Combination of planning and market is solution to wealth gap
Updated 09:40, 12-Dec-2018
Laurence Brahm
Editor's Note: As a lawyer, policy adviser, filmmaker and social enterprise pioneer, Laurence Brahm is not only a keen observer but an active participant in China's reform and opening up. "Laurence Brahm's Diary on China in Change" is a special series dissecting the colossal changes Brahm has witnessed in his 37-year stay in China. In the third episode, Brahm shares his views with CGTN on the wealth gap in China.
CGTN: Given different levels of access to resources, gaps between the middle-class and the grassroots seem to have become increasingly insurmountable. Is it really the case? What should be done to address this issue?
Brahm: The wealth gap is always a challenge. Now it's becoming an increasing challenge globally. 
In the early '80s, the earliest reforms were actually agricultural reforms. However, by the late '80s, the government shifted the focus. So the entire development process, from the late '80s throughout the '90s and onwards, was on urban areas. 
What did farmers do? They came to the factories in the coastal cities, which boomed and grew, and in turn, the farmers became workers. The villages became empty. And soon the women were joining the men and also [became] part of the workforce. So the villages had not only an economic gap but also this huge age gap. This created a lot of social distortions.
So the government looked at the situation: We've got to start to re-balance; we need to re-empower and re-invest into our rural areas. So the government began now, under the current policies with ecological civilization and the Belt and Road, to re-invest into the interior of China. 
That means going into villages and making those villages new urban areas that are called ecological cities. This is where the sort of combination of state-planning with market together is being used to try and create enhanced lives, better living conditions and to be able to develop also a fresh economic model.
CGTN: You once talked about “social enterprise.” What should be done to boost the development of “social enterprise” in China?
Brahm: I worked with Muhammad Yunus (a Bangladeshi social entrepreneur, economist and civil society leader who was awarded the Nobel Peace Prize in 2006 for his efforts in microcredit and microfinance) and others in developing the concept of social enterprise. 
There is no conflict between economy and culture, heritage, [and] environment, if it is managed properly or if it is used in the correct way with the right intention.
And so I was very much inspired by Jigme Jensen (a Tibetan who has invested in local cheese factories since 2000). He was a monk who decided not to spend his time in the monastery, but rather investing in cheese factories across the Qinghai(-Tibet) Plateau. And some of these factories were 5,000 meters above sea level. They were really, really isolated.
But he was giving the nomads income by buying their yak milk and processing it into luxury cheese that he would export and use the money to invest in school and to have schools for nomads' kids. And nomads' kids could be closer to their parents, wouldn't have to go to the cities, could still learn their culture, their heritage, and also get a good education through online learning. This is the kind of innovation that was very inspiring to me.
It doesn't matter how much economic development you have if you know who you are and you have deep cultural roots. It's like a tree. The tree can grow very, very tall, because its roots are very, very deep regardless of the wind, regardless of the storm, that tree will not fall.
So it's very important to develop this concept of socially responsible investments. Business should be business, business should be profitable, but it has to be focused on caring for the environment, for culture, for heritage. Because ultimately it cares for people, because people are what's behind business and business should be for people.
Reporter: Liu Jianxi
Planning: Li Yunlong
Videographers: Wang Yucheng, Zheng Xiaotian
Video editors: Zhong Jianli, Ma Zhiyuan, Xu Qianyun
Producer: Wei Wei
Supervisor: Zhang Shilei
(If you want to contribute and have specific expertise, please contact us at