Bigger farms reap bigger fortunes upon rural land reform

As the owner of one of the largest family farms in Xuancheng city, Anhui province, Zan Xiaoma has been both elated and deflated by his farmland.

Through planting rice on some 2,000 mu (133 hectares) he rents from those who abandoned farming to seek fortunes in the cities, Zan pockets over 1 million yuan (164,000 U.S. dollars) every year. Profit notwithstanding, his large-scale farming has reached its limit as he lacks funds and confidence to expand his business further.

"Financial support does not come easily for big family farms," Zan said. "Besides, I don't dare invest much in infrastructure as my leases with other farmers are usually only for 5 years. Nobody can assure me as to what will happen when the leases expire," he added.

With new rural reform to be rolled out soon, Zan sees solutions to his problems and dreams of a bigger fortune still.

TOP-DOWN PLANNING

China's rural reform started in 1978 in a village of Anhui, with the introduction of the household contract responsibility system, which ended communal farming. Agricultural productivity significantly increased when farmers got their own contracted land.

Unlike the bottom-up system of 36 years ago, progress today needs more planning at the top, said Wang Weiguo, a law professor at China University of Political Science and Law.

After more than three decades of breakneck economic expansion, China's urban-rural divide is alarming, a problem China's leadership is addressing through a more fair land policy.

Urban land is owned by the state and most of rural land is normally under collective ownership. While trading of land-use rights in urban areas has evolved into a vigorous market over past decades, the situation in the countryside has remained largely stagnant as farmers only have the right to use contracted land, but cannot directly trade or mortgage it.

Lured by better employment and salaries, as many as 260 million farm workers have left the countryside for cities. A side effect of the exodus is a vast amount of land being left uncultivated. Farmers have very little wriggle room in land transfers and don't make much money from land deals anyway, so they often simply abandon their land and start afresh on their urban journey.

With food security and the economic potential of rural and ex-rural residents foremost in their minds, authorities are promising more property rights for farmers. These include transfer and mortgage of land-use rights, and the ability to take shares in large farming entities, according to a document released after the Third Plenary Session of the 18th Communist Party of China Central Committee last November.

As the policy-making meeting concluded, Anhui announced its own plans, once again leading rural land reform. Twenty counties will pilot a new system of rural property transfers, with new modes of financial support for conglomerate farms being explored.