1. SHOUYING LIU SENIOR RESEARCH FELLOW AT DEVELOPMENT RESEARCH CENTER OF THE STATE COUNCIL, CHINA THE 16 TH ANNUAL WORLD BANK CONFERENCE ON LAND AND POVERTY New Economic Normal and Land Reform in China

2. Contents Traditional Growth Model and Land Tenure System in China China Has Entered An New Economic Normal Land Reform In The New Stage

3. I. Traditional Growth Model and Land Tenure System in China

4. China’s Economic Miracle High growth rate averaging 10% China’s 31 provinces 140 other economies in the world Increasing speed of GDP Growth rate from 1978 to 2013

5. Thanks to Strategy of export oriented industribution. China became the world’s largest manufacturer in 2010

6. China’s rapid urbanization : annual 1.5% urbanization rate

7. Land is the Core Contributing Factor Land rights structure: Rural collective ownership Urban state ownership Land conversion arrangements:  Rural land is converted to urban land through government-led requisition.  Central government utilizes land use plan and land quota to control the scale of land conversion. Land market structure:  Local governments monopolize urban land primary market.  Rural construction land cannot enter into market.  Land transfer income belongs to local governments.

8. 2. Requisition of Rural Land and social unrest From 2005 to 2011, 10,200 km 2 of rural land were requisitioned and converted to state land for urban construction use. Annual requisition of rural land averaged 1,460 km 2.

9. Low Industrial land price have been sustained under the regulated land management system Urban Land Prices: National Average 2008-2013 (CNY/ square meter)

10. Governments’ land sales revenue grew rapidly from 129.6 billion yuan in 2001 to 4.2 trillion yuan in 2013.

11. Collateralized land area and collateral loan amount have both jumped

12. II.China Has Entered A New Economic Normal

13. China’s potential growth rate is projected to slow down in about 2015.

14. China can no longer sustain double-digit growth. Growth rate will first stabilize at 7-8 percent for some years, before dropping to a moderate speed of 6-7 percent. 6-7 percent will be China’s new norm in the future. Source of growth will mainly depend on improving productivity.

15. The peak of China’s annual housing demand is estimated to be between 12 to 13 million units, and is expected to come in 2015. High housing prices can no longer maintain high government land revenue

16. Revenue from land sales as share of total local government revenue(1999-2013)

17. III. Land Reform In The New Stage

18. Land Reform is the core factor supporting the new norm The slowdown in economic growth means China can no longer rely on land as a growth engine. The new growth model focuses on quality not speed. Thus, land supply will shift from quantity increase to improving land use efficiency.

19. The main Contents of land reform in the 3rd Plenary Session of 18th CPC Central Committee Building a united land market Integrating rural and urban areas Reforming agricultural management system separating management right from ownership right and contracting right. Building rural collective construction land market. Reforming land requisition system. Reforming rural homestead system.

20. The Contents of Land Reform Experiments Land reform experiments in 33 counties Core reform of new type of urbanization and rural comprehensive reform. Main contents: rural commercial collective construction land entering into market; rural land taking system reform; rural homestead land system reform. Land reform experiments are permitted by CCCPC.

21. The Possible Effects of Land Reform 1.collective construction land entering into market: Larger development space at developed regions and pre-urban areas; Collective commercial construction land can rent, transfer and mortgage.

22. 2. land taking system reform: Land cost will rise; More farmers’ existing construction land will entering into market directly; More equal allocation of land incremental income.

23. 3.Rural homestead land system reform The assets value of rural residents in pre-urban areas will risen. The development space of pre-urban areas will expand. Restructuring village communities.

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