Rural Reform in China: Walking on Eggshells

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The Communist Party’s big meeting (Third Plenum) for the year takes place in Beijing over the coming weekend. There have been strong hints that something will be done about land reform, a very hot issue for China’s 700 million peasants who have no right to sell their land and must depend on 30 year leases issued by the state. As we have written before, this is a potentially explosive issue for the party, which fears that granting sale and purchase rights could lead to a mass exodus from the countryside or result in peasants selling their land for a song to big agricultural companies, blowing the money and then ending up as landless sharecroppers to giant corporations, aka “landlords,” a very sensitive word in China . On the other hand, cadres are well aware that the three or four to one gap (depending on who’s counting) between urban and rural incomes is not sustainable so something must be done to allow peasants to utilize their land more fully. It appears from the somewhat (!) opaque official media reports that some sort of compromise solution short of actually allowing full rights to peasants will be enshrined at the meeting. This would involve allowing peasants to lease their land to commercial enterprises and the like, rather than be forced to depend exclusively on farming. Here’s how the official news agency Xinhua framed it, describing a visit by President Hu Jintao to the village of Xiaogang in Anhui province (the village is famous as it was there that villagers first clubbed together thirty years ago and began the movement that would result in the end of the system of collectivized farming so beloved of Mao Zedong, ushering in private cultivation, a move that sent rural incomes soaring, for a while at least):

Hu Jintao said: I would like to clearly tell you villagers that the two-tier management system that integrates unified with separate management on the basis of household contract management is the cornerstone for the party’s rural policies. Not only the current land contract relationship will remain stable and unchanged over a long time, greater and protected land contract and management right will be given to the peasants. Besides, on the basis of their wishes, the peasants will be allowed to transfer in various ways the land contract and management right and to develop management on an appropriate scale.

The ast sentence is key, obviously. We’ll have to wait for the details, where, as they say, the devil resides.