People-oriented Urbanization? Three events in May

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 In March of this year the Central Committee of the Communist Party of China (CPC) and the State Council released the National New-type Urbanization Plan” for the 2014-2020 period ((Xinhua, “China’s new plan targets quality urbanization”, March 17, 2014. Available at Today, Chinese urban residents make up 53.7% of the entire population; a huge increase on the less than 20% who lived in cities in 1978, at the beginning of the reform-era.

However, this figure is still less than the 80% urbanization figure for developed countries’ and the 60% that is common to countries with similar per capita income levels as China.In addition, according to data of the National Bureau Statistics, while 53.7% of the population lives in cities, only 35.7% holds the urban hukou that gives them full access to local services ((The Hukou (户口) is a record in the Household Registration System required by law in the PRC. It identifies a person as a resident of a particular area of the country and includes basic information such as name, parents, date of birth and marital status. There are two types of hukou, the urban hukou and the rural hukou, holders of the latter not being allowed to enjoy the same public services as holders of the former in Chinese cities. Although still facing severe challenges and moving slowly, the Chinese government is trying to bridge the gap with its urban-rural integration initiative.)) . Following the implementation of the new 2014 Urbanization Plan, by 2020 China’s ratio of urban residents to total population should reach the 60% mark, while urban hukou holders should account for about 45% of total population. As highlighted in the plan, further increasing urbanization will raise the income of rural resident through urban employment; unleash the consumption potential; and attract investments in urban infrastructure, public service facilities and housing construction.Urbanization is nothing new, but in the specific case of China both the speed of the change, and the number of people involved, is unprecedented. How is China facing this process? What challenges does it have to overcome? What are the reforms that need to be implemented? These are a few of the questions that experts are trying to answer and their responses will significantly impact the living conditions of a billion people. Who responds – whether it is down to the state, or whether there is a role for the non-state – is another question that is yet to be fully answered.

During the month of May, CDB participated in three important events concerning urbanization and its sustainable development. On May 16th the Embassy of Sweden welcomed the Foreign Correspondents’ Club of China (FCCC) event “100 Million Questions: how will China accommodate its new Urban Residents?”, with Klaus Rohland, the World Bank (WB) Country Director for China, Mongolia and South Korea, explaining the core features of the WB report “Urban China” (also released in March 2014 ((The World Bank report, “Urban China: toward efficient, inclusive and sustainable urbanization”, 2014.)). According to the report, reform-era China is currently facing what is probably its hardest challenge: maintaining GDP growth while changing its development model. It is moving from an investment-led economy to a consumption-led one, while also dealing with numerous associated issues such as migration, erosion of services for urban citizens, growing inequalities, and rising environmental degradation.

Urbanization plays a key role in the new reform agenda of the Chinese government and, as highlighted in the WB report, it has to become more efficient, inclusive, and sustainable. As Rohland showed during his presentation, the majority of Chinese cities are too large, with a huge environmental footprint but not enough density. This causes urban sprawl, wasting both space and resources. According to the WB analysis, for example, Guangzhou could accommodate 4.5 million more people with Seoul’s density profile. Urbanization also hasn’t been inclusive so far, with the hukou system in particular creating deep inequalities between city dwellers and rural migrants. The fiscal system also needs to be improved. There is a huge discrepancy between local government income and what they spend on urbanizing. In the last few years, and while many migrant workers are unable to find affordable housing, too many resources have been wasted in the creation of ghost towns and pharaonic projects with high impact on the environment. Another message that was repeated at the talk was that China should stop thinking about growth and start focusing on the quality of life of its population. For doing so, the World Bank has suggested a comprehensive reform package centered around four priority areas: land, hukou, the fiscal system, and the incentive system of local governments. These four reforms would be followed by reform of social policies and service delivery, urban planning, and environmental management. While a few pilot projects have been implemented in some provinces, nation-wide reforms will not be implemented for a number of years.The second May event that discussed urbanization was the “Sino-European Workshop on Sustainable Development in the Context of Rural-Urban Population Transit”. It was organized by PlaNet Finance ((Founded in 1998, PlaNet Finance is a leading player in the promotion and development of micro-finance worldwide. Through a range of advisory services and development programs, PlaNet Finance helps local financial institutions to adopt international best practices and contribute to the development of inclusive financial sectors.)) and held in Beijing on May 5th, 2014. Among the panelists and the audience, were senior experts from the National Development and Reform Commission (NDRC) ((The National Development and Reform Commission of the Government of the PRC is a macroeconomic management agency under the Chinese State Council with the administrative and planning control over the Chinese economy.)) and the Chinese Academy of Social Sciences; Chinese officials; academics from Peking University, Ningxia University and Nottingham University; and representatives from Chinese and international foundations, NGOs, and media organizations.

