Chinese Urbanization: Achievements and Prospects to Be Pursued

Headnote

Abstract: This paper systematically reviews the different stages of China's urbanization process since 1949, its achievements and problems it faces. It offers in-depth discussion on the trends of Chinese urbanization, i.e. maintaining rapid growth; making small and medium- sized cities the main driver in development; and focusing on central and western China as the major areas to be urbanized. This paper analyzes new-type urbanization for instance to set up comprehensive urban system that meets the requirements of having a high urbanization level, such as focusing on developing medium-sized cities of one to two million people, using city clusters to encourage population concentration and following an urban construction model that is intensive and compact; and finally this paper proposes policy suggestions for boosting the healthy development of new-type urbanization, including reforming current models for urban-rural governance and establishing development zones, reactivating the normal process of creating cities, and establishing and improving relevant policy systems.

Keywords: Chinese urbanization, development stages, strategic vision

JEL Classifications: ROO, N95

(ProQuest: ... denotes non-USASCII text omitted.)

The 18th CPC National Congress has highlighted the strategic mission to steadily push forward urbanization in China with the belief that urbanization can effectively solve the greatest structural problem facing China's economy: internal and external imbalances. By pursuing the strategy of urbanization, China hopes to effectively boost its internal demand and thus ensure a positive economic momentum of long-term, rapid and sound growth. Since its pro-market reform in 1979, China has achieved huge economic success, created an exportoriented open economic system that is fully integrated with the global economy and global labor division, but at the same time has increased its dependency on external demand. On the one hand, pro-market reform has facilitated 30 years of rapid growth; on the other hand, it has resulted in unstainable economic growth and rendered China vulnerable to global economic fluctuations, causing the problem of imbalances between internal and external demand. In fact, for a big developing country, long-term, rapid and sound economic growth has to be driven by external and internal demands together, which should play their due roles and complement each other to stabilize total demand. The deteriorating global economic situation and China's macroeconomic policy of "maintaining growth" place a greater emphasis on boosting internal demand.

Scholars agree that among measures to increase internal demand, urbanization has the greatest potential for promoting economic growth and accelerating the urbanization process is therefore of great significance. China has entered a phase of rapid industrialization and urbanization. Speeding up urbanization is one of key measures to ensure the country's comprehensive, sustainable and coordinated development. First, it helps increase domestic demand and maintains a good momentum of rapid economic growth. Second, it helps transform the development pattern and facilitates economic restructuring and resource allocation efficiency. Third, it improves people's wellbeing, greatly lifts the living standards and the quality of population, and enhances social harmony and progress. Fourth, it encourages harmonious development between man and nature, facilitates intensive and efficient utilization of resources, thus reducing detriments to environment and ensuring sustainable development of ecological environment. All in all, boosting urbanization is a basic method and solution for solving a series of short-, mid- and long-term problems facing our social, economic development and environmental protection. Reaching an urbanization level of 70% is also one important indicator of fully building a well-off (xiaokang) society and basically achieving modernization.

1. Chinese Urbanization since 1949 and Its Achievements and Problems

Over the past 60 years since the People's Republic of China's (PRC) founding, its urbanization has undergone three stages and the country has obtained significant achievements.

1.1 Three Stages of Urbanization in China since 1949

In general, the pace of urbanization in China since 1949 has gradually picked up its pace and has gone through the following three stages.

The first stage is the starting period with slow development, from the founding of the PRC to the era of pro-market reform (19491978). The newly-founded republic only had an urbanization level of 10.64% in its early years. During the first stage, China went through threeyears of economic recovery, stable development in the first Five Year Plan (FYP) timeframe, the turbulent "Great Leap Forward" and the ensuing adjustment period, and stagnation in the Third Front Campaign Cultural Revolution. However, its urbanization level had only increased to 17.92% by 1978, registering an annual increase of just 0.25 percentage points, which is only one third of the average growth over the past 60 years. The number of county- and prefecturelevel cities only increased by 61, from 132 to 193. This outcome is a result of the fact that China chose an industrialization approach to economic growth that relied greatly on the heavy industry and sought quick results. It is also noteworthy that China started with a very low level of urbanization. In this stage, China put great emphasis on the construction of cities. During the first FYP timeframe, seven cities were given priority, apart from Beijing, with regard to industrial development, namely Taiyuan, Baotou, Xi 'an, Wuhan, Datong, Chengdu and Luoyang; twenty cities enjoyed priority in city expansion, such as Anshan, Shenyang, Jilin, Changchun, and Harbin; around fifteen cities, for example Nanjing, Jinan, Hangzhou, Kunming and Tangshan, were selected for partial expansion; and during the "Third Front Campaign, cities like Shiyan, Chengdu, Lanzhou, Baoji, Xining and Hanzhong were chosen to be developed.

