SHOUYING LIUSENIOR RESEARCH FELLOW AT DEVELOPMENT RESEARCH CENTER OF THE STATE COUNCIL, CHINA

THE 16TH ANNUAL WORLD BANK CONFERENCE ON LAND AND POVERTY

New Economic Normal and Land Reform in China

Contents

Traditional Growth Model and Land Tenure System in China

China Has Entered An New Economic Normal

Land Reform In The New Stage

I. Traditional Growth Model and Land Tenure System in China

China’s Economic MiracleHigh growth rate averaging 10%

China’s 31 provinces

140 other economies in the world

Increasing speed of GDP Growth rate from 1978 to 2013

Thanks to Strategy of export oriented industribution. China became the world’s largest manufacturer in 2010

China’s rapid urbanization : annual 1.5% urbanization rate

Land is the Core Contributing Factor

Land rights structure:Rural collective ownershipUrban state ownershipLand conversion arrangements:

Rural land is converted to urban land through government-led requisition.

Central government utilizes land use plan and land quota to control the scale of land conversion.

Land market structure: Local governments monopolize urban land primary market. Rural construction land cannot enter into market. Land transfer income belongs to local governments.

2. Requisition of Rural Land and social unrest

From 2005 to 2011, 10,200 km2 of rural land were requisitioned and converted to state land for urban construction use. Annual requisition of rural land averaged 1,460 km2.

Low Industrial land price have been sustained under the regulated land management system

Urban Land Prices: National Average 2008-2013 (CNY/ square meter)

Governments’ land sales revenue grew rapidly from 129.6 billion yuan in 2001 to 4.2 trillion yuan in 2013.

Collateralized land area and collateral loan amount have both jumped

II.China Has Entered A New Economic Normal

China’s potential growth rate is projected to slow down in about 2015.

附图7 中国的GDP增长率

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历史数据基于全国数据分省预测再加总基于用电量基于汽车保有量基于汽车产量基于钢铁累计产量基于钢铁产量五年平均均值

(%)

数据来源：国家统计局；国务院发展研究中心经济增长课题组测算

预测值历史值

China can no longer sustain double-digit growth. Growth rate will first stabilize at 7-8 percent for some years,

before dropping to a moderate speed of 6-7 percent. 6-7 percent will be China’s new norm in the future.Source of growth will mainly depend on improving productivity.

The peak of China’s annual housing demand is estimated to be between 12 to 13 million units, and is expected to come in 2015.

High housing prices can no longer maintain high government land revenue

Revenue from land sales as share of total local government revenue(1999-2013)

III. Land Reform In The New Stage

Land Reform is the core factor supporting the new norm

The slowdown in economic growth means China can no longer rely on land as a growth engine.

The new growth model focuses on quality not speed. Thus, land supply will shift from quantity increase to improving land use efficiency.

The main Contents of land reform in the 3rd Plenary Session of 18th CPC Central Committee

Building a united land market Integrating rural and urban areas Reforming agricultural management system separating

management right from ownership right and contracting right.Building rural collective construction land market.Reforming land requisition system.Reforming rural homestead system.

The Contents of Land Reform Experiments

Land reform experiments in 33 counties Core reform of new type of urbanization and

rural comprehensive reform.Main contents:

rural commercial collective construction land entering into market;

rural land taking system reform; rural homestead land system reform.

Land reform experiments are permitted by CCCPC.

The Possible Effects of Land Reform

1.collective construction land entering into market:Larger development space at developed regions and pre-urban areas;Collective commercial construction land can rent, transfer and mortgage.

2. land taking system reform:Land cost will rise;More farmers’ existing construction land will entering into market directly;More equal allocation of land incremental income.

3.Rural homestead land system reform The assets value of rural residents in pre-urban areas will risen.The development space of pre-urban areas will expand.Restructuring village communities.

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