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Value-Added Rural Vision
New era for China's countryside aims to empower farmers, diversify agriculture and promote a green lifestyle
By Hou Weili | VOL.10 May 2018 ·2018-04-28

China is translating its vision of rural prosperity into reality

Wen Tiejun, 67, sees himself as a typical middle class man. Five years ago, very much a wealthy urbanite, he made a decision which shocked those around him by selling the family's multi-million-yuan property in downtown Beijing and relocating to a village in southeast China's Fujian Province.

"There is no pollution [here], only fresh air, clean water and safe food. This is [a better] life," he told ChinAfrica.

That idyllic lifestyle was something Wen, an agricultural economics expert, found in abundance as a delegate to the Boao Forum for Asia (BFA) Annual Conference 2018 on Hainan Island, especially the clean air, top-level infrastructure and public services.

Wen's decision to move to the countryside was mainly prompted by his growing love for rural life due to his career as an agricultural economist. In order to get closer to rural areas for his academic research, he quit his job in 2013 as head of the School of Agricultural Economics and Rural Development with the prestigious Renmin University of China in Beijing, and joined the lesser known provincial Fujian Agriculture and Forestry University. His reasons for the change were twofold. While seeking a better lifestyle, Wen wanted to achieve concrete results in his research on promoting rural revitalization, which aims to make agriculture a lucrative industry, to turn farming into an attractive profession and transform rural areas into beautiful places to live in.

The Central Rural Work Conference at the end of last year made a major strategic shift from a focus on urbanization over the past decades to achieving rural revitalization in the 21st century. "This is extremely important as it truly places agriculture and rural development as China's priorities," Wen said at the session on Marginalized Rural Asia during the BFA Annual Conference held from April 8 to 11.

Rural prosperity vital

Efficient use of farmland is part of rural reform

The 19th National Congress of the Communist Party of China held in October 2017 highlighted rural issues and proposed the strategy of rural revitalization. A timetable and roadmap to translate the vision into reality were released two months later in the Central Rural Work Conference. "Revitalizing rural areas is a strategy China has made to adapt to new situations in its vast countryside," said Han Changfu, Minister of Agriculture and Rural Affairs, at the conference.

Rural areas and agriculture have entered a new era. Statistics by the Ministry of Agriculture and Rural Affairs show that China's annual grain output exceeds 600 million tons for the past five consecutive years. The annual per-capita disposable income in rural areas reached 13,432 yuan ($2,139). The contribution rate of technological advances in agriculture surpasses 66 percent, showing China's agriculture is shifting from being resource driven to technology driven. In addition, public services and infrastructure in rural areas are also improving.

However, the challenges of inadequate development in rural areas and urban-rural imbalances are significant. "Most notably, the

quality of agriculture needs to be improved; the momentum to increase farmers' income is weak; and the income disparity between urban and rural areas is still large," said Han.

Rapid urbanization over the past few decades has seen the Chinese countryside lose its productive working-age residents and become desolated in some areas. The latest data by the National Bureau of Statistics showed that China's migrant workers totaled 169 million in 2016, nearly 30 percent of the total rural population.

Han said to promote the development of rural areas and agriculture in tandem with urban progress, the life of farmers needs to be improved. "China cannot be a strong country if there is desolation in rural areas," he said.

For Wen, the rural population and market hold great potential for the future of a prosperous China. "Agriculture is the foundation of the nation. It is the reason why China has withstood one crisis after another, like the global financial crisis in 2008 and the devastating SARS epidemic in 2003," said Wen.

Despite being imperative, it is no easy task to translate the vision of rural prosperity into reality. However, in rural matters, Wen is a problem solver. His solution is to introduce the concept of a "sixth industry" for farmers to increase their incomes from the businesses related to agricultural production in addition to their agricultural income, by cooperating with commercial and industrial sectors to integrate production, processing and marketing, and to combine agriculture with tourism and other service industries in rural areas. The concept was first created in Japan.

"Instead of treating agriculture as a single industry, the 'sixth industry' approach makes farmers gain wider added value and enables the sustainable development of agriculture and rural areas," Wen explained. He has adapted the concept so that it meets China's local conditions.

"I like to call it a synthesis of recycling agriculture, innovative agriculture and immersive agriculture," Wen said. According to his explanation, recycling agriculture means changing the way the sector develops, which currently focuses on dependence on the land and use of chemical fertilizers. Innovative agriculture means finding the cultural connotations in agriculture and using that to attract urban residents, young entrepreneurs and investors. Immersive agriculture aims to help farmers earn money from urban dwellers who want to experience agricultural and rural activities. "Fresh air, clean water and a beautiful landscape in rural areas are big assets, but were ignored in the past. Now, with urban residents demanding a green and idyllic lifestyle, these assets could be materialized," he said.