The second stage saw the accelerating development of urbanization during 19782000. Urbanization in these 22 years can be further divided into four phases: educated youth returning to cities, developing township enterprises, strategic priority of the development of small towns, developing industrial parks and migrant labor rushing to cities (overflow of migrant laborers). The urbanization rate rose to 36.22% from 17.92%, with an annual increase of 0.83 percentage points, which is higher than the 60 -year average. The number of county- and prefecture-level cities jumped to 663 from 193 and the number of designated towns (jianzhi zhen) also increased sharply from 2,173 to 20,312 (See Table 2). Chinese urbanization in this stage significantly accelerated for several reasons. First, China's national priority was affirmatively shifted to economic development. Second, the industrialization strategy no longer emphasized heavy industry and instead focused on the development of light, textile industry, which conformed to the economic reality of the time. Third, it carried out firmly the strategy of using central city development to stimulate regional development and prioritized the development of coastal regions. Big coastal cities became key targets of city construction, and at the same time, a great number of small and medium-sized cities, and small towns emerged in coastal regions, for example, Shishi, Dongguan and Kunshan.

The third stage highlights the rapid urbanization since the 21st century (20012010). During this timeframe, China rolled out an official overall strategy for accelerating urban development and saw phases of small town expansion and city clusters development respectively. In 2010, the urbanization rate reached 49.95%, which increased by 1.20 percentage points annually from 2000 to 2010, meaning a higher speed of urbanization. The priority of urban construction in this stage was given to designated towns of favorable geographic location and new city districts near big cities, such as Binhai New Area of Tianjin, Zhengdong New Area of Zhengzhou, and Shenbei New Area of Shenyang. Hence, the size of cities and towns grew. The interactions between cities and towns also increased, thus gradually creating city clusters.

1.2 Achievements of Chinese Urbanization

The urbanization rate in China rose to 49.95% in 2010 from 10.64% in 1949, an annual increase of 0.61 percentage points. This level of urbanization has basically satisfied the requirements of social economic development:

Firstly, urbanization has clearly picked up in China and the share of urban economy in the national economy has increased gradually. Since the beginning of the 21st century, urbanization growth in China has basically been over the rate of 1 percentage point per year, significantly higher than the global average of 0.2 percentage points and also higher than that of many emerging economies. In addition, the urbanization level of China is basically commensurate with the country's current economic development stage. In 2010, China's GDP per capita was around USD4,000 and the urbanization rate was near 50%, while the global GDP per capita was USD8.000 and the global urbanization rate was 50.5%. This shows that there is no derail between the level of development of industrialization and urbanization. In terms of employment in the secondary and tertiary industries, people employed in the two industries in 2008 accounted for 60.4% of the total. Deducting their healthy employment figures in rural China, it tells that our urbanization level was slightly lower than the employment rate created by industrialization. At present, the dominance of urban economy in the national economy is increasing, as illustrated by the fact that the gross economic output of cities of prefecture-level and above in 2008 alone accounted for 64.2% of the total GDP.

Secondly, development of urban systems has made headway. Currently, China has a basically complete urban system made up of big, mediumsized and small cities as well as small towns. Specifically, China now has an urban framework of "655+20,000 (cities and designated towns respectively)." City clusters are slowly taking shape and it now has four mature city clusters and 11 semi-mature ones (See Table 4).

Thirdly, urban layout is scientifically planned. At the macro-level, urban layout in China is moving towards "dispersed big cities, concentrated small towns." Specifically, cities are densely located in eastern China, scattered around the central part and are scarce in the west. This situation is in accordance with realities of geography and environment in China. At the micro-level, China has more complicated spatial structures within cities. City downtowns, suburbs and suburban counties together constitute an ever more evident city spatial structure.

Finally, great progress has been made in China's urban construction, with increased urban population capacity and a higher level of modernity in cities. The total area of cities increased significantly; housing conditions have been improved; the infrastructure system, including city transportation, water supply, electricity, heat, city forestation, heath service and telecommunication service, have continued to be bettered. In 2010, China's urban land totaled 41,000 square kilometers, 34,000 square kilometers higher than in 1981; per capita housing space in urban China reached 27. 1 square meters, 20.4 square meters higher than in 1978; urban coverage of water and gas supply was 93.8% and 87.4% respectively, 40.1 percentage points and 75.8 percentage points higher than the figures in 1981 respectively; the number of public transport vehicles for every 10,000 people was 10.2, 7.7 higher than the figure of 1986.

1.3 Problems of Urbanization in China

First, China's urbanization level is still not high enough and it is of low quality. One major reason is the existence of a huge number of urban villages. Compare to current the level of industrialization, the level of urbanization lag behind significantly and the urbanization rate in 2010 was lower than the average rate of countries with relatively the same per capita GDP, which was 55%. Meanwhile, migrant workers are not able to settle down in cities, which probably have lowered down the actual urbanization level. Low quality of urbanization can be seen from urban villages, shantytowns and derelict small towns. Urban villages, which exist in large numbers in many Chinese cities, are to some extent "slums" with Chinese characteristics, and this shows that the urban development pattern is extensive and unsustainable and that China still faces a lot of problems in terms of enforcing city planning and managing city construction. The shantytowns were created by an approach following the planned economy period, which "put economic production over people's living requirements." During the years of pro-market reform, due to various reasons, these regions were one step behind others and therefore the shantytown problem was left unsolved. The appearance of derelict small towns is caused by economic realities of the current economic stage. During the early stage of urbanization, China focused on big and medium-sized cities and neglected the development of small towns. Although China proposed to make "small towns a key part of the big urbanization strategy" quite early and prioritized the establishment of small towns, their development, has constrained China's economic prowess and the realities of its current development stage, resulting in bad infrastructure, weak urban functions and low quality urban construction.

