China’s Mega-Urbanization Woes
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By Yongnian Zheng

China’s Mega-Urbanization Woes

Apr. 12, 2017  |     |  0 comments

Over the last three decades, China has reaped tremendous gains in its urbanization program. Its urbanization rate has jumped from 38 percent during the late 1970s to the current 56 percent. If measured against the Organization for Economic Co-operation and Development’s standard of 70 percent, China is only 14 percent away from becoming a highly-urbanized country.

In other words, China has achieved urbanization in about 30 years, a process that took the West more than a century. However, if we look closely, the journey has been perilous and quality has suffered due to the fast speed; not to mention there are many uncertainties that abound in the urban landscape of China.

During the 18th National Congress of the Communist Party of China in 2012, urbanization was defined as one of the pillars for China’s sustainable economic development. There was a flurry of policy proposals, and great hopes were pinned on the stimulus effects of urbanization on economic development. As time passed, however, urbanization seems to have disappeared from the government’s agenda, and the momentum has dissipated. What happened?

Urbanization on the Wane

To answer the question, we need to look at the philosophy behind the original proposal for China’s urbanization, and the kinds of results it produced.

First, the driving force behind China’s initial urbanization was GDPism, which is purely about economic growth. Investment, trade, and consumption were for a long time the engines of growth for China’s economy. Urbanization had not only created a huge investment space, it also lifted consumption and trade. Under the guise of GDPism, urbanization in the eyes of government officials simply meant building houses and cities. Furthermore, as property was the main income source for local governments, officials launched so many housing projects that “ghost towns” void of occupants began sprouting up across the country. Over-capacity in the property sector remains a big problem even today.

Second, in the rush for urbanization, safety issues were frequently overlooked. Cities might have become bigger in size, but there are also more dangers lurking around. Recent incidents include the Tianjin explosions and the Shenzhen landslide in 2015. China also suffers from monsoon flooding, defective buildings, and smog.

Third, reform of the household registration (hukou) system did not match the speed of urbanization. The consequence is the ruralization of urban areas. Of the 56 percent urban population, only 40 percent have urban residence permits. In other words, there are over 10 percent of people in the cities who are rural workers or farmers. They have lived and worked in the cities for a long period of time and their offspring have already grown up, yet they are not integrated into the cities. Almost all the major cities in China have “villages in the city” and rural workers.

These “villages in the city” are born from the rapid expansion of urban areas, where old villages are enveloped by skyscrapers all around. There have been efforts to improve the living conditions of these villages, but there remain serious concerns about employment, livelihood, and safety.

Infrastructure is built and then torn down, and the cycle keeps repeating itself. GDP might have risen but the city is crumbling.

Fourth, urban planning is entirely in the hands of the city mayor. Although there is urban planning in the major cities of China, in actuality, these plans are never followed through. Bureaucracy is the culprit as every mayor has his own set of plans. There is no continuity in the urban planning of the outgoing and incoming mayors, as the new officials will amend or overwrite the previous officials’ plans. Even more harmful is that every mayor’s goal is GDP growth and not for the sake of urbanization.

The fallout is that infrastructure is built and then torn down, and the cycle keeps repeating itself. GDP might have risen but the city is crumbling. Then there is the problem of corruption, as mayors have found that they can obtain monetary gains from the cycles of municipal works.

Fifth, red tape and bureaucracy are driving professionals away. China’s cities are categorized under different administrative levels—capital city, municipal city, provincial city, sub-provincial city, prefecture-level city, county-level city, villages and townships, etc. In addition, every city has multiple levels of government. Many of the organizations in the city, such as schools, hospitals, and state-owned enterprises, have their own administrative levels too. This highly bureaucratic environment does not give full play to the urban planner’s professional knowledge, and he also has to fight against the mayor’s own vision of urban planning. The hardware (buildings and infrastructure) in some Chinese cities might be impressive, but the software (urban management) lags far behind, mostly due to the dearth of urban planning professionals.

Besides the above issues, there are other phenomena and policies which have become roadblocks in China’s urbanization journey.

Mega-urbanization Woes

One of the major problems is the mega-urbanization of Chinese cities. There are two trends, one being a single city becoming overwhelming large, the other being the forming of megalopolises. China’s first-tier cities, such as Beijing, Shanghai, Guangzhou, and Shenzhen, have populations of over 20 million each, and they are still expanding. If there are no reforms done, these cities will get bigger and bigger until a crisis erupts.

While these mega-cities are a result of a lack of control, the megalopolises have been purposefully created by the relevant departments. Ten of these already exist, such as the Beijing-Tianjin-Hebei integration, the Yangtze River Delta region, the Pearl River Delta region, etc. These behemoths are viewed as the model for China’s urbanization.

Let’s look at the positive impacts of mega-urbanization. From an economic point of view, there will be GPD growth as trade volume will increase in tandem with the size of the city. In terms of engineering, connectivity within the city and between cities creates technical expertise.

However, the negative impact is that socio-political and environmental issues have been neglected. If we continue to disregard them, they may snowball into future catastrophes.

First, the best resources are concentrated in the mega-cities, disrupting the balance and sustainable development of the national and regional economy. This problem already existed before China embarked on its reform and opening up. Over the years, it was hoped that by expanding internal demand, the economy would become sustainable. However, as quality resources converged in a few big cities, internal demand was not evenly spread out.

Second, if the urban structure does not change, it will be difficult to push through social reforms. Bottlenecks have appeared in the reforms of the healthcare, education, public housing, and other sectors, because the restructuring has overly focused on the micro-level and has overlooked the structural issue. For example, if only the best hospitals and schools (from pre-schools to universities) can be found in Beijing, then we cannot stop people from swarming into the capital city, and it will be equally difficult to ask people to leave. This situation will change once there is an even distribution of resources.

Third, mega-urbanization has produced negative socio-political effects. Some mega-cities have become increasingly richer while more and more cities have become poorer. If we continue to sideline the welfare of the medium and small cities, they will inadvertently become the hotbeds of Chinese populism.

Further, there is a deep sense of distrust towards the ruling party and government. Society’s trust in the government is based on the public services that the government is able to provide. If the size of the city is too large, it will be difficult for the government to provide effective public services. In recent years, there have been numerous protests against the building of paraxylene chemical factories and waste disposal plants. However, the sad fact is that many big cities in Chinese are so inundated by garbage and filth that it has reached a rampant level. The distrust of the people against the government has made it impossible for the authorities to work effectively.

Fourth, a graver issue is the security burden caused by mega cities. Modern warfare has made it very easy to destroy any city. It is worthy to note that during the Mao Zedong era, industrial capability was spread all over the country, especially the hinterland. Mao’s philosophy was to be prepared for war, and have every unit in the country to be self-reliant. If Washington DC, New York, and Los Angeles are devastated by bombs, the US may still function. If Beijing, Shanghai, and Shenzhen face the same fate, the whole of China will crumble. It is the same for Tokyo or Seoul. This is the disadvantage of concentrating resources in mega cities.

(Translated by Chean Chian Cheong)

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