Ecological Economics

Land use profile of China


The story of land use in China over the last century is as dramatic as the tale of the country's radical economic transformation. Endless acres of rural lands, that just a few decades ago were farmed by peasant collectives as part of Mao Zedong's massive agricultural campaigns, today host brand new condominium developments, as China's cities rapidly fan out past their existing boundaries. Giant factories dot the countryside in even the most remote provinces and manufacture all sorts of goods for export into the international market. In many ways, this process of shifting landscapes indicates an accumulation of wealth in regions that still suffer considerably from high poverty rates.

The human cost of the rural construction boom can often be measured in the number of displaced peasant families, who typically have little recourse to prevent the repurposing of their multi-generational homelands. Rapid development has also had an effect on China's ecosystems, and erosion and industrial pollution are now major concerns in most parts of the country.

caption (Source: Central Intelligence Agency World Factbook)

These changes in the Chinese landscape can be attributed to macro-level, underlying catalysts in the form of state policy and values, as well as proximate, micro-level forces, such as the decisions of local officials.

History of Chinese land use

The formative years of the People's Republic of China were marked by large-scale agricultural campaigns, the most famous of these known today as the "Great Leap Forward".  This particular campaign, which began in the late 1950s and continued for about five years into the early 1950s, represented an effort on the part of Chinese Communist Party Chairman Mao Zedong to fund his vision of a Soviet-style industrialized socialist republic with profits extracted from agricultural surplus[1].  China's lack of a true proletariat class and its considerable rural history meant that the peasants were to be the vanguard of the socialist revolution under the new regime, which highlighted a major departure of Maoist ideology from the Marxism of the Soviet Union[2].

To facilitate the colossal levels of crop production necessary for the success of the project, the government relocated millions of Chinese citizens from regions that had been reclaimed for agricultural purposes.  These displaced citizens were organized into farmers' communes.  Many of these repurposed areas had retained private landlord ownership structures prior to the Land Reform Campaign of 1950-52, during which all of the lands in the nation were collectivized under state proprietorship[3].  Intensive cultivation and the transfer of non-agricultural expanses into production caused some of the first instances of widespread ecological destruction in modern China.  In the northwest of the country, for instance, sharp increases in the frequency of dust storms correlated directly with the campaign's upswings in farming activities and not with deviations in weather patterns[4].

Current land use trends

While the state still claims exclusive ownership over all lands in China, land use policy looks strikingly different today than it did fifty years ago.  The laws under Mao were characterized by "free use (no land prices, taxes or fees), permanent possession (no expiration) and static land use (prohibition of sale, lease, mortgage, exchange and donation)"[5], while today's land administration features "re-generation of land markets, land taxes and land fees, separation of land usage rights from land property rights, upgrade of land productivity, and prosperity of real estate"[6].

caption A family's township enterprise orchard. (Source:

The first steps in this process came with the introduction of the household responsibility system in 1978, during the beginnings of the opening-up reforms under Deng Xiaoping[7],[8].  The system set production quotas for each household and eventually permitted families to sell their post-quota surplus.  The incomes of many peasant households drastically improved[9].  The reforms further fragmented the rural landscape, as land rights shifted the industrial production unit from the collective to the household in the form of township enterprises[10].

However, until quite recently, state planning was the de facto approach to land use in China, even amidst the sharply accelerated growth of the past few decades.  The current National Master Land Use Plan, which was first implemented in 1997, outlines policy priorities for land use through 2010.  The strategy aims to "preserve cultivated land and to restrain non-agricultural use of land"[11] by mandating that every conversion from agricultural land for other purposes must be balanced by a supplementation of new farmlands.  Under this plan, three important regulations restrict the freedom of provincial officials to lease development and construction rights.  These include quotas limiting new construction, preserved rates for agricultural land, and mandated post-conversion farmland supplementation[12].  Thus, even as urbanization and industrialization emerge as potent forces in land use, state planning still limits these trends, to some extent.

"Zhejiang model"

A new paradigm in land use regulation is becoming popular in China, especially among advocates of the expansion of urban areas.  The "Zhejiang model", so called because of its origins within the Zhejiang province, operates to enhance the ability of provincial officials to trade land development rights through land consolidation[13].

