PENSION REFORM IN CHINA: CHALLENGES AND OPPORTUNITIES

China's current segmented pension system features regional imbalance, fiscal inefficiency, social inequality and economic unsustainability. It is a result of three-decade evolution guided by vague long-term objectives, constrained by economic and political circumstances and swayed by interest-group infighting. Expecting rapid population ageing and economic transformation, China aims to establish a national pension system that provides ‘wide coverage, basic security, multi-level options and sustainability’ by 2020. The paper reviews the history of China's pension system, examines proposed reform options and discusses the challenges and opportunities faced by the reform.