During the last four decades, China's regional development policy has twice been changed significantly. Beginning in 1953, the Chinese government sought to balance the distribution of industrial production by shifting the nation's industrial center inland from eastern China. To achieve this goal, the central government invested national funds in construction in the inland areas. This policy slowed development in eastern China, especially in many coastal cities, reducing the economic dominance of the region. This, in turn, affected the government's ability to support inland development. This 25-year policy sacrificed efficiency for regional equality and is regarded as a period of balanced regional development.
The second major change began in 1979, when the government sought to alter some of the ineffective policies of the past. Some of the policies it planned to change were total public ownership of industry, a completely planned economy, and the priority that had been given to heavy industry, reducing efficiency for the sake of regional equality. At that time, the government tried to turn the planned economy into a more market-based economy in order to improve resource allocation and optimize industrial structure. As a result, under the principle of giving efficiency priority over regional equality, the coastal area reemerged as the region of principal investment. This began a period of so-called imbalanced regional development policy.
Because these different regional development policies determined the orientation of investment in China, they resulted in different regional features. Therefore, these policies are key to understanding regional urbanization and industrialization in China over the past four decades.
Wang discussed data which, when aggregated with China's socioeconomic circumstances, reveal some of the major characteristics of urbanization in China. First, the urbanization process is accelerating along with vigorous industrial development. On the basis of adjusted data for the country as a whole, the percentage of Chinese population which is urbanized has risen steadily from the 1978 level of 18% to the 1993 level of 28%. From 1978 to 1993, the percentage of urban population increased by 10% in 15 years, compared to the 7% rise that took place over the previous 30 years (1949-78).
It is very difficult to truly determine urban population. While a figure of around 28% is often quoted, demographers believe it is already over 30%, and official estimates are that it will be close to 60% in the early part of the next century.
Secondly, the disparity of urbanization momentum between the coastal and inland regions is widening due to the new emphasis on efficiency rather than regional equality. (A number of factors are used to determine the mean efficiency of different provinces including secondary and tertiary industrial output value, power consumption, water consumption, profit margin, and tax rates.) Differences in geographical conditions are also partly responsible for the regional imbalance. Statistical information on the disparity in urbanization by province or region does not truly reflect how distinct these patterns are because the urban population registration system and related policies have not been fully reformed. In interpreting statistics, for example, it is important to understand what the definition of a city is. In China, there are a number of factors used in defining cities, including: 1) population over 100,000; 2) proportion of agricultural output to other out put; 70% must come from non-agricultural sources to be considered a city; 3) administratively, cities must be approved by state council for tax purposes.
Third, most of the non-agriculturally based population in relatively developed areas are asked to remain in local industries in order to lighten the burden on cities, especially in eastern China. A series of measures are in place to restrict migration from rural to urban areas. Though part of the rural population is no longer engaged in agricultural activities, they are not allowed to move freely to urban areas. Instead, they are employed in township enterprises which afford a lifestyle that is different from that of the peasants. This phenomenon is very prominent in the coastal area.
Fourth, the increase in regional urbanization disparities has led to large-scale temporary migration from inland to coastal areas. These temporary migrants leave their native regions and move to cities to seek jobs without the government's permission. They are not counted as urban inhabitants by the population registry, even though many have lived in certain cities for an extended period of time. In recent years, this type of migration has increased dramatically. Based on a survey in Shanghai in 1988, there were 817,000 temporary migrants in the Shanghai city limits. According to a survey in Beijing this year, some 2,877,000 people are living in the city "temporarily." These people are not recognized as migrants, but are instead regarded as "mobile or floating population."
Today, there are three serious problems for the Chinese government:
It must continue to develop township-owned, village-owned and private enterprises, in order to keep more of the labor force in the rural areas and avoid over-urbanization of the population. These rurally-based enterprises must be appropriately concentrated in small towns to raise production efficiency, economize on the use of cultivated land, reduce waste of resources, and limit the scope of environmental pollution.
It must protect the basic cultivated land area from urbanization pressures and work toward sustainable agricultural practices.