Second, the cities are not reasonably sized. The big ones are too big and the small ones too small - there are insufficient number of mediumsized ones in between relatively. Apart from this anomaly, big Chinese cities also have a weak economic radiating capacity. China is not in short of mega-cities with 5 million or even 10 million people, which are now under serious threat from "urban disease.1 " The vast number of designated towns and market towns are too small and showing signs of dereliction. There are too few medium-sized cities, which can avoid both urban disease in big cities, and the low economical efficiency in small cities. Therefore, people migrating from the countryside to cities lack necessary choices and do not go through a transition phase. The weak economic radiating capacity of big city is related to the relatively low ratio of their population to the country's total urban population; the ratio of population living in clusters of big and medium-sized cities, especially the big ones, to total urban population is significantly lower than the international norm. Take for example the ratio of the population living in clusters of cities of over 1 million people to total urban population, in 2005, the Chinese figure was lower than not only that of developed countries like U.S., United Kingdom and France, but also that of Brazil, Mexico and Argentina. City clusters in China are just beginning to grow; they do not have close interactions or large populations and they are not highly concentrated and not very appealing to potential residents. At the moment, Chinese cities are generally in a phase of aggregating population and industries and have weak economic radiating capacity. Although there also exists a trend to develop suburbs and decentralize city structures (i.e., to transfer industries and population), it is not strong and prevalent (suburbanization does not mean economic radiation, but spreading of city itself).

Third, problems abound in terms of macrourban regional layout and internal urban space layout. For instance, the number of cities and towns are disproportional to the number of villages and the boundaries of these cities and towns are not clearly outlined. For macrourban layout, the problem is that there are too few cities, too many villages and the designated towns are too small. Functional zones of cities are intermixed in chaos: boundaries of the city core, the intermediate area, the city fringe, suburbs (county-level suburban cities) and suburban counties are not clearly delineated, resulting in mindless urban sprawl. This is one of the reasons behind the "urban village phenomenon."

Fourth, the urban-rural divide is not effectively controlled. The gap between urban and rural continues to widen. The urban-rural relationship is strained, and the urban-rural dual structure still remains prominent. Basic public services and social security have not been provided equally and across-the-board to the urban and rural populations. In addition, the Chinese urban and rural populations do not have virtuous interactions: the progress of urbanization failed to effectively and steadily reduce rural population that is reliant on land. In the urbanization drive, problems have occurred during land requisition, housing demolition and relocation and city renovation processes, including not abiding by the law, not strictly enforcing the law and adopting simple and rough working methods, which have caused some social tension and undermined social stability.

Fifth, many ecological and environmental problems have appeared in the urbanization process. Occasionally, some cities pass along their environmental pollution to the countryside and the countryside provides unhealthy food to cities. So-called "urban villages" are usually the blind spot and potential threat to health and sanitation. They are not only bad for a city's image, but also a great threat to urban sanitation and are likely to become the source of urban epidemics.

2. Basic Trends of Urbanization in China

The next 20 years will still be a period of rapid urbanization. Because of its unique national realties which include huge population, scarce land and intense resource and environmental constraints, it is inevitable that China pursues a new approach to urbanization with Chinese characteristics and makes full use of its latecomer advantages. The basic trends of this new approach are as follows.

2.1 Chinese Urbanization Will Continue to Grow at a Fast Speed

According to the general pattern of urbanization, if urban population reaches 30-70% of the total population in the future, urbanization will be at a phase of rapid development, and the 50% urbanization level will be a summit at which the growth rate of urbanization reach its most high point. According to this thought, we can divide the rapid growth period into two stages: one is the accelerating rapid growth stage, in which the urbanization level is between 30-50%; the other is the slowing-down rapid growth stage, in which the urbanization level is between 5070%. So that, in the upcoming 20 years, Chinese urbanization will continue to grow rapidly, but the pace will slow down and gradually experience a peak period and a near turning point, at which the grow rate will slow down to a level line; it is estimated that the turning point of Chinese urbanization will occur when urban population accounts for 65-75% of the total population, that is, around 2030.

In light of the current stage of urbanization and its objective, we make the following forecasts of Chinese urbanization in the next 20 years: by 2030, urbanization level of China will rise to 63.52% from 46.59% in 2009 if it increases by 0.8 percentage points annually (the World Bank forecasts that the 2030 figure would be 68% and OECD predicts a level of 66% by 2025, both of which are quite optimistic forecasts). The forecasts of different stages of urbanization in China are: from 2009 to 2020, Chinese urbanization level will increase by 0.9 percentage points every year. In order to build an acrossthe-board xiaokang society; from 2021 to 2030 China will increase its urbanization level by 0.7 percentage points per year for building a more inclusive society. In 2050 Chinese urbanization will further improve and reach a higher stage of development (see Table 5).

