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Old August 28th, 2009, 02:05 PM   #121
Atmosphere
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I don't know if that's good for the city. Every city has a city center right. Well in a city that big you would need multiple city center or else it will become too crowded. The problem is you can't build a second or third history museum. There always will be one real city center with unique museums and other sites that everyone wants to visit. You would need roads with 30+ lanes and 20 or more subway lines to get everything going

Urban planners will have a very hard but exciting time in China the coming years.
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Old August 28th, 2009, 06:20 PM   #122
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I don't know if that's good for the city. Every city has a city center right. Well in a city that big you would need multiple city center or else it will become too crowded. The problem is you can't build a second or third history museum. There always will be one real city center with unique museums and other sites that everyone wants to visit. You would need roads with 30+ lanes and 20 or more subway lines to get everything going

Urban planners will have a very hard but exciting time in China the coming years.
But we see that it works in Tokyo, which has a whopping 35 million people. You could still build more subways or motorways. If you want to run a city with 60 million people, you need the best public transit system in the world.
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Old August 30th, 2009, 07:38 AM   #123
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Yes it will be incredible. I hope that Shanghai will reach 60 million people.
if tokyo can be 35 million, then shanghai can be 60 logically. but i still can't image a 60 million pop shanghai, my city (120km west of shanghai) maybe involved.
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Old August 30th, 2009, 07:11 PM   #124
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if tokyo can be 35 million, then shanghai can be 60 logically. but i still can't image a 60 million pop shanghai, my city (120km west of shanghai) maybe involved.
I thought of 60 million within the municipality.
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Old March 12th, 2010, 01:57 PM   #125
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FEATURE-Urbanising China long way from residence reform
11 March 2010

BEIJING, March 11 (Reuters) - They build the skyscrapers and lay the highways, mind the city children, sew the clothes and tend the shops, but China's army of migrant labourers are still fundamentally aliens in the country's bustling urban centers.

Despite a push for reform ahead of this week's annual legislative meeting, the household registration, or hukou, system is likely to stay in place for the near future, slowing China's rapid urbanisation by denying city services to its estimated 200 million migrant workers.

Granting them rights in cities could encourage them to spend more, fulfilling the goals of central planners to raise Chinese consumption and reduce dependence on export markets.

Reformers were disappointed when Chinese premier Wen Jiabao, who has made fairness and reducing income disparities a hallmark of his administration, called for relaxing the hukou requirements only in small and medium cities in his work report this month.

He didn't mention giving migrants equal treatment outside their provinces, or in China's biggest cities.

As evidence the central authorities are not open to radical change, editorials calling for abolishment of the hukou system were removed from most of the websites of 13 regional newspapers. The papers had launched a rare coordinated call for reform earlier this month.

The deputy editor who wrote the editorial for the Economic Observer was fired, the New York Times reported on Wednesday.

Defenders of the system contend cities are unable to provide the services migrants demand in the absence of a nationwide and transferable social security network.

"The main problem with changing this system is some powerful opposition, especially from the public security apparatus and the city governments who face a really high cost," said Dorothy Solinger, a political scientist at the University of California, Irvine, who has written about China's hukou system.

"They'd have to expand schools for migrants as well as pensions and benefits for people who have moved temporarily, or even permanently, to the cities. There's been a real plea from city governments not to burden them."

Police oppose the abolition of the hukou system because they would lose control over China's "floating population," many of whom are poor. Migrants convicted of crimes often end up serving harsher sentances, because of confusion over jurisdictions, prisoners' rights advocate, the Dui Hua Foundation, said.

FLOW OF REMITTANCES

Hukous date from the famines of the late 1950s, during Mao Zedong's disastrous experiment with collective farms. Rations were tied to where people were registered, keeping starving peasants from flooding into better-fed cities.

Half a century later, a new generation of migrants call the cities home, with nary a glance back at the fields their grandparents tilled.

Reform would let them buy houses and bring their children to live with them, slowing the flow of remittances to villages.

"If I could change things, I'd get a Beijing hukou right away," said Lu Zhaolu, a carefully made-up woman from Northeast China whose 16-year-old attends a school for migrants in Beijing.

"There are a lot of advantages. For instance, I could apply for a mortgage to buy an apartment. Now I can't get a loan."

The migrant families who have settled in Beijing are now so permanent that city officials tolerate, but do not certify, about 260 schools each with 400-500 migrant students.

Several of those schools fell victim to developers' bulldozers this winter, along with surrounding communities of makeshift housing.

