China: World Bank to Help Develop Portable Social Security and Rural Worker Training in Guangdong

June 20, 2013

WASHINGTON, June 20, 2013 –Today the World Bank’s Board of Executive Directors approved a loan of US$80 million to the People’s Republic of China to help enhance portability of social security entitlements and strengthen the skills base and employment prospects of rural workers in Guangdong Province.

Guangdong is China's largest province in terms of the size of its economy with a GDP at 5.7 trillion yuan (US$915 billion) and a growth rate of over 10 percent in 2012. It also has the largest migrant population of any province in China, including 18.7 million inter-provincial migrants and more than 31 million migrants in total. With its move from the traditional low-cost manufacturing model to production of more knowledge-intensive goods and services, Guangdong is confronted with growing demand for skills in the workforce and a dynamic adjustment in the labor market. The Guangdong Social Security Integration and Rural Workers Training Project is designed to assist in the government’s efforts to address this challenge.

“We will work with Guangdong to facilitate labor mobility for workers through greater integration of social insurance and employment information systems, and through investments in the skills of rural workers to facilitate their geographic and occupational mobility. By promoting greater access to training opportunities and to portable social insurance and employment services for rural migrant workers, it will also enhance social equity,” said Wang Dewen, World Bank Social Protection Economist in China.

“We hope that the innovations and pilots in Guangdong will provide an important demonstration for other Chinese provinces facing similar challenges, and thus contribute to development of the national social security system,” added Philip O’Keefe, Task Team Leader for the project.

The new project will support development of a provincial social security management information system which will serve to integrate data management of social insurance, employment services and human resources across the 21 prefectures in Guangdong. It will make it possible for social security and employment services to be accessed anywhere in the province and independent of the worker’s hukou registration. Money and entitlements would “follow the worker”.

The project will also invest in technical training institutions with a focus on short-term training needs of current and potential migrants for both entry-level and upgrading of skills, supported by a strengthened set of services to support post-training placement. In addition, there will be a strong emphasis on deepening school-industry partnerships to enhance the labor market relevance of training. Support will be provided to help selected schools strengthen the capacities of administrators and teachers and to develop modular, competency-based training programs.

The total cost of the project is more than US$149.7 million, with the IBRD loan accounting for about 53 percent.

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