2.2 Medium-Sized and Small Cities and Towns Will Become the Main Driving Force behind Chinese Urbanization

Many scholars have agreed that it is very difficult to reach a high urbanization level in China only through the existing 655 cities. Therefore, great efforts must be made to develop new cities while continuing to improve the quality of existing ones. Only by doing so will China achieves its urbanization objective. The increase of the number of cities is mainly accomplished by building medium-sized and small cities on the basis of county seat towns and village-level designated towns. China now has more than 2, 100 county seat towns (most of which have not grown into small cities) and over 18,000 village-level designated towns. In the future, the urbanization of these towns must be accelerated first and foremost.

2.3 Central and Western China Wfll Become the Focal Point of Chinese Urbanization

In 2008, the urbanization level of eastern China reached 56.0% and the urbanization growth rate is beginning to decline. In contrast, the urbanization rate of central and western China was only 39.6% in the same year (see Table 6). Central and western China have more land resources and twice the population when compared to eastern China. Increasingly, the labor-intensive industries of the east are starting to relocate to central and western China. Therefore, the focal point of Chinese urbanization will be there.

3L The Meaning of a New-type Urbanization Strategy

The global urbanization level reached 50% in 2008 and entered a stage of peak development. Although the Chinese urbanization level was 5.5 percentage points lower than the global average, China was also in the range of peak development stage. And since industrialization and urbanization in China is and will be growing very fast for a long time to come, its annual growth rate of urbanization is far higher than the world average. We are confident that Chinese urbanization level will catch up with and surpass the global average in the next ten years and gradually enter into a development stage of high urbanization level. In order to maintain the long-term, rapid, sustainable and healthy economic growth and fulfill the task of building a modern China, it is crucial to explore a newtype urbanization5 approach and devise a newtype urbanization strategy. This new strategy must be designed in accordance with the general pattern of global urban development while taking into account the best practices of urbanization of other regions and countries and considering the specific Chinese realities and its current stage of development. Under the context of globalization, the new-type urbanization approach with Chinese characteristic means: first, establish a fullfledged urban system (nation-wide land urban system) that meets the demands of achieving a high urbanization level; second, prioritize the development of medium-sized cities of 1-2 million people; third, make city clusters the main method for population concentration; and fourth, build compact cities and towns in an intensive way.

3.1 Establish a FuU Fledged Urban System That Meets the Demand of Hi^i Urbanization Level

Developed nations that have finished industrialization and urbanization all have established full-fledged urban systems and have created a complete regional social economic development system centering on human urban settlements. They have a vast number of cities and towns (urban settlements account for a larger share in total settlements than rural ones), and have reasonable structure of big, mediumsized, and small cities and small towns (which is basically a pyramid structure of 1:10:100:1000). And their spatial distribution is balanced (meaning that they can effectively cover the entire nation). As a matter of fact, urban system development is of vital and lasting importance. To build a highly urban China in the future, China first needs a similar top-level design to create full-fledged urban system and confirm the trend and objective of Chinese urbanization and urban construction. It is vital and of lasting importance to healthy industrialization, effective utilization of land resources and environmental protection, if a full-fledged, reasonably structured and balanced urban system that coordinates the development of big, medium-sized and small cities and small towns is established. Such an urban system would greatly boost urbanization and social economic development and make sure that land development and environmental protection grow in a concerted and sustainable way.

At present, China has created a basic spatial framework for an urban system with 655 cities and 20,000 designated towns. The basic spatial layout is generally in accordance with the principle of "dispersed big cities and concentrated small towns." Nevertheless, it is still far from a full-fledged urban system that meets the demand of high urbanization level. To be specific, the cities and city clusters have not become regional economic centers in the real sense: there are still too few cities, little urban population and too much country villages, the number structures of urban and village is not appropriate. In addition, the cities are not able to functionally cover the entire nation. Many studies have shown that it would be very difficult or even impossible to meet the demand of urbanization and industrialization only by relying on 655 cities, especially when more than 300 of them are prefecture -level cities. Therefore, China must put great effort in developing nearly 3,000 county seats after securing the growth of prefecturelevel cities. Only then will it be possible to effectively meet the demand of urbanization and industrialization in China for cities and land.

As required by top-level design, a fullfledged urban system in a highly urban China would fit the following description. First of all, the urbanization level would be over 70% and the urban population would reach 1.05 billion (based on the latest prediction of peak Chinese population: 1.5 billion). If urban China is to be modernized, then Chinese urbanization level should reach about 80%, the urban population would be 1.2 billion and the rural population would remain 0.3 billion. Second, China should build an urban system consisting of 2,000 cities and 18,000 designated towns. Among them, there would be about 35 big cities (with over 5 million people after adjusting for reasonable size of the entire city area and cities in developed nations), about 200 medium-sized cities (with 1-5 million people) and 1,800 small cities (with 0.2-1 million people).6 Third, the specific urban layout and urban population distribution would be as follows: the existing 31 provincial capitals and four big coastal harbor cities (i.e. the 35 cities listed in the China Statistical Yearbook) would be expanded into big cities of around 5 million people and together would be home to 0.17 billion urban population. The existing 300-some prefecture-level cities and prefecture capitals would be built into cities of around 1 million people, accommodating 0.3 billion urban population in total. And the existing over 2,000 county-level cities and county seats would grow into cities of over 200,000 people and they would hold 0.4 billion people. The rest of the designated towns should have a population of about 10,000 people and contribute 0.18 billion urban residents. An urban system of such scale would basically meet the demand of achieving high level and intensive urbanization.

