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Poverty mainly remains a problem of people living in the rural areas: out of 161 million people estimated at or below

the $1 a day consumption in 2002, some 99% lived in rural areas. Rural poverty started to concentrate in the north-west part of China with a high proportion in minority, mountain and border villages. More than 60% of the Chinas poor people lived in the western part and among country level administrative institutions, 40% of poor countries are in the western region with 55% of the poor population of China. The poverty situation in the north-west regions bears some peculiarities, apart from average disadvantages faced by poor regions, such as high birth rates, low per capita income, low labour quality and backward infrastructure, the natural conditions and ecological environment in those poor regions are very fragile. Hence, I agree that Northwest China location is the root cause of its poverty. The natural factors leading to poverty in the north-western regions in China include the climatic, topographical and geographical conditions which are influenced by its location. The arid west has limited rainfall; northwestern have large area of deserts and suffers frequently from landslides and flooding during rainy seasons. Disastrous climatic conditions such as drought, water-logging, frost, wind and sand hit the countrys naturally less-blessed regions. The single most obvious contributor to minority poverty is the geography especially in the mountainous regions. For example in Guangxi, Zhuang occupy the less fertile karst regions of the northwest and the Yao occupy the most remote of the karst regions. These places are not suitable for farming; hence the people are not able to earn revenue from agriculture that leads to their poverty. The proportion of poor people living in the western regions increased from 48% to 63%. Given the low population density in the northwestern region, the poverty incidence was much higher than the national average. For example, 17% of rural population in Qinghai, 15% in Tibet, 14% in Ningxia and 13% in Inner Mongolia lived under the poverty line in 2001 (the national poverty rate being 3.2%). Another pocket of poverty is the Northern China plain including Henan, Hebei, Shanxi and Shaanxi where the poor account for 22% of the national total. This is evident to show that poverty is concentrated in the North West china where these regions are considered more remote and are the arid and mountainous regions, unsuitable for agriculture. In addition, Chinas north-western provinces location is land-locked and separated from the highly accessible Chinese core in the East. The villages of poverty stricken countries are typically separated from regions with modern manufacturing industries and wealthy consumer markets by long distances, insufficient infrastructures or natural barriers, such as mountains, deserts, swamps, or mighty rivers. The trickle-down effects of the spectacular economic growth in the coastal areas did not reach the more remote parts of the country such as the northwest regions. The poverty-stricken mountain areas are always in disadvantaged position in attracting investments. Besides poverty-stricken mountain areas are mostly in frontier areas, which are far from political and economic center of a region or a country, and become a marginalized zone. As a result of its location, Chinas north- western region remains behind other areas of country in economic growth. This part of China has received only 3% of the nations total foreign direct investment. Economic growth of the western region was 1.7 percentage points slower than the national average between 2001 and 2005. There were 57 million people with annual per capita income below 958 yuan (about US $126) in the north-west part of china rural areas at the end of 2006. There are other accompanying factors that amplify the disadvantages that Chinas northwestern regions have caused; one such factor is the lack of basic infrastructure. As a result of north-western part of China regions, the lack of basic infrastructure aggravated the poverty issue in these regions. As the north-western regions are located in remote

places far away from economic centers, they are geographically disadvantaged and isolated from the outside world due to the lack of infrastructure developed in these areas, hence the poor transportation disallowed the contact with the prosperous regions in China, accentuating poverty in the north-western part of China. Farmers in the rural north-western regions are plagued with constraints in the nature of their physical environment, market infrastructure and finance. Rural infrastructure has seen major improvement over the past decades particularly in transport, irrigation and flood control. Since 1985, the government has given high priority to road development, particularly the construction of high-quality roads such as highways connecting major industrial centres in coastal areas. In the 1990s, investment in infrastructure became a national priority and infrastructure became a national priority and various policies were implemented to promote the rapid construction of highways. However, the length of low-quality, mostly rural roads increased very little, by only 3% per year over the same period. This has resulted in the rural poors lack of access to product and factor markets, which leaves them largely bypassed by the growth process. Moreover, these complementary reforms in related service industries, such as local trucking, are lagging behind the pace of capital investment. As a result of the lack of infrastructure, many farmers still remained challenged by the environmental problems such as land degradation in the forms of water erosion and desertification and water pollution due to their natural location. Market infrastructure is constraining farmers in localities where market information is scarce, and marketing services not available. Hence, lack of infrastructure aggravated the poverty issue in north-western China. Together with the fundamental problem of its location, these served to accelerate process of irreversible poverty problem in north-west china.