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Fiscal Fragmentation in Decentralized Countries

Subsidiarity, Solidarity and Asymmetry

Edited by Richard M. Bird and Robert D. Ebel

Most countries, developed and developing, are fiscally decentralized with regional and local governments of varying importance. In many of these countries, some of these sub-national governments differ substantially from others in terms of wealth, ethnic, religious, or linguistic composition. This book considers how fiscal arrangements may strengthen or weaken national solidarity and the effectiveness with which public services are provided. In particular, the nation’s ability to cope with changes created by decentralization is explored.
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Chapter 9: Ethnic Minority Regions and Fiscal Decentralization in China: The Promises and Reality of Asymmetric Treatment

Christine Wong


Christine Wong At first glance, China does not seem to fit into the group of countries in which decentralization affects, and is in turn affected by, national cohesion and ethnic relations. After all, China has a population that is highly homogeneous, with more than 90 per cent belonging to the Han racial and ethnic group, which has a strong, unified cultural and linguistic identity developed over 1000 years and dating back to the Han Dynasty. The reality is more complex. First, given China’s enormous size, while only 8.4 per cent of the population is non-Han, these minorities numbered nearly 107 million people by the end of 2000. Second, the non-Han so-called minority nationalities occupy a large and strategically important territory: some two-thirds of the minority population resides within 200 kilometres of China’s international borders, and more than 90 per cent of those borders lie along officially designated autonomous areas (see Figure 9.1; for a more detailed map of China see Figure 9.2). These areas contain more than 60 per cent of China’s total land area and many natural resources, for example, oil, gas and uranium in Xinjiang. Third, the interaction between the minority groups and the Han has been complicated historically, and to varying degrees the minority groups exhibit some ambivalence towards the Han-dominated Chinese state. Some of the groups are descendants from formerly independent states, notably Manchus, Mongols, Tibetans and Uighurs (a Turkic group located mostly in Xinjiang). Two of them, Mongols and Manchus, have ruled China itself at...

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