land reform: the first SZ paper of 2013

In its first document 2013 (2013年一号文件) Shenzhen announced that its intention to finish expropriating collective lands in order to transfer land use rights for high-end development to state owned real estate developers, like China Resources and Jingji. In official parlance its know as  land reform (土改), and yes, I’m starting to think I live in a post-ironic city.

The problem of Shenzhen urban villages is, of course, that they were not villages. Under Mao, they were incorporated into the state apparatus through collectivization. Villages became teams, several teams became a brigade, and groups of brigades constituted a commune. In turn, the communes were the basic administrative unit of Bao’an County, Shenzhen’s territorial predecessor. In short, the collectives had a modern bureaucracy, and did agrarian work in not quite primitive, but very rough conditions.

In 1978, led by liberalization in rural Anhui, teams and brigades throughout China began to dismantle, and Bao’an was no exception. Redeploying the administrative structure of the Maoist state, they created “new villages”, which continued to do agrarian work, but for collective profits. Traditional village relationships and historic identities facilitated this process. In Bao’an, however, the establishment of the Shenzhen SEZ meant that collectives could also invest in manufacturing and real estate development.

In 1992, Shenzhen incorporated the inner villages into the municipal apparatus and in 2004 the outer villages were incorporated. So technically, the villages, which had not been villages, were now urban neighborhoods. Except, they were also limited holding companies. And there’s the legal rub: Shenzhen urban villages were limited holding companies which owned investments that had been legally built on collective land, but now occupied state-owned land, creating a messy, grey area of compensation demands and property rights.  According to Shenzhen Urban Planning Chief, Wang Youpeng (王幼鹏),

The government cannot take [the land] back, and the collectives can’t use it (政府拿不回,集体用不了).

The Municipality’s convoluted description of the villages reflects this complicated history. In the first document of 2013, the villages are called “Former Rural Village Economic Organization Work Unit (原农村集体经济组织单位)” — hee! But here’s the not-so-funny point: The 2013 paper legalizes the direct transfer of collective lands to real estate companies. Previously, the villages negotiated with the Municipality, which in turn accepted bids from real estate companies. Now, the Municipality has stepped back from this role. Instead, the villages may negotiate directly with the companies.

In terms of asset transfer, it means that villages must remove their technically illegal buildings from municipal lands. Their are two compensation packages. Either, villages sell their buildings, giving half the price of the sale to the Municipal government, or the villages sell their buildings and give 70% of the price to the Municipal government, but receive up to 20% of whatever is subsequently built on the land.

Xi Jinping has come and gone. The Shenzhen People’s Congress has met and disbanded. Exhortations to study the Spirit of the 2013 18th National People’s Congress have proliferated throughout Shenzhen. And now we know what it means – there is a new means of legalizing the transfer of property and resources from the urban villages to Shenzhen Municipality, further concentrating property and resources in the hands of whoever happens to be in charge of negotiating this process on behalf of the People Party.

That said, after a surge in the stock market, the general response has been one of confusion. It seems the paper is unclear on how the process will actually take place.

12 thoughts on “land reform: the first SZ paper of 2013

  1. Mary:
    “深圳原农村集体经济组织继受单位合法工业用地,可申请进入市场流通”, so, it applied to “land for public development” which is now managed by village-converted Ltds? right? not applicable to homesteads?

    • The question of 宅基地 is interesting. This evening I asked architecture friends. They understand the new paper to be a first step toward legalizing village corporation holdings. So that its not (at the moment) a question of selling homesteads, but rather the government getting money to legalize factory buildings, then either the village corporations or another company can develop the land. However, once the precedent is set, then the next target could be homesteads because as written, not just buildings can be sold, but also the rights to individual floors within a building. The people I talked with tonight think its a good thing.

      • ah, too bad.
        yes, there are academic papers recently argue that villagers simply enjoy windfall and become a new “rentier class”. I kind of disagree the blame put on villagers but this may offer another example to see how “property ownership” (which is the core of neoliebral discourse) can reshape social relations (if not class relations) instantly and drastically. comparing immigrant workers who also have collect land at home and the villagers in shenzhen urban villages, both of them were farmers but run into completely different paths. so the fundamental driver is commodification of land, whereas hukou is only mediator. rural hukou may privilege somebody whilst discriminate others.

      • Well, yes many villagers are enjoying the windfall. Many others have yet to truly participate and want in. The point, as you note, however, is that Shenzhen’s property relations are complex and shifting as village corporations’ relationship with the government continues to change. Within this shifty shifting landscape, migrant workers and recent college graduates and lower income families need access to the relatively inexpensive rentals in the villages. As for hukou, Shenzhen villagers are urban residents. Guannei villagers have had urban hukou since 1992 — 20 years already. Guanwai villagers have had non-rural hukou since 2004. All this to say that part of the controversy over villager landholdings is that technically they’re not villagers. Instead, they urban residents who have land.

  2. So, all the urban villagers in Shenzhen have had urban hukou already? Then, the land they are holding should not be considered as collective farmland either farmers’ 宅基地? I am totally lost about this.

