If nations could replay history, would they opt again for the city slums, migrant ghettos, shanty towns, pollution, congestion and crime - the epitome of urbanisation at varying times - in virtually every country? Would they repeat the demise of rural communities and their cultural heritage, and the loss of economic viability of small towns and villages? Surely not. For much of the world that story lies well in the past. For China, however, it is unfolding now, with the massive shift of population to cities, mostly along the broad coastal belt, many of which are already bursting at the seams. Historically, successive Chinese governments facilitated development of areas having sea or river access, while guarding the rest of the country from foreign exposure - witness the establishment of the treaty ports back in the mid-19th century, the launch of special economic zones in 1980, and the further opening of coastal regions and nearby hinterlands over the following decade. At times, rural areas have been additionally hit by expropriation of food production or other unfair fiscal transfers to the more affluent cities. Only in the past decade or so have the authorities fully awakened to the economic folly of showering favours on already relatively prosperous areas, and thus have begun to help remoter provinces catch up, or at least survive. There are political motives too. Despite that, the prospect of underemployed peasants continuing to move to the cities - and more than 100 million may already have done so - presents beguiling advantages on all sides. Factories and construction get cheap labour, though employers are now beginning to have to pay more towards social welfare; the migrants get paid beyond their wildest dreams (officially, the disposable income gap between urban and rural workers was a factor of more than three last year) and remit a lot to their families; and the government basks in the glow of statistics showing meteoric economic performance. The downside - gigantic urban sprawls and a potential migrant underclass - tends to be underplayed. One might wish that soaring costs in the cities would eventually drive businesses to the cheaper regions. But, as other countries have found, market forces seldom deliver that result, at least not on the desired scale. The magnet of agglomeration is very strong. Even once necessary transport infrastructure is in place, remote locations may struggle to attract sufficient investors to reverse the tide of labour heading the other way in search of fortune. It would probably require a vast further commitment of public funds to redress the balance. But, paradoxically, any reduction in the march to the cities - and tentative signs have emerged of a slowdown as rising agricultural prices reduce the incentive to leave the land - might constrain growth and government revenue. This in turn also cuts back on the available means to fund the regional support needed to break the cycle. Meanwhile, there is little doubt that money sent home by workers is benefitting the remoter areas. Thus, in the short term there are obvious reasons for the government to look benignly on the migration. The distant provinces will survive, even if largely on migrants' remittances and tourism - already a proven formula, if not a particularly enviable one, for some nations. It is only in the longer term that regrets may surface such as rural decline or social strains in cities. That the Chinese government is tackling the regional challenge is not in doubt. Tomorrow's historians must be left to judge whether it is doing enough. Personally, I find the rush to the cities intuitively disturbing, even if it may be hard to find persuasive economic arguments against it. And how nice it might have been to secure the 2008 Olympics for some part of China in greater basic need of an extra dose of cash and concrete than Beijing. Tony Latter is a visiting professor at the University of Hong Kong