"By sixth grade, some of our pupils have been through 15 schools. This really affects their education," said Li Dengfeng, who runs a school for migrant children in Beijing's outskirts.

Most migrant children only make it through junior high before dropping out to become labourers themselves, Li said.

Many jurisdictions have abolished the distinction between residents of urban and rural districts, in response to the rapid urbanisation that has swallowed former villages into city sprawl.

That could help foster development of smaller cities throughout China, creating jobs closer to family and diverting labour from export centres like Guangdong. Localised shortages this month have led to talk of wage hikes.

FARAWAY FACTORIES

"Those who have been working outside the province for a long time already have quite settled jobs, already have homes," said Zhang Zuoha, vice-governor of Sichuan province, which contributes 20 million rural people to the national labour pool.

"In each place they want to be accepted, get a household registration and resolve their household registration problems."

No reforms have yet bridged provincial lines, even though the factories of the south and the coast attract migrant workers from thousands of miles and many provinces away.

Pension and medical insurance plans designed to allow workers to transfer between jobs generally don't cross provincial lines, so workers are reluctant to pay into them.

That has resulted in one of the biggest contributions that migrant workers have made to China's economic growth -- their lack of legal protection has helped keep Chinese wages low.

"There's more paperwork for outsiders to find jobs, and the salaries tend to be lower," said Shi Jing, a young migrant shopkeeper with bleached hair and a fashionable green coat and leggings. "The job agencies don't trust outsiders as much."

Chinese such as Shi who have been migrants for more than a generation have little attachment to the hometowns where they are supposed to return for paperwork, medical reimbursements or for children to attend officially recognised schools.

"We need to change our attitudes towards migrants," said Chang Dechuan, president of Qingdao Port Group. "The old attitude was to use them because their wages are cheaper, and they cost less than city residents. I think this is outdated,"

"Nowadays, migrants are no longer just unskilled peasants."
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Old March 14th, 2010, 10:53 AM   #126
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Outstanding article and very informative!
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Old March 15th, 2010, 12:37 AM   #127
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China is still slowly "phasing out" the old hutongs, aren't they? I know they've protected some in Beijing but they're going to need space for expansion sooner or later if people continue to migrate into the cities. Hopefully the hutongs don't disappear completely.
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Old March 16th, 2010, 01:21 AM   #128
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China is still slowly "phasing out" the old hutongs, aren't they? I know they've protected some in Beijing but they're going to need space for expansion sooner or later if people continue to migrate into the cities. Hopefully the hutongs don't disappear completely.
Yes part of Beijings fun and beauty are the Hutongs. Some areas are restored and cleaned but they change more and more nonetheless. With the olympics many streets got asphalt for example. I saw some parts being replaces by huge shopping malls. A sad thing but understandable as more and more people move to the cities. I think the real old Hutongs wont last long. The small areas that are being preserved will become very touristic and the classic old Hutongs will slowly disappear...
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Old March 16th, 2010, 11:53 PM   #129
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its a shame, but for a city at last count with 22 million (including non-permanent residents) there's little urban planning devoted to preserving a one storey centre. Though a few hundred streets have been saved, there used to be thousands.

The original hutongs were once elegant middle class homes, but over the years became subdivided as the population grew, and bastardised by brick add ons and outhouses (and for hundreds of years the council enforced the one or two storey rule - no building could be higher than the Forbidden Citys great halls), to the point the average Beijinger enjoyed 1 sq. metre of living space by the 1990s.

The old days, when hutongs were large courtyard homes:

[img]http://i36.************/s5iywp.jpg[/img]



1990s - vibrant and full of traditional life -yet they had become slums, or unrecognisable as old buildings








the same area (Qianmen) after restoration:





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Old April 10th, 2010, 10:18 PM   #130
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That place look very beautiful.

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Focusing on future urbanization
By Andrew Moody and Lan Lan (China Daily)
Updated: 2010-03-22 09:35





Stone carvings of dragon heads on a wall in Chongqing municipality. The southwestern city is among several first and second tier cities across the country that plan to head local economic growth with dragon-like tenacity over the next few decades.[China Foto Press]



New megacities will witness 325 million more people moving to the urban environment from the countryside, report Andrew Moody and Lan Lan in Beijing

Vast Megacities - the like of which have never been seen in the world before - could pave the way to a cleaner environmental future for China, according to a leading environmental lobby group.

By 2025, China will have eight giant cities - Beijing, Shanghai, Chengdu, Chongqing, Guangzhou, Shenzhen, Tianjin and Wuhan - with a population of more than 10 million each, according to international management consultants McKinsey & Co.