The PlaNet Finance conference started with an outline of the state perspective on urbanization. Xiao Jincheng, head of the Institute of Spatial Planning and Regional Economy of the NDRC, illustrated the current situation of the phenomenon. Xiao explained that alongside the 260 million migrant workers that are now living in cities without being entitled to any social services, there are also more than 50 million children and 50 million women left-behind in the rural ‘sender’ areas. Xiao argued that it was time to approach this issue in a more ‘people-oriented’ way, planning for a more gradual absorption of migrants into cities, especially in second and third tier cities ((According to the World Bank, projections for the year 2030 say that some other 300 million people will leave the countryside heading towards to eastern regions of China.)). Qiu Aijun, Vice-Director of the NDRC’s China Centre for Urban Development, spoke after Zhang and highlighted the need to move from ‘quantity’ to ‘quality’. She argued that instead of just counting how many migrants are moving around China, greater attention should be focused on their life and needs.

After the NDRC speakers, Nini Khor, economist for the Asian Development Bank (ADB), gave one of the most interesting speeches of the day, pointing out that local governments have been paying heavily for China’s urbanization, and are now highly indebted due to excesses in urban construction and infrastructure development. While expenditures in this sector were sky-rocketing, the percentage of GDP invested in health and education has stagnated, notwithstanding the fact that in the last decade China has seen an increase of fiscal revenues, from 11% of GDP in 2000 to 22,6% last year. Khor’s ADB data highlighted the worrying gaps in education between urban and rural areas that have developed over the last few years: almost 70% of urban teenagers attend high schools, whilst this figure plummets to just 30% in rural areas. Khor made clear that to start addressing today’s social inequalities, and because China is becoming a higher-middle-income country that in the next two decades will need less and less unskilled labor, the time has come for China to invest more in human capital.

In the remaining part of the conference professor Richard Hardiman, Environmental Governance Specialist in the EU-China Environmental Governance Program, and professor Heinz-Peter Mang, German Biogas Association, presented models and projects implemented in Europe for rural transformation and renewable energy development that might be applied to the Chinese case. In the afternoon Zhang Shuanbao, Deputy Mayor from Tongwei county in Gansu province, illustrated the urbanization path of Tongwei through agriculture industrialization, tourism and investments in infrastructures. Zhang pointed out the importance of the vocational training program implemented for raising the employability of migrant workers, with a plan to annually train fifteen thousand new employees every year in the future. Unfortunately, and as with most of the other presentations, the discussion didn’t go further than the official level. After showing some data about GDP growth and investment rates, no time was given to explain how the local government has been addressing social problems, or about whether any role has been given to social organizations. Nor was there any mention of the environmental impact of the process, or whether any consultation at the grassroots level had been planned.On the whole, the solutions suggested during the two events described above focused on economics and state planning, ignoring the possibility of alternative, more holistic and multilateral methods, involving civil society. As the founder and editor of China Dialogue, Isabel Hilton, said at the end of the PlaNet conference, it seems that the ‘base of the pyramid’ had been completely neglected. Fortunately, China’s non-profit sector has been developing quickly in the last decades: several Chinese NGOs are now playing a valuable role in ameliorating the wide-ranging impacts of mass-urbanization.

For example, the Beijing-based NGO Included works for opening access to the city for migrants living in poor areas. In May, Included organized an exhibition in the centre of a Sanlitun shopping district that aimed to raise awareness of the issues surrounding migrant workers. The exhibition — displayed within shipping containers and surrounded by the neon lights of high-commercialism — told stories of migrants lives: looking at where they came from, how they live, what sacrifices they have to make and what can be done to help them to achieve higher standards of living. Over the ten days the exhibition was visited by 25.000 people, a huge success for Included. (Watch an interview with Included founder and executive director Jonathan Hursh here).

Other examples of Beijing-based NGOs that focus on mitigating the negative effects of migration and urbanization include the Migrant Workers Home (北京工友之家文化发展中心), United Heart Home of Hope (同心希望家园), the Beijing Rural Children’s Cultural Development Center (北京农民之子文化发展中心) and the New Citizen Programme (新公民计划), all specializing in providing education programs for children of migrant workers, psychological care volunteer services, and public welfare innovation. The organization China Rural Library (立人乡村图书馆) helps young people in rural areas to become responsible and active citizens, joining the volunteering project of “build a library in your hometown” for promoting literacy and strengthening rural education efforts. Centered on rural development is also the activity of the Beijing Green Cross (北京绿十字), an environmental protection NGO that aims at improving rural self-governance and community cohesion, through projects like rural cultural revitalization and training, soil improvement and organic agriculture, financing, tourism planning, ecological planning and design. Since thousands of rural Chinese every year relocate to cities, creating “empty villages” in the countryside, Beijing Green Cross fights for reemphasize the importance of rural areas, helping in the creation of wealth and self-awareness, while protecting the environment.

Organizations such as these fill the gaps, anticipating the suggestions of international organizations and the moves of officials. For the future we hope to see better cooperation among these actors, so that the next time that CDB participates in a conference about urbanization the speakers will talk more about how to provide social services to disadvantaged people and less about how to obtain more GDP growth through urbanization.

In Brief

CDB intern Martina Poletti reports on three events in May that discussed making China’s urbanization more sustainable.
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