3L2 Prioritize the Development of MediumSized Cities of 1-2 Million People

Compared with developed nations, China's urban system has a serious problem: there is only an insufficient number of medium-sized cities and their population is relatively too small. The lack of these cities in this kind seriously undermines the performance of the urban system as a whole. Therefore, one future focus would be on expanding the number of this kind of city, which could become the breakthrough in coordinating the development of big, mediumsized and small cities and small towns.

There have been various studies on the correlation between urban population size and social economic benefits showing that an urban population that is too large or too small may have significant drawbacks. Therefore, in light of China's particular realities, China should prioritize the development of mediumsized cities of 1-2 million people in the future urbanization drive. Measures should be taken to restrain the growth of cities above and below this scale of 1-2 million people: the purpose of restraining cities above this scale is to prevent the so-called "urban disease" and the restraining of cities below this scale would save precious land resources. Following this logic, the author proposes a list of cities to be marked for priority development in the future (see Table 7). Table 7 shows that: there are a total of 196 cities of 1-2 million people planned for priority development in the future, 36 of which would increase their population to 2 million and 160 of which would increase their population to 1 million. This spatial distribution is in line with the distribution of population and difference in natural conditions in China. As these key cities grow, the population distribution across China would be greatly optimized. With the population of the New Eastern China continuing to rise, the percentage of eastern population in total population would increase to about 55% from 45% in 2008. The population of the Greater Central China would decline slightly, facing much less population pressure and accounting for around 40%, down from 51% in 2008. However, the population of the Far Western China would probably remain at the same level, or experience a slight decrease.

3.3 Make City Clusters the Main Method of Population Concentration

To implement the strategy of coordinating the development of big, medium-sized and small cities and towns, China must push forward the construction of various city clusters. A city cluster is an advanced form of urbanization and is the best organization form for integrating urban and rural China and renovating city cores. On the one hand, it can facilitate population concentration and help solve the issues relating to agriculture, the countryside and farmers. On the other hand, it can reduce population pressure on big cities and ease "the urban disease." In fact, a city and its hinterland are closely connected. Such tight connections give rise to urban circle and city cluster respectively. Starting from 1970s, many countries have seen rapid growth of city clusters and they have become a major form of global industrialization. In the United States, a "city cluster" is called a connected metropolitan area, which is a cluster of several major metropolitan areas. City clusters are able to cover more land area, facilitating full-scale development of land resources. At the moment, city clusters have only just begun their development in China and their growth will increase in the future, before becoming a major form of concentrating population and driving the urbanization process.

In terms of its spatial structure, a city cluster is the equivalent of a special economic zone in China. When creating city clusters, China must respect the boundaries of different regions, integrated economic zones and administrative zones (with some exceptions) and select adjacent cities that have close economic ties, share the same development objectives and enjoy similar natural conditions and resources. At the same time, the city clusters must be able to cover the entire nation (which is different from the situation in America). In light of these requirements, the author offers the following proposal for creating city clusters and functional economic zones in China and points out possible direction of their future development.

According to the above proposal, China would have as many as 74 city clusters (Taiwan not included). In terms of development stage and maturity, city clusters can be divided into mature ones, semi-mature ones, growing ones, and will-be-formed ones. There are four mature city clusters (Liaozhong City Cluster, BeijingTianjin-Hebei City Cluster, Yangtze River Delta City Cluster and Pearl River Delta City Cluster), eleven Semi-mature city clusters, including Jizhong City Cluster, Lubei City Cluster, Ludong City Cluster, Ning-Shao-Zhou City Cluster, West Side of Taiwan Strait City Cluster, Yuedong City Cluster, Central Plain City Cluster, Wuhan City Cluster, Chang-Zhu-Tan City Cluster, Central Shannxi City Cluster and Cheng- Yu City Cluster (see Table 8). Among the rest 59 city clusters, there are 28 growing and non-existent city clusters respectively.

In terms of spatial distribution, there are 29 city clusters in the New Eastern China (including three in Taiwan), including four mature ones, six semi-mature ones and ten other types of city clusters. This means that the existing mature city clusters are all located in the New Eastern China. There are 36 city clusters in the Greater Central China, which has no mature city cluster and only 3 semi-mature ones and the rest are either growing or will-be-formed city clusters. There are 12 city clusters located in the Far Western China, also without mature city clusters. Out of the 12 clusters, two are semi-mature and the rest are either growing or will-be-formed city clusters.

