Land issue stumbling block to development

PUBLISHED : Monday, 21 January, 2008, 12:00am
UPDATED : Monday, 21 January, 2008, 12:00am

Exactly 30 years ago, several dozen famished farmers in Xiaogang village in Anhui province rose against the commune and took over farmland and divided it among themselves to boost production.

The controversial move, which was first attacked as a return to capitalism, was quickly endorsed by Deng Xiaoping . It not only triggered a wave of revolutionary changes which led to the current system of 30-year leases on land plots by farmers but also marked the beginning of mainland's historic process of opening up and reforms.

As the central government makes elaborate celebrations to mark the 30th anniversary of its reform and open-door policies later this year, the farmers have stood up again. This time they are demanding full privatisation of land.

Late last year, a small group of farmers in Fujin , Heilongjiang province , made a bold declaration, voting and dividing farmland among themselves. Thanks to the internet, their action was supported by farmers in Shaanxi , Jiangsu , and Tianjin .

Reminiscent of the controversy 30 years ago, the officials' initial reactions were negative. They responded by cracking down and last week sentencing farm leader Yu Changwu in Fujin to two years in a labour camp without a trial.

And like the initial stage of the Xiaogang revolution, the majority opinion on the mainland has been that the Heilongjiang farmers' bold attempt was doomed to fail.

At first glance, that may be the case. However, the action by Mr Yu and his fellow farmers may well be the harbinger of another revolutionary land reform.

It is about time that the mainland leadership mustered the political wisdom and courage to tackle the land issue. Without further land reforms, agriculture will forever remain weak, the urban-rural income gap will only get wider, and the government's ambition of bringing the population of 1.3 billion, of whom more than 700 million are farmers, comfortable living standards by 2020 would just be an empty slogan.

In fact, there have been calls for privatisation of land on and off in the past decade, although the debates were usually conducted within the Communist Party and behind closed doors.

The discussions have remained largely academic because the system of collective land ownership is seen as one of the pillars of socialism and enshrined in the constitution. But rapid urbanisation and economic growth have prompted more and more mainland officials and economists to realise that the land ownership issue has become the biggest stumbling block to improving agricultural development, the weakest link in the mainland economy.

Over the years, the mainland has reclaimed an annual average of 5million mu (333,500 hectares) of land, including more than 2 million mu of farmland, for urban development.

But several more million mu of farmland is illegally taken for development every year due to collusion between rural officials and greedy developers.

This is because the vague definition of collective ownership of land means that the power to sell the land usually rests in the hands of village and township party secretaries.

Mainland officials have openly admitted that a majority of the riots in the rural areas are due to disputes over land, with farmers accusing village or township officials of selling the land cheaply to developers.

The legal and illegal seizure of land has left tens of millions of farmers landless, to wander around the country looking for jobs - a potentially explosive source of social instability.

Moreover, the current system of land lease, sparked by the Xiaogang reform 30 years ago, has outlived its usefulness.

The system, which entitles every farming household to lease plots of land for 30 years, after which they can renew the lease, has deterred the formation of bigger farms and made it difficult to improve productivity.

As the mainland marks the 30th anniversary of the reforms sparked by the Xiaogang land reform, it is an appropriate time for the leadership to take another historic step forward.

While it may be difficult to overcome the ideological barriers and undertake full privatisation of land in the short-term, there are things the mainland leadership can do immediately.

For one, the leadership can grant longer or even permanent land-use rights to farmers.

Secondly, it should allow farmers to trade their land-use rights freely and according to the market prices after an adequate amount of land is set aside for farming.

At present, the mainland leadership reclaims land at a fraction of the market price for the purpose of urbanisation but this has created a big loophole for village officials and developers.

Only by taking the reforms can farmers truly be compensated for the loss of land and see their living standards improve greatly.

It will also encourage the corporatisation of land to boost agricultural productivity and production.