Fujian Province, on the southeastern coast of the People’s Republic of China (PRC), is more than 80% hills and mountains. It underwent rapid economic growth in the few decades prior to project appraisal in 2003. But the standard of living of its rural households had remained much lower than that of its urban population. Limited access to income opportunities, infrastructure, and support services underpinned the persistent rural poverty. Land in the areas where most of the rural poor lived had also been prone to severe soil erosion and degradation due to unsustainable land management practices. Medium- to long-term financial resources to support agricultural and rural development had been severely limited, posing a major challenge to the Fujian provincial government.
The principal objective of the Fujian Soil Conservation and Rural Development II Project, approved by the Asian Development Bank (ADB) for an $80 million loan in April 2004, was to narrow the disparity between urban and rural incomes by improving and diversifying the income opportunities of the rural households. Building on an earlier ADB-financed project, the Fujian Soil Conservation and Rural Development Project, which covered the eastern coastal counties, this project was to focus on inland mountainous areas and a few coastal counties. Its planned outputs included rehabilitated orchard farms and forest areas, developed aquaculture, established agricultural markets, improved agro-processing capacity, integrated livestock farming, developed small hydropower and water supply schemes, rehabilitated small-scale rural infrastructure, and project management support.
In total, 102 subprojects were implemented in 38 counties, including 22 provincial government-designated poor counties. Upland orchards and farms on areas prone to soil erosion and other land degradation impacts were rehabilitated or developed. Aquaculture farms, including for sea shellfish, seaweed, and marine fish culture were established in less-developed coastal townships. Abalone and oyster culture, as well as freshwater fish growing subprojects were dropped after the midterm review because these activities involve high capital investment and increase the risk of typhoon and freshwater pollution.
Three large wholesale markets and four small to medium-sized markets in strategic locations were constructed, expanded, and/or modernized according to good environmental practices and standards. Local agro-processing capacity was improved through a range of primary processing (e.g. preservation, classification, and packaging of vegetables) to intensive processing (e.g. clam powder seasoning and honey wine) subprojects. Five established beef, swine, goat, chicken, and duck rearing and breeding enterprises were expanded and integrated with feed mills, breeding stock, slaughterhouses, and processing facilities. Small hydropower schemes were rehabilitated, rural water supply systems were improved and/or expanded, and so were rural roads, flood levees, drainage, and street lighting.
Because of the project, increased and diversified livelihood and income opportunities became available in the project sites, benefiting about 739,000 rural households with pre-project incomes below the average levels in the prefectures. Poor households accounted for about 15% of the beneficiaries and about 52% of the ADB loan-financed subprojects in the poverty counties and villages. About 80,500 jobs, including 16,322 full-time ones were generated. At project completion thus per capita income was 2.6–2.7 times that before the project. The project contributed around 25% to 31% of the income household gains among the beneficiaries.
The sustainability of these income and poverty reduction initiatives is likely with the backward and forward linkages established in the local economy and the active participation of the private sector in the economic undertakings spearheaded by the project. Poor farmers who previously lacked access to the market gained from the market linkages provided by the private sector. Private enterprises provided credit, technical assistance, and price guarantees for farm products. They also invested in farming outfits and rural infrastructure that helped diversify and expand rural production and economic activity.
The Fujian Provincial Goverment, acting through the Fujian Commission of Rural Affairs, was the project executing agency. Prefecture and county governments were the implementing agencies for all the subprojects.
