"While 40 years ago, not even 20 percent of Chinese citizens lived in the city, today the number has risen to 50 percent. By 2020, it is expected to rise to 60 percent," Sieren writes. "For the first time in 30 years, the number of internal migrants in China sank last year—by about six million. To a certain extent, this is due to the country's demographic development—there are simply fewer migrant workers because of lower birthrates. In addition to this, the Chinese government has also acknowledged that a two-class society has emerged in the huge metropolises of China because of the hukou system which requires each citizen to be registered in a family register and makes moving within China illegal. A sort of caste system has come about in cities, turning internal migrants into second-class citizens who often have no access to social services, healthcare or schools for their children." (Advisor Perspectives graphic)
In Western China, the central government "is supporting the idea of 'rural start-ups' more than ever," Sieren writes. "Some 40,000 people returning to the southwestern province of Sichuan have registered new businesses. This is not a bad means of opening up new growth opportunities for the Chinese economy and strengthen domestic growth."