They will be part of a massive urbanization trend that will see 325 million more people living in cities in less than a generation.

Wu Changhua, Greater China director of The Climate Group, the international environmental lobby organization, said it was possible to deliver energy and essential services more efficiently to concentrated urban areas.

"Urbanization is regarded as one of the solutions to energy and climate change issues. You can achieve a much more efficient use of energy," she said.

She added planners in China have the opportunity to fashion new cities that will be effectively carbon neutral, making use of state-of-the-art technology.

"China is in a different position from the United States when it developed in the 19th and 20th centuries. Climate change and carbon emissions were not issues then and you put steel factories right in the center of cities like Pittsburgh," she said.

But the speed of China's development will still make it hard for urban planners to contain the environmental risks.

By 2030, 120 million people will live in China's megacities, an increase from 34 million in 2007 when only Beijing and Shanghai were classed in this category, according to McKinsey.

Chongqing, which could be set to be China's first 30 million population city, has been growing at six time the rates it took Chicago to develop in the 50 years before 1900.

It has grown from a collection of towns and villages to become one of the world's greatest new conurbations.

Martin Jacques, author of "When China Rules The World", which predicts China will overtake the United States as the world's largest economy by 2050, said the emergence of megacities will create huge challenges.

"China will have to come up with novel solutions to the challenges this rate of development poses. It cannot just blindly copy the development of cities in the West," he said.

"Clearly cities cannot be built around the car because when car ownership got up to western levels the cities would come to a complete standstill."



Megacities emerging

Ma Xiaohe, vice-president of the Academy of Macroeconomic Research at the National Development and Reform Commission of China in Beijing, envisages megacities emerging with small and medium sized cities in small clusters around them.

"The larger cities can then share resources with the small and medium sized cities creating logistical benefits and a big labor pool and also reducing overall costs," he said.

"This megacity development is the most efficient option for a country like China with high population density and rare land and water resources."

He said the danger for cities and towns that are not part of these new urban clusters is that they could get left behind.

"The economies of areas outside the urban clusters could eventually wither. This has been the case in Japan, where 70 per cent of GDP (gross domestic product) is generated from just the three areas of Tokyo, Osaka and Nogoya," he said.

China is likely to follow a different model to urbanization in Western countries. In Britain, the first industrial nation, people moved from rural areas to work in factories in new emerging cities such as Manchester in the early 19th century.

China's megacities are more likely to be service sector orientated than hot beds of manufacturing employment.

The lure to move to the city will still be the same - to achieve a better standard of living, even though the realties of urban living might be somewhat harsher than expected.



Service jobs

Prof Lu Bin, head of the department of urban and regional planning at Peking University, doubts whether there will be enough service jobs in the megacities to support the size of their populations.

"That is why it is important to have small and medium sized cities supporting the core city. The smaller cities could offer manufacturing employment and people could commute within the conurbation," he said.

"All the various hubs within the great metropolis will feed off each other to a certain extent and there will be an interchange of economic activity and people."

Just 600 million people, or 45 per cent of China's 1.3 billion population, currently live in cities but this is expected to grow to more than 1 billion by 2030.

Some 70 per cent of the new urban dwellers will be migrants from mainly rural areas.

Pu Yufei, a leading researcher at the State Information Center, the government think tank, based in Beijing, said this level of urbanization would provide a major boost to the economy.

"The process of urbanization will create enormous business opportunities and also create demand for goods and services, " he said.

He added that former farmers often prove to be successful entrepreneurs when they move to cities.





Two residential buildings in suburban Tongzhou district in southeastern Beijing. As the municipal government plans to build a new downtown for China's capital city in Tongzhou, the price of homes in the district is increasing sharply. [China Foto Press]



About farmers

"Many farmers may set up their own business and become entrepreneurs. Many of them set up businesses related to their agricultural backgrounds because they have a good understanding of what the market needs. They also tend to be very hard working," he said.

"A number of billionaires have been created this way and I expect there to be many more."

Wu at The Climate Group said new emerging cities offered the chance to redress China's concentration of population on the eastern seaboard with the creation of new cities in the central and western parts of the country.

She added there was a need to avoid the urban sprawl of cities such as Beijing and Shanghai.

"Is Beijing energy efficient? The answer is no. It is a city that has developed over many years and hasn't been planned around energy efficiency, " she said.

"Today if you have a piece of land and are going to build a new city, there are tools out there to make sure that it is built around its energy and water needs. Everything can be integrated so much better."