    • Hi Sean, there are no villages in Shenzhen. Technically, all the land in Shenzhen is part of the urban apparatus and the former villages are administratively called communities (社区) Consequently, all former Bao’an villagers — the original villagers before Bao’an County (宝安县)was elevated to Shenzhen Municipality (深圳市)– have Shenzhen hukou. In 1992, the villages in the inner districts were integrated into the state apparatus. In 2004, villages in the outer districts were integrated. So, the villages do not own their ancestral lands. However, they do own the buildings on the lands. All of the negotiating is about the buildings because once the buildings go down, the villagers have no more claim on the land. With respect to the buildings, there are collective (集体) and individual (宅基地上的房子)holdings. The status of the migrants who live in the “villages” is less complicated. They either have long-term residency permits or they do not, but their hukou is in their hometowns.

      • Thanks so much, Mary.You are so resourceful and helpful and hope to see you there during my upcoming visit to Shenzhen in March and April with my fellow students from university of Amsterdam. Thanks again.

  3. This is very clear explanation. I like to add one more observation here, staffs in the community working stations were members of previous village committees before the conversion. So basically it is still the same team who manages the properties in the village. here is the interesting thing I’m trying to figure out. Most team members are cadres therefore supposed to be directed by the local government, they are party members as well, so supposed to be supervised by the party committee at the street office level. so technically, they are supposed to be those who implement decisions made by the local state. meanwhile, they are managers of properties and their income are largely from the rent. this puts them on the oposite side of the local state. how do you think?

    • Hi juneandjune,
      Yes, still the same team managing enterprises, although many of the first generation have already retired and their sons or sometimes daughters are running the collective holdings. However, if we go back to the Mao era, again, we must deal with the fact that these were not villages — they were rural work units, or “brigades (大队)”. In fact, with the establishment of collective holdings, especially communes, what we see is that in China we have modern administration (centralized bureaucracy) managing low-tech rural production.The key question, of course, is one of social legitimacy. Who has the right to own / manage/ profit from this land and the holdings on the land and how is that right justified?

      • Hi Mary:

        So we are back to the question of “man who dug the ditch? ” I just read Harvey’s paper on Hegel, Von Thunen, and Marx, although that paper is more on spatial fix and global division of labor. but there is discussion on labor and the two values. I dont think I have a clear idea of it though. Correct me if i am wrong, does it give the state, the one which truly represents the common good, the right to own the land, if no property ownership to be introduced?
        also the spatial fix theory makes me think that, there is either an international communists society, or none; because no enclave of communists country/region can survive on its own in the globalizing world?
        another question is: do you mean that, rural areas in China has been managed by the rural work units since Mao? therefore, there is no such thing of extending governance through converting rural land to urban land, as argued by Hsing (if i understood her book correctly)? I must be wrong here.

      • Hi Salie,

        I don’t understand the reference to “man who dug the ditch”.

        About Chinese property law — tricky tricky tricky because government always seems to be “land reform”. Under Mao there were two systems; socialist in the cities and collective in the countryside. Urban residents received housing, education, medical care and food rations, but no rights to land; in contrast, collectives were built on the basis of traditional villages, so that the land that belonged to a collective more or less corresponded to traditional land rights. A commune was a larger administrative apparatus that integrated rural production among neighboring villages brigades. In Shenzhen, for example, many of the current subdistricts are actually names of former communes — Nantou and Xixiang come to mind, for example.

        Importantly, in terms of the Chinese state apparatus, instead of housing, rural residents received the right to build a house on collective land, they received rudimentary education but had to go to a market town or city for high school, were visited by barefoot doctors, and sometimes were given / appropriated the right to grow vegetables and raise chickens. With the household responsibility system (家庭联产承包责任制), rural residents were allowed to use collective / traditional lands for cash crops provided they had met their obligations to provide the state with X amount of quota rice. Over time, the quota rice requirement transformed, but through the household responsibility system and remnants of the socialist rural housing policy, various villages and individual villagers occupied traditional land. Moreover, as collectives villages also had rights to use land for collective livelihoods, including building factories.

        All this happened first in Shenzhen, where collectives legally occupied land that was subsequently integrated into the municipal apparatus. And there in lies the legal conundrum. As part of the settlement for becoming part of the municipality village corporations and members were given money and land to use for collective livelihood and family housing. They no longer owned the land, but they had been given the opportunity to build. In the inner districts, these boundaries were drawn in 1992, but not really finalized until 1996, when the new urban plan came out. And even then, villages and villagers were still building. In the outer districts they were building until 2004 and still are in some places, although its become more difficult. Now how much housing was legally built and how much opportunistically built? There’s an interesting question because it varies from village corporation to corporation.

      • Hi Mary:

        many thanks for the detailed explanation. I have been crazily busy these days, hope to discuss this with you later.
        Happy Chinese New year of Snake!

        The one with the ditch and ownership thing is words by a very famous philosopher, but i forgot his name. the point is that, man who dig the ditch has the right to claim the ownership. A while ago, I read some special issues on ownership of nature on Antipode, they trace back to Karl Marx and John Locke on privatization of nature (land).

        Mansfield, Becky. “Privatization: Property and the Remaking of Nature–Society Relations Introduction to the Special Issue.” Antipode 39, no. 3 (2007): 393-405.

        have to leave, hope to talk to you later.

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