2015 Central Document No. 1 focuses on food security and farmland reform
On February 1, the full text of the 2015 Central “No. 1 Document” was officially released.
This document, titled "Several Opinions of the Central Committee of the Communist Party of China and the State Council on Increasing the Intensity of Reform and Innovation and Accelerating the Construction of Agricultural Modernization," was reviewed and approved at the Central Rural Work Conference held on December 22 and 23, 2014, and was subsequently issued internally to departments at all levels and agriculture-related units.
Zhang Xiaoshan, a member of the Agriculture and Rural Affairs Committee of the National People's Congress and former director of the Rural Development Institute of the Chinese Academy of Social Sciences, told a reporter from 21st Century Business Herald that the 2015 “No. 1 Document” addresses many issues, from agricultural modernization to rural governance, covering almost every field related to agriculture, rural areas, and farmers, but some core keywords can still be found within it, and these keywords will be given priority for resolution in 2015 and in the years to come. These keywords include food security, farmland reform, and agricultural product price reform.
Safeguarding Food Security
Although China has achieved an “eleventh consecutive increase” in grain output, food security remains a sword hanging over the government's head. This issue has received unprecedented attention; at the 2013 Central Economic Work Conference, food security was discussed as a major topic, highlighting its importance.
In the general statement of the 2015 “No. 1 Document,” concerns about agriculture and food security are evident in the following words: “The cost of domestic agricultural production is rising rapidly, the prices of bulk agricultural products are generally higher than those on the international market, China's agricultural resources are scarce, development has been excessive, and pollution has worsened. How to ensure the effective supply of agricultural products and quality safety under the hard constraints of resources and the environment, and how to enhance the capacity for sustainable agricultural development, is a major challenge that must be addressed.”
A person from the Rural Economy Department of the Development Research Center of the State Council told a reporter from 21st Century Business Herald that the theme of the 2015 No. 1 Document is agricultural modernization and reform and innovation in agriculture, rural areas, and farmers, and one of the ultimate goals of both is to achieve national food security. An important indicator of food security is that grain output can achieve basic self-sufficiency, and this mainly relies on three means: first, farmland does not decrease, which requires strict protection of cultivated land; second, the utilization rate of cultivated land does not decline, which requires protecting farmers' enthusiasm for growing grain and innovating agricultural operation methods so that land is transferred to entities more willing to farm and better able to farm well; third, increasing per-unit yield, which requires scientific and technological innovation. In summary, achieving food security requires efforts in three aspects: land, people, and science and technology.
The person said that the government has already begun work on strengthening cultivated land protection, and this task has been assigned to relevant departments and implemented as a principle and important precondition in other aspects of work related to agriculture, rural areas, and farmers.
The “further improvement and implementation of the provincial governor responsibility system for grain” proposed in the “No. 1 Document” has already been issued to various localities as a separate document. The first point proposed in these opinions is to “resolutely hold the red line of cultivated land. Implement the strictest cultivated land protection system to ensure that the existing cultivated land area remains basically stable and soil quality does not decline.”
Prior to this, relevant departments had already begun deploying cultivated land protection work.
On January 5, 2015, the Ministry of Land and Resources and the Ministry of Agriculture jointly held a video conference in Beijing to deploy work on delimiting permanent basic farmland and standardizing the management of facility agricultural land. Premier Li Keqiang, Vice Premier Zhang Gaoli, and Vice Premier Wang Yang gave important instructions on the work deployment. The meeting pointed out that illegal and irregular land use under the pretext of developing agricultural facilities must be seriously investigated and dealt with, with key accountability, to ensure that the policy provisions are implemented: “land use must not be changed, and unauthorized use for other non-agricultural construction is prohibited; land use must not exceed standards, and unauthorized expansion of land use scale is prohibited; the nature of agricultural facilities must not be changed, and unauthorized use of agricultural facilities for other operations is prohibited.”
As early as early November 2014, the Ministry of Land and Resources and the Ministry of Agriculture jointly issued the "Notice on Further Improving the Delimitation of Permanent Basic Farmland," requiring that the delimitation of permanent basic farmland around 14 cities including Beijing be carried out first, and that the nationwide delimitation of permanent basic farmland and the improvement of results be fully completed by the end of 2016.
Implementing Farmland Reform by Category
The principle of cultivated land protection has also extended into farmland reform.
In the 2015 “No. 1 Document,” it was reiterated that “on the premise of ensuring that the nature of public ownership of land does not change, the red line of cultivated land is not breached, and the interests of farmers are not harmed,” on this basis, “prudently and steadily advance the reform of the rural land system.”
The “No. 1 Document” states that pilot reforms of rural land expropriation, market entry of collectively operated construction land, and the homestead system must be implemented by category. Measures must be formulated to narrow the scope of land expropriation. A mechanism for distributing land value-added benefits that takes into account the state, the collective, and individuals must be established, and individual benefits must be reasonably increased. The reasonable, standardized, and diversified safeguard mechanism for farmers whose land is expropriated must be improved. Rural collectively operated construction land that complies with planning and use control must be granted the functions of transfer, lease, and equity participation, and market transaction rules and service supervision mechanisms must be established and improved. Farmers' homestead rights and interests must be safeguarded in accordance with the law, the method for obtaining residential land for farmers must be reformed, and new mechanisms for farmers' housing security must be explored. Guidance and supervision of pilot work must be strengthened, ensuring closed operation and controllable risks, summarizing and improving while piloting, and forming reform results that can be replicated and promoted.
Han Jun, deputy director of the Office of the Central Leading Group for Financial and Economic Affairs, said recently at the “Sixth China Economic Prospects Forum” that relevant departments, in accordance with the reform plan and deployment, are now formulating policy documents related to land system reform: one is a national guiding opinion on rural land contractual management rights and registration and certification, one is a policy guidance document on pilot mortgage loans for rural contracted land management rights and farmers' housing property rights, and another is a policy guidance document on implementing the long-term stability of land contracting relations. Han Jun said these three guidance documents are expected to be officially issued in 2015.
Li Guoxiang, a researcher at the Rural Development Institute of the Chinese Academy of Social Sciences, said that this year's situation for agricultural product price reform is unprecedentedly severe, mainly because international oil prices and bulk commodity prices have shrunk significantly, which has made the inversion of domestic and international agricultural product prices more serious. The Chinese government's measures to maintain domestic agricultural product prices through price subsidies will face a greater fiscal burden.
In response, the 2015 “No. 1 Document” proposed summarizing the pilot experience of target price reform for cotton in Xinjiang and soybeans in Northeast China and Inner Mongolia, improving subsidy methods, reducing operational costs, and ensuring that subsidy funds are promptly and fully delivered to farmers. The national grain reserve throughput adjustment mechanism must be improved, and supervision of reserve grain must be strengthened. The plan for newly added local grain reserve scale must be implemented, a system for commercial enterprises of important commodities to store on behalf of the state must be established, and the system for sugar enterprises to store on behalf of the state must be improved.
Li Guoxiang said that the No. 1 Document specifically proposes a sugar storage-on-behalf system, which may indicate that sugar, as the next category for agricultural product price reform, has entered the decision-making level's agenda.