How can the reform of the property rights system for rural resource-based assets be accelerated?

On September 29, 2014, the fifth meeting of the Central Leading Group for Comprehensively Deepening Reform deliberated and approved the "Pilot Program for Actively Developing Farmers' Share Cooperation and Empowering Collective Asset Shares with Property Rights," and the reform pilot will take into account the different regions of the east, central and west. It is very necessary to select different regions for pilots. According to national agricultural economics statistics, the regional differences in rural collective assets are enormous: the eastern region holds 76% of the assets, while the western region accounts for only 7% of total assets. The author believes that in rural areas with developed industrial economies and relatively high commercial property income, where a large number of disputes are involved, the property rights reform of operating assets is urgent. However, in agricultural-type villages with underdeveloped industrial economies, no other source of income, but possessing large amounts of land, mountain forests and other resource-based assets, carrying out the reform of the rural collective property rights system is even more fundamental.

First, the protection of property rights and the realization of rights and powers over resource-based assets are the core part of the modern rural property rights system. Establishing a sound property rights protection system is an important foundation for the normal operation of the market economy. In agricultural-type areas, resources such as cultivated land and mountain forests are the lifeblood on which farmers depend for their livelihood. Rural collective land rights are the greatest property rights of farmers. At present, the rights and powers to dispose of the income from rural land property are deficient, the subject of collective land ownership is nominalized, farmers' land ownership boundaries are unclear and protection is not strict, the usufructuary rights of farmers' contracted land, homestead land and houses are not fully realized, and the free flow and optimal allocation of resources are seriously hindered. Capitalizing the assets on the books into shares is merely a matter of technical operation, whereas the above-mentioned property rights issues are the deep-seated, fundamental issues concerning the rural market economy. Compared with economically developed areas, these are precisely the prominent problems faced by agricultural-type areas.

Second, among the series of reforms to deepen the rural areas deployed by the central government, the protection of rights and activation of rights and powers over land and other resource-based assets bear on the overall situation. In brief, the goal and task of what all sectors of society call the pilot reform of rural collective property rights is to "empower rights, clarify property rights, improve rights and powers, and activate all types of factors of production." Among these, land and other resource-based assets are undoubtedly the most directly in need of clarified property rights and improved income and disposal rights and powers, and are also the factors of production most in need of activation in developing the rural market economy. In fact, in the central government's deployment, reform surrounding land and other resource-based assets has always been the highlight of the collective property rights system and bears on the overall reform of rural areas. On December 2, 2014, the seventh meeting of the Central Leading Group for Comprehensively Deepening Reform deliberated the "Opinions on the Pilot Work for Rural Land Expropriation, Market Entry of Collective Operating Construction Land, and Reform of the Homestead System," and major reforms of construction land and homestead land are about to be launched.

Third, many resource-based assets are also the source of operating assets, and operating assets and non-operating assets cannot be fully separated. According to incomplete statistics from the Ministry of Agriculture, as of the end of 2013, the total book assets under unified operation by collective economic organizations nationwide reached 2.4 trillion yuan. A large part of these assets is attached to land owned by farmers' collectives, or is derived from land owned by farmers' collectives. Therefore, even in areas with large book net assets and developed economies, operating assets, non-operating assets and resource-based assets should all be included in the scope of capitalization. Only in this way can the integrity of rural collective assets be ensured, can the reform be thorough, and can all rural collective assets be revitalized so that they deliver greater value and better realize and protect farmers' property rights and interests.

Fourth, although the disputes and conflicts over resource-based assets are chronic and inconspicuous, they are also cumulative and most relevant to rural social stability. Land is the carrier of rural social management, yet land and other resource-based assets are often difficult to resolve because they involve complex historical issues and property rights relationships. If they are abandoned and left unmanaged in the property rights system reform, or only the parts that can be converted into monetary income are handled, these conflicts will continue to accumulate, and the accumulated conflicts may be difficult to govern once they erupt. The property rights reform of land resource-based assets bears on the long-term stability and peace of rural areas.