To make the synthesis work, Wen believes China's affluent middle class is vital. "They have the demands to consume such services and possess the necessary capital and expertise in management and sales," he explained. According to the Global Wealth Databook 2016 released by the Switzerland-based Credit Suisse Research Institute, China has the largest middle class in absolute number, totaling 109 million.

Empowering farmers

Modern rural housing

However, despite the important role the middle class can play in future rural and agricultural development, this does not mean that farmers will be marginalized. The plan is to empower farmers so that they can reap the added value accrued by them.

To this end, they need expertise and insurance. The good news is that businesses are keen to get involved. Among them is the New Hope Group, a leading private agricultural enterprise from southwest China's Sichuan Province. "My company will provide financial support to train 100,000 farmers in the next five years," Liu Yonghao, Chairman of New Hope, announced at the BFA, adding that the company will also invest 50 billion yuan ($7.96 billion) to support other projects under the rural revitalization strategy over this period.

In addition, "insurance will help rural businesses weather natural or market losses through risk control," said Miao Jianmin, President of the People's Insurance Company (Group) of China Ltd. The company is also participating in the establishment of a social security network in rural areas so that low-income rural residents will be able to avoid suffering impoverishment brought about by market uncertainties and natural disasters.

To support startups by rural households and migrant workers in the agriculture-related sector, the company has tailored microfinance services by combining insurance and financing. "For example, startups can use their insurance policies as collateral for acquiring loans," said Miao.

These support services have borne fruit. According to the Ministry of Agriculture and Rural Affairs, as of 2017, there had been 7 million migrant workers and university graduates who had returned to their hometowns and started agriculture-related businesses. The number is on the rise, something that is sure to motivate Wen in his ongoing quest.

(Reporting from Boao, Hainan Province)

40 Years of Rural Reform in China

  • 1978 Eighteen farmers in Xiaogang village, in east Anhui Province, signed a secret agreement to divide communally owned farmland into pieces for each family to cultivate, which was called all-round contract, thus lighting the torch for China's rural reform.
  • 1983 In January, a system of contracted responsibilities based on household with remuneration linked to output was first adopted in China in the agriculture sector.
  • 1984 In March, rural enterprises began to spring up.
  • 1985 In January, China started to reform its previous system of state monopoly for purchase and marketing of agricultural products.
  • 1986 In January, rural areas embarked on the path of planned development of the commodity economy.
  • 1990 On February 12, the Ministry of Agriculture issued a document to provide support for the development of rural enterprises.
  • 1993 In November, the Central Committee of the Communist Party of China (CPC) and the State Council decided to extend the term for contracting lands for another 30 years upon expiration. In March, the Chinese Government initiated the poverty-alleviation program (1994-2000) to lift people above the poverty line by the end of the century.
  • 2000 The CPC Central Committee and the State Council made a major decision to implement rural tax and fee reform.
  • 2003 The Law on the Contracting of Rural Land came into effect, legalizing farmers' long-term and secure land-use right for the first time.
  • 2004 China established a direct subsidy system for farmers.
  • 2005 In October, the Fifth Plenary Session of the 16th CPC Central Committee put forward the program of building a new socialist countryside.
  • 2006 China's 2,600-year-old agricultural tax was rescinded from January 1. On February 17, the special product tax and slaughter tax was abolished.
  • 2007 In July, the State Council issued the notice to establish the Rural Subsistence Allowances System to cover all the qualified impoverished farmers nationwide.
  • 2008 The Third Plenary Session of the 17th CPC Central Committee held in October set a goal to double farmers' per-capita net income by 2020 from the 2008 level.
  • 2009 In August, the Chinese Government launched the pilot project of the new type of pension schemes for rural residents, which will achieve full coverage by 2020.
  • 2011 The Central Government invested more than $2 billion to subsidize and award grassland ecological protection.China's grain output totaled 571.1 billion kg.
  • 2012 In January, the State Council issued the National Plan for Modern Agriculture Development (2011-15), putting forward the guiding principle and goal of developing modern agriculture.
  • 2014 In November, the Chinese Government proposed to separate rural collective land ownership rights, contract rights and management rights, so as to further deepen the rural land system reform.
  • 2015 In December, China proposed to expand supply-side structural reforms in agriculture.
  • 2016 China encouraged the development of the Internet-based modern agriculture so as to promote the transformation and upgrading of agricultural industrial chain through modern information technologies such as the Internet, cloud computing, big data and the mobile Internet.
  • 2017 The 19th CPC National Congress put forward the rural vitalization strategy.
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