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Rural property rights reform the way forward

China Daily | Updated: 2020-04-29 07:20
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Herdsmen feed mares at a husbandry cooperative in Ulaanqab, the Inner Mongolia autonomous region. [Photo by Jiang Xueqing/China Daily]

Minister of Agriculture and Rural Affairs Han Changfu, entrusted by the State Council, China's Cabinet, recently submitted a report on reforming the rural collective property rights system to the country's top legislature.

That might signal the acceleration of China's rural collective property rights reform.

The reform of rural collective property rights system is rich in content and wide in scope. In late 2017, the 19th National Congress of the Communist Party of China called for deepening the reform of the rural collective property rights system to safeguard farmers' property rights.

It pointed out that "the reform of the economic system must focus on improving the property rights system and market-based allocation of factors, so as to realize effective incentives for property rights, free flow of factors, flexible price response, fair and orderly competition, and the survival of the fittest enterprises".

Land is the most important means of production, and collective land is the main property farmers have. Therefore, the reform of the rural land property rights system involves the marketization of the economic system and improving social distribution. It is also closely related to the fate of the Chinese economy.

The State Council recently issued a document on building a more perfect system and mechanism for market-based allocation of land elements, including the establishment and improvement of a unified urban and rural construction land market, the revision and improvement of regulations on land management, the formulation of guidelines on the marketization of rural collective commercial construction land, the reform of the rural land expropriation system and the expansion of the range of paid use of State-owned land.

The primary goal of rural land reform is to make farmers benefit and enjoy property earnings. That is also the key to improving the urbanization rate and promoting industrialization.

The development of some metropolitan clusters to attract more rural people also needs more land.

However, the existing land acquisition and auction policy increases land cost, while high housing prices and the resulting high economic cost potentially prevent farmers from moving to urban areas.

The current monopoly of land supply and bidding model is creating high asset price bubbles and financial risks.

Given that how to deal with the land issue is an important part of China's sustained economic development, the reform of the land use system is a key content of factor reform, which is not only an important reform to promote further economic development, but also an important measure to enhance China's economic security.

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