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IS she a rural girl or city resident? Xu Shu doesn’t know.
Xu works as a waitress at a small restaurant in the western part of Beijing. She is in her 20s, and moved to the capital from a village in Gansu Province.
In August, China announced that the country’s urban population had officially surpassed 50 percent. But Xu can’t say on which side of the 50-percent divide she stands. Leaving her rural hometown for years, Xu still feels like an “outsider” in the city of Beijing.
Global expectations of China are climbing; but the country is now facing a new, major domestic challenge: the further urbanization of the country, and more importantly, of its 230 million migrant population.
Urban explosion
On August 14, the Chinese Academy of Social Sciences (CASS) released The Urban Blue Book: China City Development Report No. 5. The report cites that urban dwellers now make up 51.27 percent of China’s total population – a significant change in the country’s social structure.
Xu and other new urban denizens like her, account for the increase but still can’t see themselves as “urbanites.”
“I don’t have a Beijing hukou,” she explains. “I will never be a Beijing resident.” her family’s hukou booklet says what she is: a member of the “rural population of Gansu Province.”
The hukou system, a household registration system unique to China, attaches a person to a particular place. People are registered in two categories: agricultural and non-agricultural. People with a non-agricultural hukou are far more likely to receive pensions, basic health care, and unemployment insurance under the social security system of the city.
Herein lies the biggest problem facing migrant population from rural areas. Simply moving to a city will not give them access to the social services available to someone with non-agricultural hukou.
Statistics show that endowment insurance, medical insurance and unemployment insurance in China are only accessible to 18.2 percent, 29.8 percent and 11.3 percent of all migrant workers across China, respectively.
Xu is in a relationship with a young man. he is from another village and also came to Beijing to seek work, but she’s not confident about their future as a couple in Beijing since life will get tougher with every future milestone. housing, medical bills, and education costs for children are all tied to hukou status. “In a few years, I might have to go back to my hometown to marry someone else,” Xu says.
Beginning in the 1990s, China’s farmers flooded into cities to meet the increasing demands of the country’s industrialization boom. But even though their role in urban development has been crucial, migrant workers still feel there is a glass wall separating them from their city resident neighbors. Many migrants keep their land, believing that they will ultimately have to return to their fields. The land can remain idle for years, which in turn may affect national food supply.
“If the over 200 million migrant workers who aren’t really urbanized are taken out of the equation, the real urbanization rate in China is only 36 percent,” says Yang Weimin, Deputy Director of the Office of the Central Leading Group on Financial and economic Affairs at an international seminar on housing policies on August 7.
Long Yongtu, former Vice Minister of Foreign Trade and economic Cooperation (now Ministry of Commerce), elaborates on this gulf. “The biggest problem of China’s urbanization,” he says in a forum held in late August in hebei Province, “is to find a way to turn migrant workers into real urban residents, providing them with equal access to social security, housing, medical care and public education.”
Long believes that urbanization has to be slowed down if necessary in order to solve these problems.
Surging ahead
Experts say that given China’s present economic state, a fast urban growth is in need.
China’s urbanization lags behind its booming industrialization. According to a report published by Reuters, the Chinese rate of urbanization compared to industrialization is 1.09 (51.3 percent versus 46.8 percent), while that same rate globally is 1.95(50.9 percent versus 26.1 percent).
China’s economy has grown at its slowest speed since the second half of 2009, with GDP growing 7.6 percent in the second quarter of 2012. Determined to reverse this slow domestic growth, China has shifted focus toward urbanization.
In July, Vice Premier Li Keqiang pointed out that urbanization is a major driving force for domestic demand and an important base for the adjustment of economic structures.
Some experts estimate that China’s rate of urbanization will further climb, nearing 60 percent by 2020. This is expected to bring investment and raise consumption, both of which can stimulate economic development in the decade to come.
Surging urbanization, if possible, would allow China to keep GDP growth at above 8 percent before 2015, according to a report released by China Investment Securities, a Shenzhen-headquartered company.
Policy and the future
What confronts China is a tricky balance between speed and quality. Statistically, China’s urban areas have expanded fast. But the quality of that expansion, given Xu’s story and others like hers, is questionable.
Hu Cunzhi, Vice Minister of Land and Resources, pointed out earlier that from 1990 to 2000, land urbanization was 1.71 times faster than population urbanization. The trend went further this past decade: city areas expanded by 83 percent while urban populations expanded only 45 percent.
But population flow has to match the allocation of resources. At the 2012 China Urban Development Forum held in August, many experts agreed that the government interference needed to be reduced in order for population to flow naturally according to the demands of the market.
“Too much policy control oppressed the progress of urbanization,” says Zhou Qiren at the seminar. Zhou is affiliated with the National School of Development at Peking University. “The household registration system and land system have impeded China’s urbanization.”
According to CASS’ blue book, nearly 500 million farmers will migrate to cities in the next 20 years. To accommodate this influx, at least 40 trillion yuan ($6.35 trillion) will be needed to cover the cost of social welfare and public infrastructure development. On average, 2 trillion yuan ($317.46 billion) will be needed for each year. This amount represents 20 percent of the Chinese Government’s annual revenue, according to 2011 data.
“To solve the problem, a mechanism should be established to share the costs among Central Government, local governments, enterprises and migrant workers,” says Song Xiaowu, President of China Society of economic Reform, in an interview with People’s Daily.
