Limits set as China pushes urbanization

As China bets heavily on urbanization to bolster the economy, land officials have underscored the need to maintain a "red line" minimum for arable land and prohibit urbanites from buying rural land and building houses on it.

China will limit land use in cities with over 5 million residents to prevent city expansion from eroding farmland, Jiang Daming, minister of land and resources, said on Friday during a national land meeting.

According to Jiang, China will start demarcating permanent farmland around big cities and gradually introduce the policy nationally to draw a "red line" minimum for farmland in both urban and rural areas.

Jiang said the government won't allow counter-urbanization by urban residents seeking to buy rural land and build houses on it.

"NO ROOM FOR BARGAIN"

More large cities have emerged in China following more than thirty years of breakneck economic growth, eroding farmland on the fringes of cities -- an alarming side-effect for China with its population of 1.3 billion.

To ensure grain security, China has resolved to retain at least 1.8 billion mu (120 million hectares) of arable land. However, a lot of high-quality farmland has been nibbled away as cities grow, though the 1.8-billion-mu red line has not been crossed thanks to new land reclamation.

"There is no room for bargain," said Jiang.

The three megacity clusters of the Yangtze River Delta, Pearl River Delta and the Beijing-Tianjin-Hebei region shall focus on better use of land at their disposal as the central government tapers its land supply for construction purposes, Jiang said.

Generally, big cities with over 5 million people will not receive new land supplies, expect for the purpose of improving people's livelihood, such as for building new residential apartments.

Poor control over the pace of city development has resulted in disorderly expansion, Jiang said.

COUNTER-URBANIZATION NOT ALLOWED

Though urban land transactions have evolved into a vigorous property market that still acts as a major growth driver, land in the countryside remains largely static, as farmers generally have land use rights but cannot directly trade or mortgage the land. The government has sought to improve the efficiency of resource allocation.

In a landmark meeting on deepening reforms last November, China decided to allow farmers to transfer or mortgage their contracted land, or trade their rights for shares in large-scale farming entities.

While recent policy changes mean more farmers can settle in small cities and become official city residents, the government has called for discretion on the reverse -- city dwellers moving to the countryside.

"It should be noted that the purchase of rural land and building houses on it by city residents constitutes counter-urbanization, which is not allowed in any way," said Jiang.

Rural land reform is a complicated task that affects many interested parties and shall be carried out with discretion and prudence, Jiang said.

Experiments should be conducted in a few areas, and later the experience could be introduced elsewhere to protect the benefits of farmers, Jiang said.