Economic Watch: China drives farmers' income growth to expand demand, bolster economy

BEIJING, Feb. 6 (Xinhua) -- Zhu Yanfen spent decades farming in her rural hometown in southwest China's Yunnan Province, once relying on traditional crops and the weather to make ends meet. Now employed by a local agricultural company, she grows specialized produce and earns significantly more -- over 10,000 yuan (about 1,437 U.S. dollars) per month during the busy season.

Her story reflects a nationwide drive to promote steady income growth for farmers, one of the priorities outlined in a key policy document released by China's central authorities on Tuesday, which outlined plans to advance agricultural and rural modernization and promote all-around rural revitalization this year.

In the document, China commits to safeguarding and incentivizing farmers' participation in grain production, cultivating county-level industries that benefit rural residents, stabilizing employment for rural migrant workers, and implementing measures to expand rural consumption.

These measures will serve to improve people's livelihoods, boost consumption, and energize the broader economy from the ground up, analysts said.

STRENGTHENED EFFORTS, DIVERSE CHANNELS

Official data showed that rural residents' per capita disposable income reached 24,456 yuan in 2025, up 6 percent year on year.

While progress has been made, challenges remain for sustaining income growth, as prices of some agricultural products stay low and pressure on stable employment for migrant workers persists, noted Zhu Weidong, deputy head of the Office of the Central Rural Work Leading Group, at a press conference on Wednesday.

Zhu said measures, including minimum purchase prices, planting subsidies, and crop insurance, will be strengthened to secure farmers' incomes from grain production. Meanwhile, to raise rural residents' wage income, efforts will focus on improving services for migrant workers and expanding support for those seeking jobs or starting businesses in their hometowns.

"Conditions will be created to increase farmers' property income through multiple channels," Zhu added.

One way is to promote the development of county-level economies, each with its own distinctive features.

County economies encompass not only county-seat economies but also township and village economies across multiple tiers. Once focused mainly on agriculture, counties are now pursuing far more varied growth patterns.

Zhu emphasized fostering industries aligned with local conditions and comparative advantages as an important pathway to raising farmers' incomes.

Some counties are already piloting industries such as ice and snow tourism, e-commerce promotion, specialized tropical farming, and deep agro-processing. These diverse business models and extended industrial chains are creating jobs and raising incomes for rural residents.

"A fair distribution mechanism should be refined to achieve a virtuous cycle between industrial development and growth in farmers' income," noted Zhu.

EXPANDED CONSUMPTION, UNTAPPED POTENTIAL

Rising income for farmers not only signals a better livelihood but also serves as a fundamental driver for expanding rural consumption and strengthening domestic demand, a cornerstone for China's high-quality economic development, experts said.

Zhong Yu, a researcher at the Chinese Academy of Agricultural Sciences, said that rural residents' income is a relatively weak link in the national income structure, and unlocking this potential is essential for balanced, high-quality national development.

"A steady and sustained increase in farmers' income holds important significance for China to move toward a high-income economy," Zhong said.

This potential is underpinned by the substantial size and consumption propensity of the rural workforce. According to the National Bureau of Statistics, the number of rural migrant workers in China stood at nearly 300 million by 2024.

Lu Ting, chief China economist at Nomura, noted that this group tends to have a higher marginal propensity to consume, meaning that any growth in their income directly and significantly fuels consumption.

Official data has already demonstrated this momentum. In 2025, rural retail sales rose to 6.8 trillion yuan, up 4.1 percent year on year, outpacing the 3.6 percent growth in urban areas.

To further tap into this potential, the key policy document stressed the importance of boosting rural consumption. It calls for upgrading consumption infrastructure, such as logistics networks, and promoting new energy vehicles, smart home appliances, and green building materials in rural markets.

"With the sustained development of the rural economy, the continuous increase in residents' income, and the evolution of consumption concepts, the demand among rural residents for various products and services will continue to expand," said Tu Shengwei, a researcher at the Chinese Academy of Macroeconomic Research.

When hundreds of millions of farmers achieve modernization together with the rest of the country, it will unleash tremendous development momentum and consumption potential, said Han Jun, minister of agriculture and rural affairs. ■