Xu works as a waitress at a small restaurant in the western part of Beijing. She is in her 20s, and moved to the capital from a village in Gansu Province.
In August, China announced that the country’s urban population had officially surpassed 50 percent. But Xu can’t say on which side of the 50-percent divide she stands. Leaving her rural hometown for years, Xu still feels like an “outsider” in the city of Beijing.
Global expectations of China are climbing; but the country is now facing a new, major domestic challenge: the further urbanization of the country, and more importantly, of its 230 million migrant population.
Urban explosion
On August 14, the Chinese Academy of Social Sciences (CASS) released The Urban Blue Book: China City Development Report No. 5. The report cites that urban dwellers now make up 51.27 percent of China’s total population – a significant change in the country’s social structure.
Xu and other new urban denizens like her, account for the increase but still can’t see themselves as “urbanites.”
“I don’t have a Beijing hukou,” she explains. “I will never be a Beijing resident.” her family’s hukou booklet says what she is: a member of the “rural population of Gansu Province.”
The hukou system, a household registration system unique to China, attaches a person to a particular place. People are registered in two categories: agricultural and non-agricultural. People with a non-agricultural hukou are far more likely to receive pensions, basic health care, and unemployment insurance under the social security system of the city.
Herein lies the biggest problem facing migrant population from rural areas. Simply moving to a city will not give them access to the social services available to someone with non-agricultural hukou.
Statistics show that endowment insurance, medical insurance and unemployment insurance in China are only accessible to 18.2 percent, 29.8 percent and 11.3 percent of all migrant workers across China, respectively.
Xu is in a relationship with a young man. he is from another village and also came to Beijing to seek work, but she’s not confident about their future as a couple in Beijing since life will get tougher with every future milestone. housing, medical bills, and education costs for children are all tied to hukou status. “In a few years, I might have to go back to my hometown to marry someone else,” Xu says.
Beginning in the 1990s, China’s farmers flooded into cities to meet the increasing demands of the country’s industrialization boom. But even though their role in urban development has been crucial, migrant workers still feel there is a glass wall separating them from their city resident neighbors. Many migrants keep their land, believing that they will ultimately have to return to their fields. The land can remain idle for years, which in turn may affect national food supply.
“If the over 200 million migrant workers who aren’t really urbanized are taken out of the equation, the real urbanization rate in China is only 36 percent,” says Yang Weimin, Deputy Director of the Office of the Central Leading Group on Financial and economic Affairs at an international seminar on housing policies on August 7.
Long Yongtu, former Vice Minister of Foreign Trade and economic Cooperation (now Ministry of Commerce), elaborates on this gulf. “The biggest problem of China’s urbanization,” he says in a forum held in late August in hebei Province, “is to find a way to turn migrant workers into real urban residents, providing them with equal access to social security, housing, medical care and public education.”
Long believes that urbanization has to be slowed down if necessary in order to solve these problems.
Surging ahead
Experts say that given China’s present economic state, a fast urban growth is in need.
China’s urbanization lags behind its booming industrialization. According to a report published by Reuters, the Chinese rate of urbanization compared to industrialization is 1.09 (51.3 percent versus 46.8 percent), while that same rate globally is 1.95(50.9 percent versus 26.1 percent).
China’s economy has grown at its slowest speed since the second half of 2009, with GDP growing 7.6 percent in the second quarter of 2012. Determined to reverse this slow domestic growth, China has shifted focus toward urbanization.
In July, Vice Premier Li Keqiang pointed out that urbanization is a major driving force for domestic demand and an important base for the adjustment of economic structures.
Some experts estimate that China’s rate of urbanization will further climb, nearing 60 percent by 2020. This is expected to bring investment and raise consumption, both of which can stimulate economic development in the decade to come.
Surging urbanization, if possible, would allow China to keep GDP growth at above 8 percent before 2015, according to a report released by China Investment Securities, a Shenzhen-headquartered company.
Policy and the future
What confronts China is a tricky balance between speed and quality. Statistically, China’s urban areas have expanded fast. But the quality of that expansion, given Xu’s story and others like hers, is questionable.
Hu Cunzhi, Vice Minister of Land and Resources, pointed out earlier that from 1990 to 2000, land urbanization was 1.71 times faster than population urbanization. The trend went further this past decade: city areas expanded by 83 percent while urban populations expanded only 45 percent.
But population flow has to match the allocation of resources. At the 2012 China Urban Development Forum held in August, many experts agreed that the government interference needed to be reduced in order for population to flow naturally according to the demands of the market.
“Too much policy control oppressed the progress of urbanization,” says Zhou Qiren at the seminar. Zhou is affiliated with the National School of Development at Peking University. “The household registration system and land system have impeded China’s urbanization.”
According to CASS’ blue book, nearly 500 million farmers will migrate to cities in the next 20 years. To accommodate this influx, at least 40 trillion yuan ($6.35 trillion) will be needed to cover the cost of social welfare and public infrastructure development. On average, 2 trillion yuan ($317.46 billion) will be needed for each year. This amount represents 20 percent of the Chinese Government’s annual revenue, according to 2011 data.
“To solve the problem, a mechanism should be established to share the costs among Central Government, local governments, enterprises and migrant workers,” says Song Xiaowu, President of China Society of economic Reform, in an interview with People’s Daily.