For Rural Communities, Brands Are 'Golden Key' to Escape Poverty
Updated: 12 23,2020 Source:China Daily

A worker packs white tea cakes in Hunan Xiangfeng Sangzhi White Tea Co Ltd on Dec 16, 2020. Photo by Zhao Shiyue

By integrating patent technology, trademark brands and geographic indications, to end poverty, China has constructed what are called "golden keys" to raise villagers' incomes and boost agriculture sector development in rural areas.

Geographic indication, or GI, is a sign displayed on products showing their geographic origin. This designation is a marker for product quality and reputation, determined by the location's specific environmental and cultural factors.

Geographic label assists poverty fight

Sangzhi, a remote county in Zhangjiajie, Hunan province, witnessed significant changes over the past 20 years under the support of National Intellectual Property Administration, the country's IPR authority. By taking advantage of local agricultural produce, Sangzhi nurtured four geographic trademarks, including its white tea and honey, while other two local specialties — reed leaves used as wrapping for zongzi, a Chinese rice snack, and oil tea —are in the application process for GI labeling.

As they must comply with several stringent requirements, goods with a GI label respect unified standards at every point of their workflow, said Zhang Fan, deputy county magistrate of Sangzhi. Enterprises from upstream to downstream are also required to fulfill certain production techniques based on strict quality control.

"There used to be small family workshops managing the tea business in the county, however, uneven production from one factory to another resulted in unstable quality output, and therefore poor sales," said Wang Xiao, deputy general manager of Hunan Xiangfeng Sangzhi White Tea Co Ltd.

With a GI label granted in 2019, Xiangfeng established an automatic production line in tea sorting and baking to meet unified production requirements. Different sectors along the industrial chain have become deeply integrated, which greatly boosted production capacity and further promoted the industrial upgrade of agriculture in Sangzhi county.

As of today, white tea plantations in the county have reached a cumulative area of 79,000 mu (5,266.67 hectares), with a total of 46 tea processing factories generating annual output of 228 million yuan in 2019.

Wang Xiao said the white tea industry has helped about 75,000 people get employment, with 35,000 of them from low-income families.

Before Peng Fengming, a villager, started working for the tea factory at the end of 2018, he did odd jobs in Shenzhen and Guangdong for over 10 years.

"I earn 4,000 to 5,000 yuan a month nowadays, which is higher than the salary in Shenzhen," Peng said. "Most importantly, I'm living with my wife and children and don't have to go outside to earn a living."

Local economic development creates opportunities for rural residents, attracting migrant workers to return to their hometowns, which eases shortages in youth labor and incidences of left-behind children, Wang Xiao said.

For 43-year-old Li Yanping, living standards have greatly improved after she joined the tea factory this March.

Even though she had to take care of her husband, who was paralyzed in a car accident 10 years ago, Li had no stable income and made little money by doing part-time jobs.

With a monthly salary of 3,000 to 4,000 yuan, Li can not only afford medical treatment for her husband, she can also support their son's studies in vocational school.

A woman processes reed leaves at Hunan Sangzhi Kanghua Reed Leaf Development Co Ltd on Dec 16, 2020. Photo by Zhao Shiyue

Another well-known trademark from Shangzhi county, Kanghua reed leaves, has grown from the grassroots to a big company with annual sales over 150 million yuan. This explosive growth owes a lot to the "branding effect".

Set up in 1997, Kanghua Corp has been collecting, processing and selling fresh and dry reed leaves for more than 20 years. The leaves, traditional wrappings for the Chinese rice snack zongzi, are now also used as decorations for dishes, especially for sushi and sashimi in Japan.

Backed by China's IPR authority, the company upgraded its branding three times to a national reputed trademark, successfully expanding Kanghua reed leaves to a wider audience.

"By taking advantage of the reed leaves industry, we aim to boost high-quality development of the regional economy in remote mountainous areas," said Peng Lihua, general manager of Kanghua Corp.

In 2019, about 1.3 billion reed leaves are sold annually at home and abroad, accounting for 70 percent of the domestic market share. The leaves are also exported to Japan, Singapore, the US and some European countries, where overseas Chinese communities are concentrated.

Stimulated by the power of branding, sales surge offered a path to prosperity for impoverished villagers in Sangzhi county.

According to official data, about 60,000 villagers are involved in the reed leaves industry with 3,769 low-income families have shrugged off poverty.

To shoulder the social responsibility to assist special groups, Kanghua Corp also hired 68 physically challenged workers on the same salary as other employees.

An example for the world

Sngzhi in Hunan province has set up a great example for rest of the world on how to use GIs to "nurture local brands, develop an industry and benefit people", said Liu Hua, director of the World Intellectual Property Organization Office in China.

"Policy support, education and investment are widely-known tools applied in the poverty alleviation fight, while 'the example of Sangzhi' demonstrates a new path to fortune by taking advantages of GIs, which have proved their long-term effectiveness and sustainability," Liu added.

Statistics from the China Intellectual Property Administration show among the 832 impoverished counties removed from poverty list, over 60 percent own GI labels. The output of GI products in China so far has reached a staggering 1 trillion yuan.