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The Biggest Losers In China's Massive Urbanization Plan

As the country plans to seize farmers' land and move them into more populous, resettled areas to drive the economy, it's clear who the losers will be.

A farmer working at a paddy field
A farmer working at a paddy field
Zhong Ang


BEIJING — Early this year China rolled out its blueprint for urbanization reform. The central government regards urbanization not only as a historic mission of modernization but also as the greatest potential for expanding domestic demand.

An investment feast is about to come. As forecast in the Plan For Promoting Healthy Urban Development (2011-2020) led by the National Development and Reform Commission, Chinese urbanization will activate 40 trillion RMB ($6 trillion) of investment over the next decade.

The essence of urbanization is to reform man-land relations. To begin with, the transferred and concentrated land will break with existing scattered farming operations. The use of machines and modern techniques will raise the scale of farming, enhance the product value and release a great amount of surplus labor. The surplus labor will in turn be resettled in concentrated and newly built towns. Meanwhile, the land resulting from the merging of villages will bring money rolling into the various levels of government.

This will result in a significant change in both traditional farming methods and in an agricultural lifestyle created thousands of years ago.

But as people enthusiastically talk about how domestic demand is to be stimulated, how macroeconomic development is to be maintained, how it is fortunate that land financing will continue and local government debt crises are to be solved, how there are business investment opportunities and the prosperous prospects for related industries, it becomes obvious that those who will be most affected by reform — the voices from farming, from rural places and from farmers themselves — are scarcely heard at all.

As some industry people put it, this is similar to the policy in which China gave subsidies to farmers who bought designated home appliances. Though the government put in billions to subsidize these rural dwellers of very modest income, they nonetheless still questioned whether it was really for them or simply a ploy to help the appliance businesses. One farmer complained that the solar water heater he bought did not function with the rural water and broke very quickly. And of course it was extremely troublesome to get it fixed in the countryside.

Likewise, it’s not hard to understand why the relocated farmers might find that apartments are not suited for them to dry their grains, rear their livestock and park their farming machinery after their houses have been forcibly demolished. Meanwhile, the authorities just reap the profits, from tens to hundreds of times the price difference, by swapping land with farmers and putting it to auction on the market.

Farmers get the short stick

One Zhejiang official responsible for land affairs worries that while various local authorities demolish villages and build apartments, they are not considering the farmers’ real needs. He says that without job placements farmers won’t stay in these new towns. They are bound to leave for bigger cities still and these new places will become ghost towns.

It is fair to say that urbanization will release a potential “land bonus” and provide a new impetus for China’s future development. And it’s also true that urbanization will free farmers from the land, pushing them to work in cities and boost China’s production. The problem is — and nobody can deny this — that farmers will not really reap the benefits of the land bonus.

Even though the farmers are relocated to apartments and are given some compensation, their new homes become nothing but “homesteads.” They are not permitted to sell them publicly because of what should be an obsolete regulation, a vestige of the Chinese Communist land policy of the 1950s. Meanwhile, the local authorities can change the nature of the land they had exchanged with the farmer and turn it into a moneymaker.

Any reform should take into account the interests of those directly affected. Alas, in China, the reality is that people who never take public transport are studying the public transport pricing policy. And people who eat specially supplied foods — a privilege of Beijing’s high flyers — are the ones formulating food safety policy.

When the people responsible for urbanization reform are viewing it from a macro-economic level and promoting it from the angle of solving urban and local government problems and related industrial development, it’s no wonder that farmers’ interests are neglected and sacrificed.

At this moment, when a new round of urbanization is in full swing, all levels of government ought to change their top-to-bottom way of thinking. They should consider and ensure farmers’ real needs and interests, improve their employment prospects, the household registration system, housing, education, and support systems such as social security and health care. After all, the main battlefield of urbanization reform is where the local farmers live, which they have relied on for their livings for generations.

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