Inside China’s New National Urbanization Plan for 2014-2020

On March 16th 2014, the Central Committee of the Chinese Communist Party and the State Council published the National Urbanization Plan for 2014-2020 . Based on the Congress’ Opening speech by Li Keqiang, the document is organized into eight main parts and 31 chapters that present a vision of urbanization as the primary motor of China’s economic growth, while also “focusing on the human” elements of this process.

The document is divided into three main sections. The third part (strategically positioned within the text, right after the introduction and the ideological considerations) focuses on the issue of transferring and integrating rural populations to the city center by adopting new social measures, including the extension of social security coverage and the right of access to pensions and child education. The fourth part focuses on the objectives of optimizing urbanization, its physical shape, as well as its development trends. This includes for example, shifting the primary focus of China’s urbanization from large cities towards smaller scale cities in central Chinese provinces. The fifth part, entitled “Strengthening Capabilities to Implement Sustainable Urban Development”, is the document’s longest section. The following sections then address the role of creativity and innovation in urbanism (new terms in the conventional lexicon of these documents), the place of quality control in construction, and the challenges of urban governance and environment (for example, the improvement of air and water quality, a focus on “green” construction and recycled and energy-saving products, etc.).

Focusing on the main announcements, the following are analyses issued by international and Chinese media:

According to the official objective, 60% of the Chinese population will be urban in 2020. Currently 53.7% of China is urban, which will mean the integration of approximately 100 million additional migrants, as well as a massive investment in public services and transport infrastructure. As such, the government plans to develop regular train connections between cities of more than 200 000 inhabitants and high-speed railway networks between cities of more than 500 000, in addition to the extension of air transport.

Urban hukou requirements will also be relaxed, as the government plans to have 45% of the overall population officially registered as city residents by 2020 (compared to the 36% registered today). Beijing thus hopes to support economic growth by increasing the demand in infrastructure and strengthening national consumption. Liberalization of the hukou, which will be extremely costly, will first be implemented in cities of less than 5 million inhabitants as, in accordance with recent policies, the new plan prioritizes the urbanization of smaller cities.

This objective, however, ignores two important realities: First, a lack of resources to improve the fragile financial situation and typically high debt rates in small and medium-sized cities could threaten this strategy. Experts point out the lack of fiscal reform, which might enable local governments to finance the urbanization of newly arrived migrants. The central government could, for example, allow local administrations more freedom in their right to collect taxes, which at presently is very limited. Second, small and medium-sized cities are usually less attractive for migrants, who favor large cities where employment opportunities may be better or more plentiful.

In large cities, hukou attribution is based on a score system, discriminating between poor workers and favoring elites (“qualified” diploma holders). Some analysts regret that the new plan does not question this controversial system.

Beijing has also announced the creation of a national registry for property titles before 2020. Local media adds that the cities of Zhengzhou, Ningbo and Nanjing have been designated as pilot cities. In order to stabilize the real-estate market, development of a national network of information on housing was also announced. But according to the South China Morning Post, this national network project, started in 2011, is already late in delivering on its initial promises and objectives.