family’s residence on the second floor. The concrete building was completed at a total cost of around 20,000 RMB and paid for in part by a micro loan from ARDY.


With her husband away at work all day Mrs. Zhang runs the entire shop by herself, even during the evening rush.

Mrs. Zhang’s stand is famous for its Ma La Tang 麻辣烫, a type of hot pot consisting of vegetables and some meat which is sold by the skewer (at 0.5 RMB apiece) and then boiled in a spicy broth. Mrs. Zhang makes her own broth from chili peppers, Sichuan peppers, and various other seasonings; I tried to get the exact recipe from her but was unsuccessful. Many people who sell food for a living here are protective of the secrets of their business, for fear of inspiring more competition.


In the years since first opening her own shop Mrs. Zhang’s business has increased significantly. In addition to the classic hot pot she now sells fried hot dogs on skewers for 1RMB each and bubble tea for 1 RMB a cup. The profit margin on all of her products is quite slim; the hot dogs cost her 0.8 RMB a piece to purchase, leaving her with only 0.2 RMB profit. She caters mainly to students from the three middle and high schools in the town, which swarm her stand during break time, especially after their evening classes end at 9pm.

On the Saturday afternoon during which I spoke with Mrs. Zhang, two regular customers, students at the local middle school, had just showed up for a snack before going shopping. The two girls lingered at the shop, sipping on bubble tea and munching on sausage skewers as they chatted with Mrs. Zhang before sitting down to a bowl of hot pot. Mrs. Zhang mothered over them, urging them to eat more vegetables.

With their own home and a stable business, the Zhang family has a fairly comfortable life in Yongle. Through their own relentless hard work was doubtlessly the most important factor, microfinance also played a role in helping them to become successful rural entrepreneurs.

Bringing Microfinance Technology to the Countryside

November 30, 2010


ARDY staff members check the new digital loan records against paper backup records

The ARDY office is all abuzz this month about an impending switch to a completely new software system to manage all of the organization’s microfinance data. A representative from a Sino-German microfinance consultant, based in Beijing, as well as from a Nepal-based software distributor, are both spending the month in Jincheng to oversee the switch and train the staff on the new system’s operation. The new software, called Microbanker, is a powerful example of international development collaboration. It was originally developed by the UN Food and Agriculture Organization’s Asia division, in Bangkok, in collaboration with the German technology firm GTZ. Microbanker of Nepal, the nearest distributor, has successfully installed the software in 37 different countries.


The software has the potential to dramatically increase the efficiency of ARDY’s operations as well as make future expansion and modification of the model much faster and cheaper. While each of ARDY’s branches currently manages the data for its own set of loans entirely locally, making it impossible to access that data from the central branch or from other branches, the new system will connect each branch to an internal network to make all of the organization’s loan data accessible from anywhere.

So good so far, right? Of course, installing an entirely new software system on computers spread out throughout seven different remote towns in mountainous rural China is easier said than done. Observing this process of bringing state-of-the-art technology into rural China, and many tiny snags encountered along the way, has been an interesting experience.

The installation process is an interesting case study in international cooperation. The two Nepalese consultants learned fluent English from a young age, and need the Chinese consultant from Beijing, who speaks good English, to communicate with the ARDY staff. It has been gratifying to feel useful as a miscellaneous interpreter when the official translator is busy.


Mcgyvering a power strip

A couple of weeks ago I travelled with the outside consultants to the Yong Le branch and watched as they connected the branch’s computers into the new software network. Before long, the tiny concrete storefront was bristling with extra wires and Ethernet cables. Luckily, there was a clever local solution for organizing the wires; one of the loan officers disappeared and returned with a plain length of steel pipe, into which all of the wires were threaded. When the wire on the surge protector they were using proved too short to fit through the wire, the loan officer vanished again and returned with a longer wire, then proceeded to take the surge protector apart, strip the insulation of both ends of the new wire and put the surge protector back together with the new, longer wire.


Though all of the hardware was finally assembled around noon, when the consultants opened the program they were unable to raise a signal from the main server that they had installed at ARDY headquarters in Jincheng. “We usually don’t get internet around noon,” the Yongle loan officer explained. “It comes on again after about an hour, around 1pm. The same thing happens from 6-7pm.” None of them had any reason why this was the case.


Forrest Zheng, a consultant from Beijing, and Ajay Shrestha, a representative from a Nepal-based microfinance software distributor, hook up the new server at the ARDY branch in Fuxing

On the first day of installing the new software at the branch office in the town of Fuxing, the staff stayed up late, scrambling to finish the initial data migration before the next morning. “They’re turning the power off tomorrow morning,” a Fuxing loan officer told me, “we have to get all of the new data in before then.”