&4 Build Compact Cities and Towns in a More- Intensive Way

With regard to resource utilization, urbanization's goal is to build human settlements of a certain scale and intensity, and to share the infrastructure and public services with the society. It is essentially an economic phenomenon. As a matter of fact, the city is in itself an intensive method of using land resources. Therefore, urbanization will facilitate the intensive utilization of land. For a certain region, as it urbanizes, the number of human settlements there will continue to drop. While population concentrates in cities, if population growth declines below the rate of population concentration, a significant amount of land resources in this region will be freed. However, as the world's population continues to rise and construction land further expands, this has undermined the sustainable development of human society. Moreover, construction land exerts detrimental effects on the environment. Therefore, cities must make a more intensive utilization of construction land. Developed nations emphasize a more intensive use of land, perhaps for the purpose of protecting the environment. For China, this is also the case, but ensuring food security for 1.3 billion people is more important.

Unlike developed nations, China has a huge population but relatively little usable land. Most of China is mountainous. China is also at a stage of rapid industrialization and urbanization. This reality has resulted in a highly prominent conflict between pushing forward industrialization and urbanization and protecting 1.8 billion mu (120 million hectare) of arable land. Therefore, how to balance urban land usage and arable land protection has become a serious question worth contemplating in the process of more intensively promoting industrialization and urbanization. The model for building more intensive and compact cities must follow the following requirements. First, urban space must be restrained within a certain area. Every city and town should have a legally delineated boundary, which cannot be breached arbitrarily. Urban space cannot be allowed to expand mindlessly at a low cost because this would waste land resources and also trigger all kinds of social conflicts. Second, urban land per capita should be strictly controlled under a certain level. China has promulgated standards that should be met by various kinds of urban land and rural construction land. Urban construction must be carried out in line with these standards. At the moment, Chinese cities and towns of various scales and rural construction land have to differing extent exceeded the standards set by the government. Strictly enforcing these standards would undoubtedly improve the intensive utilization of urban land, which would on the one hand satisfy urban demand for more land and on the other hand free a great deal of land for farming.

Third, cities should try their best to use nonarable land for urban expansion. A good choice for expanding urban land is to "use mountains or the sea." By "using mountains," cities should choose such non-arable land as mountain land or waste land (admittedly, mountain land can be cultivated into arable land instead, but it requires large scale construction of terrace fields, which probably incurs higher economic and ecological cost) to develop industry and expand their physical space; by "using the sea," cities should fully take advantage of non-arable beach land in coastal regions and their ports to develop portrelated industries and enlarge city space. This approach ensures that urbanization has adequate land and protects precious plains as arable land.

4 Policy Suggestions for Boosting the New-typeUrbaiiization Process

41 Reform the Current Rural- Urban Governance Model

Currently, urban and rural areas in China are mostly co-governed, i.e. setting urban and rural area as city and using city to drive the development of counties or townships. This model is also called "county governed by city" and "towns and townships governed by city" model. The original intention of setting urban and rural area as city is to integrate rural and urban development, and some nations and regions also implemented similar broad-area governance models, such as South Korea, Taiwan and Japan. But these models have not been widely adopted and cities are only merged with the counties they are located in. Because urban and rural areas have two significantly distinct ways of land utilization, co-governance of the two areas fails inevitably to balance and coordinate the interests of different groups (thus abandoning normal market adjustment mechanism). The drawbacks of this model of setting cities are apparent. Many years of Chinese practice show that this model has deviated from its original intention, doing more harm than good in general.

First, urban space expanded mindlessly without necessary and effective constraint mechanism. China went on the road of decentralized urbanization, resulting in a huge waste of land resources. Due to "coordinated" governance, city and towns became "supervisors" of villages and townships, stripping the latter two of necessary platform and strength to compete with the former two in land usage. Villages and townships were not able to stop urban space from unconstrained sprawl. This has resulted in prosperous urban construction across China and in the process a great deal of rural land was taken cheaply, posing a direct threat to national food security. It should be noted that on the one hand, it is inevitable that urbanization consumes a certain amount of land and sometimes quality arable land (because the land suitable for farming must be suitable for settlement). On the other hand, population concentration caused by urbanization should free more land and help increase the amount of arable land. However, because of inconsistency in the pace of consuming and freeing land and disparity in the land that is consumed and freed, urbanization has affected the amount and quality of arable land in the short run, hence influencing food security. Of course, there also exists a question of value judgment: which is more important, urbanization or food security? If both have the same weight, then urbanization and food security must be balanced.

Second, social economic resources are overly concentrated in cities and towns. This has turned coordinated rural-urban development into only urban development, straining the rural-urban relationship and also deviating from the objective of integrated rural-urban development. Due to the practice of establishing an entire area as city, rural development has clearly been undermined. It is unquestionable that urban-rural divide has widened. To accelerate their development, cities and towns usually retain resources and policies allocated by higher authorities for their own use, which seriously damages the rightful interests of the villages under their jurisdiction. Moreover, in the process of urban expansion, disputes over land acquisition occur quite often and are a highly negative factor in building a harmonious society.

