Charity donations in China are urgent needed by 30 million rural residents still living in absolute poverty, and another 30 million urban residents living in poor conditions, which in total account for more than 10 percent of the whole 1.3 billion population.

A report by China News Service said Tuesday that in 2004 the charity donations by China's top 135 philanthropists was 985 million yuan (about US$119 million), while from 2000 to 2004, charity donations by the top 50 philanthropists totaled US$65 billion, 600 times of that in China. Microsoft's Bill Gates alone donated US$23 billion over the past four years, 54 percent of his net asset.

An official with the central committee of the China Democratic League was quoted as saying that the underdeveloped charity cause was mainly due to a shortage of effective charity mechanisms.

In the past, the charity cause was wholly run by the government under a planned economy, as a result of which the number of charity organizations is now only 100 or so with charity funds taking up less than 0.1 percent of the gross domestic product (GDP).

Charity organizations used to depend on governmental funds, thus lacking the capability to collect funds from the public, the official explained, adding the lack of special laws and regulations on the establishment, evaluation and supervision of the charity organizations also led to the problem.

China is in urgent need to renovate the mechanism of the charity cause and enhance the current law system, the official said, calling on China's legislature to draft a set of regulations on charity.

Favorable and supportive policies and credit approval should be given to well-run charities. An inheritance tax and a tax on special consumption should be set up to encourage the rich to more actively participate in charity, he added.

A World Bank report said that the disparity between the rich and poor in China grew at the fastest growth speed over the past 20 years. And the China Charity Federation, the largest charity organization in the Chinese mainland, said the Chinese mainland has seen a year-on-year rise in donations by the rich, although their donations only accounted for 15 percent of the 1.5 billion yuan (about US$181 million) total over the past 10 years.

Last year, a regulation on foundation management was issued to encourage private sectors and non-governmental organizations to join in charity. This move, as Zhu Li, a sociology professor with Nanjing University observed, will directly lead to a surge of donations by private business.

(Xinhua News Agency July 13, 2005)