Crisis caution over urban push; The urbanization drive could fuel social unrest over land disputes and pose financial risks if money is thrown around recklessly
March 8, 2013 Leave a comment
Crisis caution over urban push
Friday, March 08, 2013
The urbanization drive could fuel social unrest over land disputes and pose financial risks if money is thrown around recklessly, a senior Communist Party official and a leading economist warned.
Shifting people from the countryside to cities is a policy priority for new leaders as they seek to sustain economic growth that last year slowed to a 13-year low of 7.8 percent.
Beijing hopes 60 percent of the nation’s almost 1.4 billion population will be urban residents by 2020.
The urban population jumped to above 700 million from less than 200 million in the previous 30 years but the explosion triggered sometimes violent clashes over seizures of farmland for development, as well as water shortages, pollution and other problems.
“These are severe challenges as we try to sustain the urbanization process,” said Chen Xiwen, head of the Office of Central Rural Work Leading Group, the top body guiding farm policy.
“Many people have worries and such worries are understandable,” he told a news conference on the sidelines of the annual parliament session.
Farmers must be protected from losing their land in the process, as local governments rely heavily on land sales to finance investment, Chen said.
“If the urbanization process becomes a process of depriving and harming farmers’ interests, it cannot be sustained and society cannot maintain stability.”
And influential Peking University economist Li Yining warned that banks could be dragged into another spending binge, sparking a financial crisis.
“When we talk about urbanization, it seems the whole country is going into mass action to spend heavily. This could trigger a financial crisis,” he said.
Urbanization guidelines are set to be issued within the first half of the year, National Development and Reform Commission head Zhang Ping said on Wednesday. National leaders have pledged to steadily reform the rigid household registration, or “hukou,” system that could help turn millions of rural workers from savers into consumers.
The hukou system has split the population along urban-rural lines, preventing millions registered as rural residents from settling in cities and enjoying basic urban welfare and services.
REUTERS
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