Errors in urbanization must be avoided

China should learn from the negative urbanization experiences in foreign countries and set out a clear plan from the start, economists and entrepreneurs said at the Boao Forum for Asia.

Neville Power, chief executive at Australian iron ore company Fortescue Metals Group, said urbanization should go hand in hand with industrialization. If this happens China will avoid the negative experiences of Latin America, where large numbers of migrants flocked into big cities before industrialization and inadequate job opportunities led to slums within cities.

"Cities should provide a variety of residential conditions for city dwellers, where high density areas coexist with low density suburban areas," Power said.

Laurent Malet, a board member at French engineering group EGIS, said experience in the West demonstrates that it is very important to build hybrid urban communities in which poor and rich, young and old can live together, and each community should integrate commercial, residential and industrial zones.

Zhang Yue, president of Broad Group, a Chinese air conditioner manufacturer, who has intensive international travel experience, agreed it is important to build hybrid and concentrated urban communities.

"In China's urban planning, for the sake of city outlook, commercial, residential and industrial zones are built separately," said Zhang. "If built separately, considerable time will be spent on roads linking each other. Enormous energy will be wasted and air will be polluted."

He said local governments in Germany encourage offices to be built in residential areas by giving incentives to builders and encouraging apartment rental or community redevelopment in commercial centers. These efforts are all aimed at building hybrid communities.

"It is imperative to have scientific urban planning from the very beginning, because in a large country such as China, there is no room for trial and error," Zhang said.

Fred Hu, chairman of Primavera Capital Group and former Greater China chairman for Goldman Sachs Group, said urbanization is a complicated process that does not only involve the concentration of people but also the concentration of industries and service sectors.

"Without concentration of industries and available job opportunities, transferring rural residents to become urban dwellers is meaningless. It would merely be a change from rural poor to urban poor," said Hu.

Hu also suggested abandoning the hukou (household registration) system, which excludes urban migrants from equal access to healthcare, education and housing services.