The model works within the stipulations of the National Master Land Use Plan, and it considerably increases the availability of construction land. For instance, one hundred hectares of consolidated land could produce ten hectares of arable land for agricultural reclamation, which would then allow the local government to acquire an additional allowance of seven hectares of eligible construction land under the current quota system[14]Land development rights trading provides a major source of fiscal revenue for provinces and local governments[15],[16], so the potential for the "Zhejiang model" to maximize their quotas appeals to many Chinese officials.

However, the continued investment in new construction land does not necessarily accrue financial benefits for the nation's macroeconomy.  Some[17] contend that an analysis of the capital-output ratio for residential and industrial development between 1995 and 2008 suggests that the construction booms in China have in no way contribured to economic growth[18].  They argue that, in fact, the escalation of development projects may actually be harming the economy's ability to grow sustainably[19]

There are additional, substantial risks in the continued spread of urban and industrial networks.  While land consolidation is supposed to redress a deficiency in agricultural space, the reality is that the conversion of such wide swaths of fertile land for non-agricultural purposes has contributed to a reduced capacity to grow cereals, which ultimately threatens Chinese food security[20],[21].  Farmers, who do not own their lands despite multigenerational residency, often find themselves evicted from their homes and become part of the millions in migrant communities existing on the fringes of China's megacities.  Some[22] argue that such uncertain entitlement to land discourages farmers from practicing responsible stewardship and instead contributes to overexploitation of land resources[23].  Furthermore, the transformation of previously rural regions into denser, manufacturing economies can cause "soil pollution through waste disposal, acid deposition from urban air pollution, and an increased risk of flooding due to urbanization"[24].

The expansion of urban and industrial landscapes into China's rural provinces may be threatening a shortage of farmlands just as demand for agricultural products is increasing significantly. The two primary drivers of this demand are emergent biofuel needs and a growing affluent urban citizenry.

Demographic changes and land use

China's demographics began to undergo significant transformations with the introduction of the household responsibility system.  The period directly following the policy change saw a mechanical expansion of rural villages that continued throughout the 1980s[25].  As families began to profit from their surplus crops, many households developed orchards, or "economic forests", as alternatives to the cotton and coarse grain land that were previously devoted to fulfilling heavy state quotas.

In the 1990s, the rising incomes of rural households and an emphasis on improved quality of life drove patterns of "sprawling expansion"[26].  Residents built new houses on the periphery of the villages, motivated by low costs for land, potage, and water supply extension, education services expansion, and construction[27].  Overall, citizens placed greater weight on luxuries such as increased living area and pleasing aesthetics, but most families still cultivated their lands for agricultural profit[28].

More recently, however, the Chinese population has become increasingly urban.  Out of fifty households in the QIanzhai village in Shandong Province, for instance, only ten continue to farm for a living, according to a 2008 survey[29].  Instead, forty households, by contrast, received the bulk of their income from family members who were sent to the cities for manufacturing jobs[30].  The country's burgeoning urban lifestyles have not only stimulated the growth of economic capitals such as Shanghai - they have also contributed to a recentralization of rural villages.  Desires for metropolitan services have motivated affluent peasants to abandon the farms in favor of more convenient rural "downtowns"[31].  However, just as Chinese begin to leave the farms, those same cosmopolitan tastes are propelling a surge in demand for agricultural production.

The Chinese government has made an effort to farm previously uncultivated lands in order to replace the crop production capacity of urbanized arable lands.  However, many of these newly cultivated lands are thought to be significantly less productive than would be necessary to compensate for the crop production lost to increased development on agricultural land [32].

Despite China's massive size, the country's actual “endowment of land and water resources, on a per capita basis, is notably below the world average”[33]. These circumstances are especially worrying because, as an increasingly affluent society, China's per capita demand for these same resources is growing remarkably quickly as diets continue to change[34]. The increased consumption of meat, for instance, has stimulated an expanding animal farm economy, which remains one of the most exacting industries on natural resource extraction and pollution sinks[35].

Biofuel production

In response to both international pressures as well as the domestic strain of rising oil prices, China has recently devoted a great deal of policy attention to the development of a biofuel market.  The government has particularly emphasized ethanol, or corn-based fuel.  The state has revealed a series of plans aimed at the expansion of ethanol growth as a means of climate change mitigation and energy independence.

One of these national plans, the "Special Development Plan for Denatured Fuel Ethanol and Bio-ethanol Gasoline for Automobilies in the Tenth Five-Year", was created in 2001 to test the ability of the Chinese industrial and agricultural markets to support ethanol production and refinement.  Following a series of automobile tests to determine the efficiency of the fuel, four refinery plants were established, and nine provinces were selected for pilor programs of ten percent ethanol gasoline[36].

