Li Keqiang

Rich coastal townships hope to profit from urbanisation push

Amid urbanisation push prosperous coastal townships hope for an upgraded designation to boost their incomes and authority, reports say

PUBLISHED : Sunday, 06 January, 2013, 12:00am
UPDATED : Sunday, 06 January, 2013, 4:46am


Related topics

Affluent coastal townships are scrambling to get themselves classified as cities amid reports that the central government is thrashing out new policies to foster its urbanisation goals.

The Beijing-based Economic Observer reported yesterday that a new national plan to promote greater urbanisation this decade would be published around March, coinciding with the annual meetings of the national legislature and political advisory conference.

Li Keqiang, the No 2 official in the ruling Communist Party who will become premier in March, has been championing urbanisation as a potential driver of economic growth, seeing it as a way to boost incomes and domestic consumption.

As many as 300 million of a population of 1.4 billion is expected to move from the countryside by 2030 to join the 600 million already living in cities, according to the Organisation for Economic Co-operation and Development.

The Economic Observer report said, without citing its source, that the plan would affect more than 10,000 townships and some 180 cities at the prefecture level and above.

The plan was jointly drafted by the National Development and Reform Commission and ministries, including the finance, lands and housing ministries.

The 21 Century Business Herald reported on Thursday that economic planning officials in coastal Zhejiang province were considering trying to upgrade 27 townships into cities.

"Upgrading these townships to cities would mean raising the local administrations' authorities and resources," Zhejiang University professor Wu Jinqun said, according the report.

Since 2010 the province has had a pilot scheme giving 27 townships the same authority as county governments in regard to administrative, fiscal, personnel and land matters.

To continue to qualify, these "small cities" must have annual revenues in excess of one billion yuan (HK$1.2 billion) and an urban area of at least eight square kilometres by 2015.

The Economic Observer said the plan would also call for a national residential permit system to address the inequality faced by many migrant workers in cities.

Although the proportion of the population living in urban areas exceeded 50 per cent for the first time in 2011, only 35 per cent enjoyed urban-resident status under the household registration system, the report said.

Meanwhile, the State Council, the nation's cabinet, said the government would provide tax breaks to help ensure public transport accounts for 60 per cent of all urban travel.

"As China's urbanisation accelerates, the development of urban transport faces new challenges," the State Council said. "[The government] must prioritise the development of public transit systems to ease traffic congestion, transform urban transport, and improve people's quality of life."

The State Council said it aims to make public services the "dominant" form of transport in urban areas and boost the use of electrically powered vehicles, such as buses and trams, in addition to trains.

Additional reporting by Bloomberg