By Liu Yong, DRC

2018-7-20

Viewing from the perspective of optimizing the structure and layout of urban and rural regional economy, reconstructing the new mechanism of coordinated development in urban and rural areas can make an irreplaceable and significant contribution to effectively coping with the challenges brought about by the Sino-US trade friction.

To effectively cope with the challenges caused by the unexpected trade frictions between China and the United States, it is necessary to adopt comprehensive measures in various aspects, such as expanding domestic demand, accelerating the upgrading of industrial structure, promoting the transformation of development pattern, establishing the innovation system of core technology, strengthening the implementation of high-quality development strategy and maintaining the stability of China’s general development strategy. We need to minimize the possible adverse effects induced by Sino-US trade frictions to the full extent, and to ensure the building of a moderately prosperous society in all respects and comprehensively achieving the grand goal of modernization on time.

With regard to the development of regional economy, a region is composed of three elements including townships, farmland and transportation system. The smallest integrated unit composed by the three elements is a county. Therefore, the regional economy can be regarded as a multi-level regional economic system with county as the basic unit, and townships, farmland and transportation system are the three functional elements of the regional economy. As the basic component of regional economy, the county-level regional economy plays an extremely important fundamental role .

As regards regional economic development in various countries, there are only three ultimate directions and formations (or top-level designs) for county-level economic development. First, it has developed into an urban county, including the capital metropolis county, the provincial metropolis county, and also the prefecture-level metropolis county in China, which accounts for less than 20% (15% in the US and 10% in China) of the total number of counties in a country. Second, it has developed into a modern agricultural county, generally accounting for over 80% of the total number. Third, it has developed into a so-called suburban county between the above-mentioned two kinds (which is generally classified as modern suburban agricultural county). Therefore, the key to the reconstruction of the new mechanism of coordinated development in urban and rural areas with the county as the basic regional economic unit is to deal well with the following three tasks.

1. Efforts need to be made to put the township management back and under the county or regional management. The townships originate from the region, and its origin and development cannot be separated from the region. Stronger regional support is needed to tackle township problems. In order to realize high-quality development and modernization in the townships, the prerequisite is to achieve urban and rural integration. To put the township management back and under the county or regional management, it is necessary to shift from the urban and rural administrative management system back to the model of township management under regional administration. The individual townships need to be put under regional administration so as to coordinate and address the common problems in different townships. Only when the township government is put under regional administration, can the township problems be solved at the institutional level, such as township boundaries (generally speaking, a township enjoys infrastructure facilities, and the areas beyond that belong to farmland or unused land), township size, township division, and township clusters.

2. Efforts need to be made to effectively improve the scale economy of agriculture. The present agriculture in China cannot be regarded as small-scale farming. In comparison, Japan has the typical small-scale farming, which is also the moderate-scale economy, and the commercial or industrialized agriculture. But the current agriculture in China should be called “micro-agricultural” or “milli-agricultural” farming. Most rural areas are still engaged in self-sufficient and primitive farming, which has not yet been commercialized or industrialized. Regarding the current development of China’s new urbanization, we need to further promote and improve the urbanization mechanism of “land-based social security” model on the basis of vigorously encouraging the construction of distinctive townships that mainly serve agriculture, rural areas and farmers. We need to encourage disadvantaged social groups from rural areas to move into the city. The vast rural land will be handed over to specialized new farmers, who have knowledge of agriculture, to carry out large-scale modern management, so that China’s agriculture productivity can catch up with the developed countries as soon as possible.

3. It is necessary to build a basic national social security system integrating urban and rural areas at an early date. We need to clarify that establishing a basic social security system covering all people has nothing to do with the level of economic development of a country. Many countries in the world with different economic development levels have established their own basic social security systems. In fact, the funds required by the social security system are a fixed proportion of a country’s GDP, which is relative to its income level, and it has nothing to do with the total amount of GDP. The proportion can also be adjusted by the legislative bodies through appropriate procedures and in accordance with the economic and social development performance. With the constant improvement of China’s market economic system, the time has come to build a basic national social security system integrating urban and rural areas. With the help of this system, the free flow of population between urban and rural areas in China will become more smooth, which can help strengthen the connection of targeted poverty alleviation and social security, and can also encourage disadvantaged rural groups to go to cities, so as to effectively relieve the pressure on the society caused by poverty-stricken population. All of these will be conducive to improving China’s resource allocation efficiency, optimizing the population distribution in urban and rural areas, comprehensively building a moderately prosperous society, and improving people’s moral standards.