New land reform to give farmers more property rights

Even without his son and daughter by his side, Shen Jialiang, 50, will no longer worry about harvesting his 15 mu (1 hectare) of land in east China's Anhui province.

Thanks to a land transfer trust promoted in the Yongqiao District of Suzhou city this October, Shen can now receive 500 kg of wheat per mu of land as a contract fee, worth more than 1,000 yuan (163 US dollars), which is almost as much as his typical earnings from harvests in previous years.

CITIC Trust, a major Chinese trust company, introduced the country's first land transfer trust program in mid-October. The program manages 5,400 mu of rural land in Yongqiao District and pays contract fees to the farmers. A local company is building an agricultural park on the land.

With the income from contract fees as well as the expected value-added profits of his land, Shen can spend more time working in cities to earn more to support his family.

China's leaders put forward a multitude of reforms two weeks ago at the third plenary session of the 18th Communist Party of China (CPC) Central Committee. A reform masterplan approved at the session promises to give the country's 650 million rural residents more property rights.

A rural property market will be established, and people will be encouraged to transform their collective rights into a shareholding system. A pilot program will enable the mortgaging and transfer of homesteads.

The government will also allow the sale, lease and demutualization of rural construction land with a number of restrictions. These specific measures for land under construction will further protect rural land rights.

"A new round of 'land reform' will allow farmers to enjoy more revenues from their land and will prompt the integration of urban and rural areas," said Zhang Deyuan, director of the rural reform and economic and social development research institute with Anhui University.

According to Chinese law, urban land is owned by the state, and rural land is under collective ownership. Farmers may use the land, but have no rights to sell or develop it.

Since the 1990s, the property market has flourished in cities and has been a major engine of growth, while ownership rules for rural land have not changed in decades, constricting rural development.

While farmers cannot trade their land, the law allows the government to acquire land for public use after compensating occupants, and then legally change the land use, transferring the title to real estate developers at a substantial profit. This practice is currently a major source of revenues for some local governments.

At the Yuji Village in neighboring Lingbi County, a cultural project covering an area of 300 mu of land is under construction. The land has been requisitioned at the price of 20,000 yuan per mu from villagers.

The project is expected to bring more than 5 million yuan in tourism revenue each year after completion, according to official data. However, the villagers who have transferred their land will not share those revenues.

The transfer of land for little compensation is not rare in China. Clashes over land requisitions have frequently been reported across China in recent years.

"The new round of land reform emphasizes the establishment of a unified construction land market in urban and rural areas, which implies local government should shift its role from direct player in land transactions to a public service provider," said Zhang.

Anhui Province spearheaded land reform in 1978 in a bold move that broke up the previous commune-style collective farming, resulting in a nationwide policy change in which collective-owned land is leased to individual rural families for private farming.

Thirty-five years later, another reform is looming in the province to give rural families more opportunities to profit from land. The provincial government issued a document on Nov. 12 saying it would experiment with the trade and compensation of farmers' residential land.

Shen Jialiang, however, is hesitant to follow suit and give up his land.

"I cannot afford to buy a house in the city and for now it's hard for me to be registered as an urban resident," he said. "Without my countryside house, I would be homeless."

Equal status between urban and rural residents is a prerequisite for rural land to be traded in the market, said Chi Fulin, head of the China Institute for Reform and Development, a think tank based in southern China's Hainan Province.

"Rural residents should enjoy the same welfare, educational and medical resources as their urban peers so they can settle in the cities," said Chi.

The priority at present is to unify the social policies in urban and rural areas, Chi said.