Third, it is difficult to improve urban development models and increase construction quality. Urban development is not just an increase of number and an expansion of space, but more importantly the enhancement of urban quality and the level of modernization. After more than 100 years, New York City still occupies that big an area (about 800 square kilometers) and it still has only five administrative zones. It did not choose to expand its space, but instead increased urban quality, ultimately becoming a global metropolis of the finest quality, not of the most population. Its history tells that the urban space of a city is not an indicator to measure its level of modernization. How to spend on urban development is indeed a question of institution.

Fourth, the current urban-rural governance model deprives other villages and townships within a county to be established as city. This has resulted in two unreasonable phenomena: townships of over 10,000 and 100,000 people cannot be established as cities; county-level cities exist under prefecture-level cities; many districts within a city are scattered across it and are not adjoined.

To prevent the above-mentioned problems from arising, the current "urban-rural co- governance" model should be changed into (or restored as) "separated urban-rural governance" model; the model of approving the whole administrative area as city should be altered into "delineating partial area as city." The rationale behind this change is as follows. First, continue to delegate power to lower levels of authority, increase the number of market players and further invigorate regional economic and urban development. The model of "delineating partial area as city" is good for the protection of arable land and intensive urban development: it creates a necessary level-playing field for land resource utilization; affirms urban-rural equality and brings rural-urban integration back on track; facilitates the increase of economic radiating capacity and makes cities and county areas under their administration form closer relationships; increases the quality of urban construction and boost the modernization of urban development; helps new cities and towns use non-arable land, such as wasteland, abandoned beach land. Correspondingly, urban management could be divided into three levels, central, provincial and county government, putting suburbs under the jurisdiction of county-level cities. Second, the "separated urban-rural governance" model is still the mainstream for governing urbanrural areas across the globe. At present, some developed nations have altered or increased the level of urban management, for instance lifting the jurisdiction from county to province (or state), and even directly to central government (or federal government). However, they did not change the model of "separated urban-rural governance" and "delineating partial area as city" at all.

42 Reform the Currant Mode! of Establishing Development Zones

Currently, development zones in China are basically established with comprehensive functions. Even though some have names denoting specialization, they are in fact comprehensive development zones in terms of their space and functions. It should be admitted that the establishment and rapid growth of development zones on the basis of international experience greatly boosted Chinese industrialization and urbanization, making development zones one of the most significant forms of urban expansion and the starting point and prototype for building many new cities. It is fair to say that development zones have made undeniable contributions to Chinese urbanization, but many urgent problems emerged during the rise of development zones.

First, development zones are responsible for too many functions and grow mindlessly, thereby undermining the sound development of the original city it relies on. A development zone has an industrial area, a commercial area, a logistics area, a financial area, and even a recreation area, which weakens its ties with the city and the overall performance of city functions. In addition, development zones are mostly run independently, creating redundant agencies, wasting resources and sometimes even causing the demise of relevant functional zones or industries in the original city.

Second, there are too many development zones covering too large an area, disrupting the implementation of the reasonable urban layout and overall urban planning. Development zones are established at the national, provincial, prefecture, county, township and even village level. They are set up without clear order and occupy inappropriately large areas, leaving a great deal of land uncultivated. Moreover, development zones often turn out to be "zones within zones" in urban spatial layout, disrupting overall urban layout and creating chaos in administrative zoning and overall urban planning. If a development zone is large enough to establish a new urban district, then it should be established as a district following normal procedures and be taken into account in the overall urban planning, ensuring the integrity and continuity of overall urban planning.

Third, development zone are the direct perpetrator of mindless urban sprawl and the contentious area with many problems concerning urban construction. The development zones established in the suburbs especially need to balance the relationship and interests between the expanded urban area and original residents in suburbs and at the same time deal with the problem of distinguishing internal functional zones and connecting with the cities they rely on. All sorts of problems arise in these newly expanded lands.

This paper holds that in order to solve these problems, we should follow the theory of reasonable layout about industrial point, industrial area, industrial junction and industrial belt in classic regional economics, i.e. the theory of building industrial complexes (in fact, this theory is the popular industrial cluster theory, while in Britain it is called regional permit system that allows industrial activities only in some designated areas). To be specific, this paper recommends reforming the current model of comprehensively creating development zones and separating the establishment of industrial parks from the establishment of new districts. The establishment of industrial parks should be conducted in accordance with the abovementioned theory of industrial cluster, which would create an urban zone with clear-cut functions. It would at the same time save land resources and facilitate urban management, without disrupting the existing urban system. This is a correct form of industrial space expansion. Industrial concentration is a basic trend of current urban function distribution adjustment. The establishment of industrial parks with single function would offer necessary adjustment and control over the unordered industrialization process, realizing the concentration of industries in industrial parks and eliminating previously unreasonable industrial layout. In general, industrial parks are divided into comprehensive and specialized parks, which are both major functional zones of a city with only a single function and would not be mixed with residential, commercial and culture zones. The experience of developed nations shows that a big city can have a comprehensive industrial park, three to four specialized industrial parks; a medium-sized or small city can have two to three specialized industrial parks; a small town can have one to two specialized industrial parks; villages and below are not permitted to set up industrial parks. The area of any industrial parks must be controlled within less than one to two square kilometers. If this recommendation is carried out and comprehensive economic zone is outlined, industrial parks could to some extent replace the major-functional zones (according to this program, the whole country could be divided into four kinds of major-functional of zones: the structure-adjusted zone, the priority-developing zone, the restrict-developing zone, and the developing- forbid zone).

