From Observer, page 39, issue no. 387-388, September 29 - October 6, 2008
Translated by Ren Yujie
Original article: [Chinese]
(The writer, Zhang Shuguang, is the president of China's Unirule Institute of Economics.The article below is his reflection on the makeover plan for urban villages in Shenzhen after a field study visit there.)
The term "urban village" has often appeared in the media, especially in the newspapers of Shenzhen and Guangzhou (coastal cities in southern China where migrant population congregate). In recent years, a "makeover" for these urban villages has become urgent task for local authorities.
What exactly are urban villages? Why do they need a face lift? How to remake them? for people who have never been to these places, they may form a very different impression based on developmental propaganda.
Urban villages are massive communities residing within a city. Instead of shabby mud and straw houses imagined by many, these villages are usually filled with blocks of multi-storey buildings above seven floors and high in density.
Block after block of buildings standing close to each other, the ground floors are always shop lots, selling all kinds of merchandises and services; the floors above are basically occupied by villagers and migrant workers. These communities are bustling with activities all day long, even at nights.
In Shenzhen, there are some five million people living in 320 urban villages, covering areas of 93.49 million square meters in size. According to some friends who had visited Vietnam recently, these urban villages appeared to be more prosperous, lively, and developed than some big cities there.
However, local authorities are adamant in ridding these urban villages. Villagers and local authorities have been engulfed in a prolonged tug-of-war over the future development of urban villages, the counter offers also evolved over time.
After China initiated reform and opening up policy thirty years ago, large number of rural migrant workers flooded major Chinese cities in search of jobs in various industry parks, many of those were set up by foreign investors.
The existing villagers in the urban villages too sensed the economic opportunities, they started utilising their house-site land to build factory plants and workers' dormitories for profits; in the process, these urban villages contributed to the economic development of the cities they belonged to. The development of urban villages climax in 1993 between 1999, as low rise buildings were being replaced by higher blocks as population density increased.
By 2004, the local government of Shenzhen framed regulations to reconstruct and reform urban villages, the implementation phase that followed saw a few of such villages being demolished, but the move met with strong local resistance and proved to be too costly, the "makeover" plan soon sank into a deadlock.
By the time this writer visited a few urban villages recently during a field trip study, these villages were still expanding and building at frantic pace, and some of the construction works were actually approved by local authorities.
Apparently, the "makeover" of urban villages should be in accordance with local urban planning, but each municipal government has its own set of requirement and wills in planning, thus, how systematic or scientific such urban planning would be is questionable.
To some degree, urban planning is also a tool and means for local authorities to commercializing resources, possessing land and pursuing profits.
Behind the revision of urban planning and "makeover" of urban villages, what people often noted is government officials' ambition for great achievements.
To realise the goal of building a modern and international metropolis, city beautification is necessary, and the slump-like urban villages are an eyesore. Therefore, eliminating urban villages is also a project to defence the reputation and "face" of local officials. Besides, the "makeover" is also driven by profits.
The term urban village is self-explanatory, referring to village located in the heart of a city. As land prices in the cities soaring, many property developers have been eyeing the villages in strategic locations with keen interest.
Moreover, among the10 million over migrant workers in Shenzhen, nearly half of them reside in urban villages. Thus, a makeover of these villages would mean having to build new houses to accommodate some five million people.
If based on a conservative estimation of each resident needs 20 square meters for housing, and each square meter would cost 10,000 yuan, the potential business for developers would run into trillion of yuan. As leading developers usually have close ties with local officials, both are motivated to promote a makeover for urban villages for joint benefits.
However, have the local government and officials considered the following issues thoroughly before jumping on the makeover bandwagon?
First of all, the pros and cons of having urban villages and their implications on cities' development.
For instance, what supported the development of Shenzhen? Though the factors are multiple, one of the major driving forces is human resource -- the millions of rural migrant workers from across the country, and many of whom residing in urban villages.
The cost of living in urban villages is relatively cheaper - from house rental, food, to goods and services -and that provides comfortable space for survival for rural migrant workers, and that also helps to keep the cost of production low for enterprises looking for competitive edge.
If the urban villages were all removed, how many migrant workers could afford to stay in newly constructed residential units? How the changing living condition would affect the cost of production for their employers? Could Shenzhen maintain its pace of development?
Another point for contemplation - what kind of developmental model does Chinese cities wish to adopt?
Up til now, many Chinese cities have developed in an expansionism mode, causing wastage of land resources, leading to large area of farming land being occupied and converted. In recent years, farming land has been disappearing at a rate of over 10 million mu ( hectare) per year.
By 2006, the per capita land-use area for urban Chinese residents stood at 133 square meters, some 50 square meters more than that of developed European nations, though the latter are ahead in urbanization. In urban villages, however, the per capita land-use is less than one square meter.
That brings us to another problem - solving urban housing. One major public policy is that the government should invest in low-cost housing to guarantee the sheltering of low-income groups.
Over the years, urban villages have become synonymous with low-cost living. In other words, these villages have created an alternative to solving housing problem for low-income groups, and partially relieving the government from its responsibility.
The demolition of urban villages must be compensated with guaranteed low-cost housing and relocation fees. Is the Shenzhen local government prepared to fork out hundreds of billions of yuan in delivering such amenities? Can the local authorities afford it?
Urban villages are built upon the sweat and hard work of locals, even though the land belong to the government, the buildings are private assets, which can only be leveled upon the approval of their owners. Though the government has the right to acquire the land for public need and redevelopment, that should come with corresponding compensation.
If villagers concern disagreed with the compensation offered, and the local authorities proceeded with demolition, such move could be deemed as a violation of private assets.
In China, I believe there existed two versions of urbanization process. One according to the whims and wills of local officials, who cooperate with property developers in acquiring and selling land, and excluded farmers from the urbanization and industrialization process.
The other is a people-oriented urbanization, allowing rural collective-owned land be transferable and traded in the market, thus achieving fair prices. The development of urban villages is also an urbanization process, and fully participated by the locals, and could serve as a reference for emerging cities. Why should we allow the official-led urbanization, and prohibit the people-led ones?
Local authorities have put forward various reasons on the need to remake urban villages. For instance, concern over fire incident and fire fighting in such high density areas; the poor sanitation; and crime management. In my view, instead of prompting the move of demolition, these problems should have driven local officials to look for better ways to improve city management.
In line with building a harmonious society and implementing humane administration, local officials should spend more time on thinking thoroughly over how to resolve problems, and that would become a yardstick in measuring the local authorities' management capacity.