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Chinese farmers' income growth is expected to slow in the second half, due to continued falling prices for grain and livestock, and the steadily rising prices of farming materials.

 

Falling grain prices and higher production costs would reduce average net income by 30 to 50 yuan (US$6.3), said a report from the National Commission of Development and Reform (NDRC) on Monday.

 

Meanwhile, without new favorable policies, political factors are expected to contribute less to the income growth of farmers, said the report.

 

The income gap between China's rural and urban areas is still widening, according to figures released by the National Bureau of Statistics.

 

During the first half, the average cash income of farmers grew 11.9 percent from the same period last year to 1,797 yuan, 0.6 percentage points lower than the same period last year; while the average disposable income of urban citizens grew 10.2 percent to 5,997 yuan, 0.7 percentage points higher.

 

The NDRC report also predicts housing prices will continue to rise. As a result, income growth of urban residents will be affected and low-income families are set to suffer more financial pressures.

 

(Xinhua News Agency August 1, 2006)