New districts can be built on the basis of industrial parks with single functions or create several industrial parks after they are finished. The establishment of new urban districts must be carried out strictly under the overall urban planning, ensuring that the functional zones of new districts be connected and coordinated with the overall urban layout and satisfy new demands of industrial parks with the districts at the same time. Therefore, although the systems for creating the two kinds of areas should be split, in practice the two are closely related and should cooperate to achieve reasonable layout and complement each other.

43 Reactivate «he Normal Process of Creating Cities

At present, a crucial factor affecting the development and improvement of urban system in China is that under the context of accelerating urbanization, the normal process of creating cities has been suspended for as long as 10 years for no reason at all (during which time only designated towns are allowed to be set up, that is to say only the strategy of small town development was carried out). This process now is still in stasis (the policy was only relaxed to allow the establishment of county-level cities). In light of this situation, reactivating the process of creating cities and accelerating the pace of transforming designated towns to cities has become the key policy measure to build a fullfledged urban system consisting of "2,000 cities and 18,000 designated towns" in China and boost the development of increasingly popular city clusters.

44 Introduce and Improve Relevant Policy Framework

It is an objective requirement of social economic transition to accelerate the urbanization process. Urbanization is a very complex, systematic process of social economic development, which would cause earth-shaking changes in economic structure, industrial layout and life style. To maintain the sound and smooth development of urbanization, China as a latecomer country should rise up to the major problems in the urbanization process and adopt relevant policy measures to tackle them.

First, China must establish new institutions and mechanisms that effectively boost urbanization. After restoring and accelerating the process of creating new cities, city governments should transform their approach from "running cities" to "city planning" and "supervise the implementation of city planning." The task of "running cities" should be left to the market and governments should create a mechanism of market-driven urbanization. When supervising the implementation of city planning, governments should put great efforts in centralized and in-time renovation of "urban villages"; improve the planning standard of urban infrastructure, strengthen urban infrastructure construction and effectively increase its capacity to attract more population. Currently, urban infrastructure in China is basically directly governed by city governments and directly run by municipal engineering administration together with specialized companies. Looking forward, city governments should increase the efforts of social and market reform in urban infrastructure. Urban infrastructure should be put under the management of a centralized urban public assets management agency and run with relevant management models according to their different nature.7

Second, China must build a full-fledged planning mechanism. China should further strengthen constraints on urban planning and strictly implement the Urban-Rural Planning Law and relevant regulations and policies, ensuring that a new round of urban planning is made scientifically and carried out under strict supervision. China should also strengthen urban system planning and promulgate a plan for developing key city clusters in China as soon as possible. Big cities should prevent urban sprawl and stop themselves from "hollowing out"; medium-sized and small cities should not expand mindlessly; small towns should be forestalled from emerging in large numbers. Urban infrastructure must be planned in coordination, balancing ground and underground infrastructure development and reducing the number of "vanity projects." Participation of various players should be emphasized in urban planning, which should produce detailed description of different stages of infrastructure construction, and forms, scope and role of social participation.

Footnote

* Corresponding author, Liu Yong: [email protected]

Footnote

1 Problems such as traffic congestion, pollution, high crime rates in big cities.

Footnote

The New Eastern China covers 4 economic zones and 13 provinces, including three north-eastern provinces, BeijingTianjin-Hebei-Shandong economic zone , Shanghai-JiangsuZhejiang economic zone, and Guangdong-Fujian-Hainan economic zone.

3 Greater Central China covers 3 economic zones and 14 provinces, including provinces in the middle and upper reaches of Yellow River (Shanxi, Gansu, Ningxia, Shan'xi and Henan), Yangtze River (Sichuan, Chongqing, Hunan, Hubei, Jiangxi and Annui), and Pearl River (Yunnan, Guizhou and Guangxi)

4 Far Western China covers 3 economic zones and 4 provinces, such as Inner Mongolia, Xinjiang, Qinghai and Tibet. The figures in () refer to urban population (0,000) of these cities in 2007.

Footnote

5 New-type urbanization is featured by three mores: more intensive, more economized, and more districted use of land.

6 If calculated on the basis of statutory population of CBD and the scale of cities and towns of developed nations, then there would be about 20 cities of over 500,000 persons, 200 mediumsized cities of 200,000 to 500,000 persons, and around 1,800 small cities of 50,000 to 200,000 persons.

Footnote

7 Liu Fuheng. 1998. "Renkou Chengshihua he Gongyepin Xiangduishengyu" (Population Urbanization and Relative Surplus of Industrial Products), China Industrial Economics, Issue 04.

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