Social security reforms in China: Issues and prospects

Abstract

The phenomenal success of China's market-oriented economic reforms since the 1980s has rendered the traditional employment-based social security system increasingly inadequate and inefficient. For decades, the Chinese government has been trying to develop a more pluralistic, effective and affordable social security system which will be compatible with both a thriving market economy and a flagging socialist political structure. While the emerging system is still struggling with a variety of operational problems, the entry of China into the WTO is looming as a formidable challenge to this social security system. This presentation outlines the recent reforms of the social security system undertaken by the Chinese government, and assesses the effectiveness of the results in meeting the challenge. Here, social security reforms focus on the retirement and unemployment insurance schemes and the social assistance program.