No. 1 Document Sets the Course for Agricultural Development Mode: Three Major Priorities for Agriculture-Related Reform Next Year
Economic Observer reporter Jiang Yunzhang. Following the convention of the past 11 years, next year's Central No. 1 Document will still focus on the “three rural issues” (agriculture, rural areas and farmers), and this time it will likely take “accelerating the transformation of the agricultural development mode” as its theme to lay out the work on the “three rural issues” for the new year.
Xu Xiaoqing, a researcher at the Development Research Center of the State Council, told the Economic Observer that at the Central Rural Work Conference to be held late this month, the relevant authorities will, around the theme of “accelerating the transformation of the agricultural development mode”, lay out in detail the tasks for the three rural issues in 2015. In the Central No. 1 Document to be issued next year, there will also be a more detailed exposition of how to “accelerate the transformation of the agricultural development mode”. In addition, the target price reform for agricultural products, the regulation of farmland transfers, and the reform of the rural collective property rights system, which agricultural professionals generally follow closely, will also be priorities for next year's “three rural issues” reform.
The transformation of the agricultural development mode covers a very broad scope. According to the requirements of the just-concluded Central Economic Work Conference, agricultural production must shift as soon as possible from mainly pursuing output growth to placing equal emphasis on quantity, quality and efficiency, focusing on improving competitiveness, focusing on agricultural technological innovation, and focusing on sustainable intensive development, taking the path of modern agricultural development with efficient output, safe products, resource conservation and environmental friendliness. The ultimate goal is to safeguard food security and continuously increase farmers' incomes.
The Central Economic Work Conference also made clear that improving the target price mechanism for agricultural products, strengthening rural financial services, and regulating the farmland transfer market are all key elements in accelerating the transformation of the agricultural development mode.
Transforming the Mode
The Central No. 1 Document has focused on the “three rural issues” for 11 consecutive years, but with regard to agricultural production and grain production, in the past the emphasis was more on output and quantity. If the 2015 Central No. 1 Document takes “accelerating the transformation of the agricultural development mode” as its theme, it is fully evident that the central authorities have moved from the past one-sided pursuit of agricultural output and quantity to placing greater emphasis on the sustainable development of agriculture, also putting the quality and efficiency of agricultural production on a par with output and quantity.
In fact, as early as the report to the 17th National Congress of the Communist Party of China, released in October 2007, the central authorities already clearly proposed transforming the agricultural development mode. In the Central No. 1 Documents of several consecutive years thereafter, it was also repeatedly reaffirmed that the transformation of the agricultural development mode must be advanced. But judging from agriculture-related data published in recent years by the Ministry of Agriculture, the Ministry of Environmental Protection and the Ministry of Land and Resources, due to problems such as worsening soil and water pollution and low agricultural production efficiency, the agricultural production environment has shown a trend of worsening day by day.
At the end of last year, the Ministry of Land and Resources released the main data of the Second National Land Survey. At present, China's per capita arable land is 1.52 mu, less than half the world average. In addition, about 50 million mu of arable land nationwide has suffered moderate to severe pollution, and over a fairly long period the state will need to spend tens of billions of yuan each year to restore and remediate heavy-metal-polluted arable land.
In April this year, the Ministry of Environmental Protection and the Ministry of Land and Resources released the latest national soil pollution survey bulletin. The soil environmental quality of arable land nationwide is worrying, with 16.1% polluted to varying degrees. To this end, the state will further strengthen the function of soil environmental supervision and plans to establish a lifelong accountability mechanism for soil pollution liability.
Beyond arable land pollution and ecological pollution, “who will farm the land” is also a difficult problem that many “three rural issues” experts follow extremely closely. Because the returns from farming are relatively low, there are now more than 260 million migrant workers working in cities nationwide, and those left in rural areas to farm are basically the elderly, women and children. Even for grain cultivation, where in the past two or three crops could be grown each year, now it has been changed to one or two crops. Behind the national grain output's “eleven consecutive increases”, “who will farm the land” in the future is in fact a major hidden concern for Chinese agriculture.
For a long time, because agricultural production and grain production have basically still followed the development path of traditional agriculture, achieving output growth including that of grain through extensive management that pits resources and consumption against each other, many problems have accumulated in current agricultural production. Judging from the signals just released by the Central Economic Work Conference, the next step, “accelerating the transformation of the agricultural development mode”, in fact means realizing the transformation from traditional agriculture to modern agriculture. Specifically, it means “taking the path of modern agricultural development with efficient output, safe products, resource conservation and environmental friendliness”.
Deepening Reform
The Central Economic Work Conference made clear that in 2015, under the major premise of “accelerating the transformation of the agricultural development mode”, the various rural reforms must be further deepened. As for the target price reform for agricultural products and the regulation of farmland transfers, which agricultural professionals generally follow closely, the central authorities also made clear that these will be priorities for next year's “three rural issues” reform.
Specifically with regard to the target price reform for agricultural products, this year the state has already launched a pilot target price subsidy program for cotton in Xinjiang, and launched a pilot target price subsidy program for soybeans in Northeast China and Inner Mongolia. So far, this reform has not involved the three major staple grain varieties: wheat, corn and rice.
As for whether in 2015 the target price will be extended to other major agricultural product varieties, an official of the National Development and Reform Commission who declined to be named explained that everything depends on how the cotton and soybean reform pilots turn out, and this situation will only gradually emerge next year. At present, the National Development and Reform Commission, the Ministry of Finance and other parties still have no timetable for advancing the reform.
Li Guoxiang, a researcher at the Rural Development Institute of the Chinese Academy of Social Sciences, once participated in discussions on target price reform policy. He said that next year it is possible that a target price system for sugar cane may be implemented in Guangxi, and that on the whole the pace of advancing target price reform is expected to be very slow, while for the three major staple grains it will be even more prudent.
With regard to land transfers, at the end of September this year the Central Leading Group for Deepening Reform deliberated and approved the “Opinions on Guiding the Orderly Transfer of Rural Land Contractual Management Rights to Develop Appropriate-Scale Agricultural Operations” and the “Pilot Plan for Actively Developing Farmers' Shareholding Cooperation and Empowering Collective Asset Shares”. Although the two documents have not yet been promulgated by the authorities, from the recent public statements of several agricultural officials it is basically possible to understand that the central authorities have clear restrictions on farmland transfers.
Chen Xiwen and Han Jun, both deputy directors of the Office of the Central Leading Group for Financial and Economic Affairs, have publicly stated that farmland transfers must be “appropriate in scale”. Regarding the phenomenon in many places of urban industrial and commercial capital going to the countryside and leasing farmland on a large scale for long periods, both Chen and Han believe that the problem of using farmland transfers as a pretext for “de-agriculturalization” and “de-grainization” is now intensifying day by day, and at the same time it has squeezed farmers' employment space. It is expected that the authorities will set stricter policy management measures.
In addition, the Economic Observer learned from the Development Research Center of the State Council and various other sources that the reform of the rural collective property rights system is also an important part of deepening rural reform in 2015, and will involve a series of reforms such as allowing collective construction land to enter the market, the rights over farmers' homestead land, and developing farmers' shareholding cooperation.