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Jump-starting rural development

By Li Hong (chinadaily.com.cn)
Updated: 2008-10-13 14:45

The key decision by China's Communist Party (CPC) on the 30^th anniversary of China's Reform and Opening-up, to allow the country's rural residents to transfer (lease and sell) their land-using rights to market-oriented farm corporations, is of historic importance. Economists anticipate that the new policy will unleash another colossal growth potential for the country.

Some are already predicting highly-efficient farm plantations of grain, wheat, corn, cotton, millet, beans, fruits and so on, dotted with big tractors and harvesters, to emerge on China's rural landscape.

Isn't this a long-cherished scenario of China's agriculture modernization?

For sure, the discussions on rural development are momentous at the Third Plenary Session of the 17th Communist Party of China's Central Committee, which concluded on October 12.

For the first time, farmer representatives from as far as the outlying borders and agricultural researchers were invited to attend and deliberate policies at the Party's plenum, a reflection of the democratic involvement of the CPC.

Domestic and foreign media have focused the spotlight on brand-new reform initiatives to transform the 30-year-old rural contract-based household responsibility system, and phase in market-oriented corporate plantations to solidify "quantity and quality" of China's agricultural produce.

Mechanized "big-farming", done by developed countries, is pointing the way for China's 21^st century agricultural sector. And, experts said, a package of government taxation and subsidy regimes, working in tandem with market demand and supply rule, will ensure China, a nation of 1.3 billion, to always have adequate production of grain to feed its people, although raising other cash crops are usually more lucrative.

The rural contract household responsibility system, initiated by Deng Xiaoping in 1978, was the first brave reform measure taken by the widely-revered and witty leader, after his re-emergence from political oblivion since 1975.

The reform abolished the rural commune farming system, a copy of the Soviet Union practice then, and distributed plots of land to rural households according to the number of people in each household. The policy led to a significant increase in China's grain output, and brought tens of millions of Chinese farmers out of poverty.

However, the land reform in 1978 has its limits, and can no longer keep pace with modern development. After China attained a peak of grain production in 1984, the yields have been stagnating. The reason is simple: Huge and miraculous growth of urban centers has created enormous job opportunities and many young farmers have been lured to the cities.

And, work in urban areas has proved to be more financially rewarding than toiling over a small piece of land at home. Many have chosen to lease their land to others, farm companies or collective cooperatives, while others just leave their land unattended and barren.

Beijing has resorted to various attempts to increase the income of rural dwellers, including the abolition of the agricultural tax in 2006, and subsidization of grain planting in 2007. Yet nothing has changed the reality of the vast countryside still playing second fiddle to the prosperous urbanities. And, when the countryside is left behind, it is harder to narrow the rural-urban gap.

Now, with proceeds from leasing or selling their plots of land, some farmers will be encouraged to move to towns and cities, and start their own businesses or get work, giving impetus to China's urbanization. Some experts say that up to one-third of the country's 700 million rural dwellers will migrate to urban districts by 2020.

Now, two critical problems face the government: to create jobs for the farmer-turned workers, and to set up a safety network for the new army of urbanities, namely, social security for unemployment, medical care and pensions, as well as schooling for their children.