China’s Developing Country Status: How Beijing Defends Its Global South Identity

Despite being the world’s second-largest economy and top manufacturing power, China continues to assert its developing country status through arguments about per capita income, rural-urban inequality, and historical responsibility.

This allows it to maintain beneficial treatment in international organizations while critics argue this stance is increasingly untenable.

China’s insistence on maintaining its “developing country” status has become one of the most contentious issues in international relations, sparking heated debates in forums from the World Trade Organization to climate summits.

While China has emerged as a global economic powerhouse as the world’s second-largest economy and dominant manufacturing force, Beijing continues to position itself alongside nations in the Global South, claiming the benefits and protections afforded to developing countries.

China’s primary justification centers on per capita income disparities. The per capita GDP in 2024 was 95,749 yuan, up by 5.1 percent over the previous year, which translates to approximately $13,500 when converted to US dollars. Chinese officials argue that while the country’s total GDP is massive, when divided among 1.4 billion people, individual incomes remain relatively modest compared to developed nations.

The World Bank and U.N. Development Program classify China as an “upper middle income” country, while the IMF calls the country an “emerging and developing economy.”

This classification places China in a middle tier, distinct from the high-income developed nations that typically bear greater international responsibilities.

China points to stark internal disparities as evidence of its developing status.

In 2023, the average annual per capita disposable income of rural households in China was approximately 21,691 yuan, roughly 40 percent of the income of urban households. This urban-rural divide, officials argue, demonstrates that hundreds of millions of Chinese citizens still live in conditions comparable to other developing nations.

Former Chinese Premier Li Keqiang stated, in 2020, that 600 million Chinese live on or under 1,000 yuan per month. At a conversion rate of 7 yuan to the dollar, this translates to $143 per month. Such statistics underscore China’s argument that significant portions of its population remain in poverty despite overall economic growth.

Beijing frames its current economic success as recent and potentially fragile.

Chinese officials emphasize that major economic reforms only began in the 1980s, making China’s development trajectory fundamentally different from traditional developed nations.

This historical framing extends to climate negotiations, where China’s 2022 submission to the ‘Work Programme to urgently scale up mitigation ambition and implementation in this critical decade’ starts by naming the principle of CBDR, then argues, ‘the lack of ambition of developed countries’ 2020 mitigation targets has not only led to a huge emission reductions gap but also resulted in a trust deficit’.

China’s developing country status in the WTO provides access to “special and differential treatment.”

There are for example provisions in some WTO Agreements which provide developing countries with longer transition periods before they are required to fully implement the agreement and developing countries can receive technical assistance.

However, the practical benefits may be limited. China received hardly any of the benefits that accrue to developing countries when it became a WTO member, besides the ability to use the title ‘developing country’. When China joined the WTO in 2001, it agreed to deeper commitments than typically required of developing nations, cutting tariffs more aggressively than would have been necessary under developing country provisions.

China’s classification as a “developing economy” provides several significant advantages in global negotiations and access to international finance. International organizations and treaties including various United Nations (UN) frameworks and climate accords. These agreements offer developing countries certain rights and preferential treatment. These special benefits are intended to reduce the financial burden for lower-income member states, often providing more lenient compliance timelines, greater financial aid eligibility, and reduced obligatory contributions

China’s developing country status became particularly contentious during climate negotiations. At the end of the two-week COP27 summt, negotiators from nearly 200 nations agreed to establish a fund to compensate vulnerable countries for the costs of addressing rising seas, stronger storms and other effects of a warming world.

Despite being “the largest emitter in the world now,” China resisted contributing to the loss and damage fund.

Chinese climate envoy Xie Zhenhua said: “China strongly supports the claims of developing and vulnerable countries for ‘loss and damage.’ China is also a developing country, and this year climate disasters have also brought huge losses to China”.

The tension stems from China’s emissions profile. China was responsible for more than a quarter of global greenhouse gas emissions in 2019. China’s per-capita emissions of 9 tonnes CO2 equivalent in 2019 were well above EU levels and far above the global average.

Yet China’s cumulative and per capita annual emissions still reached only about half of the US’s as of 2023.

The U.S. has led efforts to challenge China’s status. The U.S. Senate Committee on Foreign Relations approved the Ending China’s Developing Nation Status Act on June 8, 2023. The bill requires the State Department to attempt to “stop China from being classified as a developing nation by international organizations”.

The core issue lies in how developing status is determined. In legal terms, WTO members hold the right to self-declare the status they hold. Developing countries have thus been quick to point out that access to SDT is “a fundamental treaty-based right”.

The head of the Chinese delegation stated along these lines at a WTO working group meeting in 2001: “we … firmly believe that China is a developing country. The position we have taken to accede to the WTO as a developing country is not only a reflection of the actual economic level of China at the present stage, but also our political choice”.

China’s status creates divisions within the Global South itself. Larger developing countries that are also considered to be emerging are thus more likely to side with China, as they fear that greater differentiation would also reduce their own access to S&D. Countries like India, Brazil, and South Africa have supported China’s position.

However, developing country members that are not commonly considered to be emerging economically are more likely to see China (and other emerging economies) as unfair competitors for these special rights. Smaller developing nations worry that China’s access to developing country benefits reduces the resources available to them.

China’s insistence on maintaining developing country status reflects a complex interplay of economic realities, political strategy, and historical grievances.