10 Proposals for Further Deepening Reform: Agricultural Land Reform
Shenzhen Innovation and Development Institute (SZIDI) released the China Reform Report 2017 in May 2018. Entitled Reform on Route, this year’s report evaluates twelve major aspects of the reform process in 2017, concludes reform experiences from the past five years and makes predictions on the future trend of reform in 2018 with ten policy recommendations. The report identifies 2017 as a crucial year during which series of planning and design culminate into implementation, and historical breakthroughs and periodical progresses rise to the surface.
The report suggests that China should expand the scope of agricultural collective land beyond rural enterprises. With the boom in rural economy, agro-product processing, agricultural cold chain, logistics, warehouse, and local wholesale market facilities, as well as tourism and recreational agriculture also require more land. Lifting restrictions on the use of agricultural collective land can thus increase farmers’ income from property, and balance out the skyrocketing housing price in urban areas.
Besides agricultural land for commercial purpose, the report also examines the distribution and use of agricultural land for residential purpose. Chinese law restricts the agricultural land for residential purpose from free trading, for fear that free trading may expose farmers’ residential land to overwhelming inflows of capital. Nevertheless, the report finds that separating residential land from the functional market can harm farmers’ interests in the long term, in that it hinders the market distribution of land resources, and hurts farmers’ right to use their residential land. Therefore, the report suggests that local government should loosen the control on the free trading of agricultural land for residential purpose, and leave pricing to market.
Moreover, the report points out that the land use and planning mechanism should exhibit more flexibility and decentralization, leaving the distribution and operation role to the market. The report suggests that on one hand, central government may exert direct control over the national agricultural reserve regions, local government in charge of urban development regions, while provincial government responsible of environmental protection regions. On the other hand, the government should retreat from determining the distribution of agricultural land resources, only enacting relevant laws and regulations guiding and stipulating the behavior of land users, in order to maximize the social interests of agricultural land distribution and use.