These types of obstacles are rarely predictable, and are the inevitable result of dealing with the idiosyncrasies of a rural setting like Yilong. Watching the installation process has been, for me, a powerful reminder that rural development is inherently an unpredictable and dynamic field.


Folk Myths of Rural Sichuan

November 14, 2010

I spent an afternoon a couple of weeks ago chatting with Luo Jia, the daughter of the family who sells baozi around the corner from the ARDY main office, which led to an interesting discussion of popular “superstitions.” She pointed up the street to a staircase leading down to a lower street, where a well-known witch lives.

A friend of Luo Jia’s from Chongqing married into a family from Yilong a couple of years ago. The previous year, the friend’s younger sister had been crushed to death by a family member’s truck. “They drove her to the doctor, but the truck was so slow, it took over two hours, she had bled out by the time they got her to the doctor.” The friend’s young son had seen the body as they were taking it to the doctor, and thereafter started having regular nightmares, which Luo Jia’s friend attempted to cure by going to visit the local witch. The witch took out a bowl of water and placed it on the table along with two candles. She lit the candles and soon after started to shake uncontrollably, declaring that the spirit of the slain sister had arrived. The witch then lit several pieces of the rough straw paper often used as offerings to ancestors (such as I had seen another friend burn to honor his grandparents) and allowed the ashes to fall into the bowl of water. The friend was then instructed to drink the bowl of water. “After she went home, the next day her son slept with no problem,” explained Luo Jia.

Despite this anecdotal example of the apparent effectiveness of witches, popular mythology is clearly on the edge of extinction in Yilong County. While a few elderly people still hawk fortune readings (算命) on the street at various local markets, only Yilong’s elderly still believe in them. Folk mythology has been under sustained attack in China since the early twentieth century, when peasant “superstition” came to be seen as one of the main factors behind China’s perceived economic backwardness. All of the young people with whom I have discussed the concept, including Luo Jia are disdainful of local superstition. Luo Jia laughed in resignation as she told me about her Gu Ma姑妈, or paternal aunt, who swears by the witch’s advice. “She’s so superstitious, she won’t do anything without consulting the witch first. If she gets sick, and we get her medicine, she’ll ask the witch before taking it. Whenever she has to buy something, or make any decision, she’ll ask the witch first.” And of course any trip to the witch has a consultation fee. Luo Jia shook her head, lamenting the amount of money that her aunt had thrown away on the witch. “She’s so kind-hearted, she’s easily scammed by people like that.” Luckily, regular visits result in a customer loyalty discount.


How to Raise Rabbits

September 28, 2010

This afternoon I visited the home of a prominent rabbit farmer in the town of Dingziqiao 丁字桥, whose successful operation has made him a leader in the community and a major participant in some of the community empowerment initiatives which ARDY runs in the area. His son, Qiu Yukun 秋玉坤, showed me around their rabbit farm, which in seven years of growth has grown into a large operation encompassing several hundred rabbits.

Yukun led me into one of the two large brick sheds on his family’s property, each of which contain two long rows of concrete cages. A small food bowl is wedged into the bars of each cage such that it can be easily removed and refilled, while an ingenious water pump system reaches all of the cages through a series of plastic tubes. The floors of each cage are comprised by evenly spaced bamboo slats, such that rabbit droppings fall through to another level for easy cleaning.

All of the rabbits that Yukun and his father sell for profit come from a select few breeder rabbits which have been selected as yielding particularly good offspring. Used to the rabbits which maraud gardens in suburban America, I was surprised to see that these creatures were several times larger, bigger than the average housecat. Yukun pointed out a couple of their best breeders to me, including one which, because it had been caught in the wild, produced particularly hardy offspring. These prize rabbits, if sold, are worth at least 170 RMB a piece, though a male and female pair can fetch several hundred RMB.

While the breeder rabbits are generally kept in individual cages, male and female rabbits are periodically placed together, “to see if they are a match,” as he explained to me. I watched as he removed several females and placed them in cages with males, but after preliminary expressions of interest none of the rabbits took to one another. Judging when a rabbit is ready to reproduce, and who it wants to reproduce with, is apparently a delicate art which, Yukun explained to me, he had not yet fully learned from his father.

Once one of their breeder rabbits gives birth to a new litter, the offspring are raised to a size of about 4 jin 斤 before being sold to a local slaughterhouse. Yukun explained to me that their farm raises two different varieties of rabbit. One variety, raised for its meat, takes about 2 months to reach the prerequisite size and is usually sold for around 40-50 RMB apiece. A variety with softer, sleeker fur which is used to make clothing takes longer to raise, at least four months, and thus is sold at a higher price.

I was lucky enough to come the day after one of their rabbits had just given birth, and was given a chance to see the tiny babies tucked into a small box of fur and straw.