The passage of the Renewable Energy Law came soon after these programs and reiterated the cental government's goal of a clean energy economy.  The Renewable Energy Law mandated the development of the "Middle and Long Term Development Plan of Renewable Energy", which was released in 2007[37].  The plan calls for the production of 10 million tons of ethanol biomass by 2020 as well as the continued mandatory mixing of ten percent ethanol in gasoline in the same nine provinces to secure the biofuel market; the waiver of a five percent consumption tax on ethanol; the refunding of a seventeen percent value-added tax to the bio-ethanol production plants; and a direct subsidy to biofuel plants to ensure a significant level of profit[38].

Yet, in China, as in many other countries, the expansion of the ethanol market has accompanied a rise in food prices[39].  These price increases, combined with the conversion of arable lands for urban and industrial purposes, has severely hampered the Chinese central government's food security goals.  In the 1990s, the government set a target of grain self-sufficiency, to be completed within the decade.  The measure was successful, and China remains a net exporter of grain products[40].

However, the country still struggles to produce adequate amounts of soybeans, which constitute a large share of the typical Chinese diet[41].  As it became increasingly clear that ethanol demands on agricultural production would threaten the current levels of food security, the National Development and Reform Commission issued a decree that stipulated that "biofuel must not compete with grain over land, must not compete with consumers for food, and not enter competition with livestock over feeds, and must not inflict harm on the environment"[42].

In the efforts to prohibit future increases on grain demand for biofuel production, some suggest a switch to alternative biofuel sources such as cassava or sugarcane[43].  However, they contend[44], the subsidies required to maintain this market would be substantial[45].  While farm value would be added to the grain market and farmers in this industry would likely benefit, increased feed prices would negatively impact those in the livestock industry.  The already particularly impoverished Tibetan autonomous region might be especially affected in this scenario, because of its lack of suitability for grain production and heavy reliance on livestock[46].  Finally, the additional requirements of farmland necessitated by the ethanol market would contribute to already-existing patterns of land degradation in regions such as the Ordos and Loess plateaus.  Such regions are subject to intensive cultivation to offset arable land conversions, and further intensification might threaten long-term sustainability of food production due to land degradation, pollution, and declining soil fertility[47].  The forms of land degradation that often result from these scenarios include desertification, secondary salinity, loss of agricultural use, deforestation, grassland degradation, and the loss of wetlands.


In China, land use master plans are issued at different levels of government, including the national, provincial, municipal, county/town, and village levels[48].  All levels, below the national level, are collectively referred to as "local land use master plans"[49].  The Ministry of Land and Resources promulgates regulations for land use and for the review of land use master plans and Strategic Environmental Assessments[50],[51].  The Ministry supervises the development of national and cross-provincial land use plans[52], while local land administration departments review local land use master plans[53].

Strategic Environmental Assessments

The Strategic Environmental Assessment (SEA) became a required element of land use planning in China following the passage of 2003's Environmental Impact Assessment Law [54].  The assessment process is reminiscent of the Environmental Impact Assessment requirements instituted in the United States through NEPA.

SEA rules apply to all plans developed at the municipal level or higher[55].  Businesses are also required to follow the SEA process when planning to construct new facilities or expand existing structures [56].

Each draft land use plan must include a chapter or illustration on the project's environmental impacts.  This Environmental Impact Statement must contain an analysis of the current environmental conditions of the proposed site; a forecast of environmental impacts that might result from implementation of the plan; and suggestions for mitigation measures[57].  This system is designed to ensure that consideration of a project's environmental impacts will be incorporated into that project's planning stages[58].

Certain forms of land use planning require a separate, supplemental Environmental Impact Statement to be filed in addition to the standard draft plan chapter[59].  These special plans are required for development of industrial, agricultural, animal husbandry, or forestry facilities; for utilization energy resources; for urban construction or traffic projects; for water conservation plans; or for projects which will affect tourism or natural resources[60].  The supplemental statement must be fuled after the draft plan is developed but before its submission and approval[61].  Furthermore, if a plan may have an adverse environmental impact or affect the public interest, then public debates must be held during the planning stages[62].

Local land administration departments are responsible for the implementation of draft plans, and are therefore responsible for choosing the technical agency which will conduct the SEA.  These departments must also oversee a follow-up assessment after the approval of the draft plan[63].


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Yanefski, J. (2013). Land use profile of China. Retrieved from