British author Jacques said it was important to understand how far China had traveled on the urbanization journey. In 1949 at the birth of New China it only had five cities with more than one million population.

"China is currently either at the end of the beginning stage or, at best, the beginning of the middle stage of urbanization," he said

He added that megacities offered a solution because of the land scarcity in China compared with other countries.

"When the United States developed land was never an issue. The United States today is only a quarter as densely populated as China. You need to concentrate people to accommodate the numbers of people," he said.

Prof Lu at Peking University believes urbanization and the growth of megacities will be the engine of economic growth for the Chinese economy in the coming decades.

"It will be a process that will help drive the economy forward to the next stage as we leave the current economic crisis behind," he said.

http://www.chinadaily.com.cn/bizchin...nt_9621374.htm
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Old August 10th, 2010, 04:15 PM   #131
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SPECIAL REPORT-China bets future on inland cities

GUSHI, China, Aug 3 (Reuters) - China has put big money down on a momentous gamble: rush to build new cities in its poor interior, then wait for people to come and help drive the economy to a new stage of growth.

Here in this corner of the Chinese hinterland, the government has widened farm lanes into highways, turned wheat fields into an industrial park, spent a fortune on government offices, and set up a school for thousands of students in what was a dusty town a few years before.

Old, cracked gravestones have been bulldozed to make way for a housing estate featuring 60 apartment buildings, a winding creek and tennis courts, the latest such development in Gushi.

But the roads are mostly deserted apart from the odd goat herd trundling along them. The industrial park features a handful of workshops and no big factories. Vast new housing estates fan out from the original town centre, most of them uninhabited. Skeletons of half-built villas, stained from neglect, are splayed across fields.

About 1,000 km (600 miles) south of Beijing in Henan province, Gushi is a microcosm of this latest face of China's urbanisation, featuring ambitious officials, angry farmers, countryside capitalists, a new batch of consumers -- and empty buildings.

Over the past three decades, rural migrants flocked to big, prosperous cities along the coast. Now, in its revamped model of urbanisation, the government is trying to bring cities to its farmers, a project that could absorb more residents than the entire population of the United States in the coming decades.

Farmers such as Xiang Wenjiang are not at all sure they like what they see rising up from their muddy fields.

"This is my land, but now it's all been sold," said the wiry, sun-beaten Xiang, eyeing a row of apartments under construction advancing towards his hut. "I won't leave until they give us the right money for moving, not just a few coins."

The apartment complex encroaching on Xiang's land is part of a vast urban development juggernaut that has become a new engine of economic growth as global demand sputters. It offers enormous opportunities for the companies that dig up the raw materials needed to build the new cities; that make the cars for the new roads and the washing machines for the new homes.

But such high hopes come with ample scope for disappointment. If the unprecedented population shift from villages to cities is mismanaged, it could squander resources, radicalize peasants and damage China's prospects.

RUSHING TO CATCH UP

With 1.7 million people, Gushi is the most populous county in Henan and one of the biggest in the nation. Locals boast it sends out more workers to cities than any other county in China.

This annual flow from farms to factories is at the heart of how China's economy, a welterweight in global terms in 1980, will become the world's biggest in a little more than a decade.

"You are going to see smaller cities being created out of townships, townships created from villages," said Jing Ulrich, chairman of China equities at JP Morgan.

"I do believe in the long-term thesis that playing this urbanisation trend, playing consumption growth on the back of urbanisation and income growth, this is probably one of the brighter spots in the global economy."

Like much of central China, Gushi has been in a rush to catch up with the wealthier coastal regions.

"Failing to develop is the worst kind of corruption," Guo Yongchang said before he fell from power as Communist Party chief of Gushi in 2008. "If you'd prefer not to develop, and you don't get close to businesspeople, then it's more evil than corruption a hundred times over."

That sort of cockiness led to his downfall. He and another former head of Gushi county have been accused of graft. Buildings for a new university that went bankrupt stand abandoned. The town's main factory also went bankrupt.

Villagers denouncing corruption and resisting the loss of farms have turned a strip of land where their fields meet the expanding township into a protest battleground.

"The local officials force the farmers to sell the land for very little. Here there are no controls," said Zhao Jiuzhou, a 24-year-old in jeans, watching local farmers dig the foundations of a new apartment block.

"If you foreigners want to develop here in Gushi, it would be like Cinderella being eaten by the big wolf," he added, mismatching his fairy tales. "Here the officials can make a killing from nothing".

Gushi is not alone. Multiply its problems across thousands of towns and small cities across China, and the risks of the country's headlong rush towards urbanisation become evident.

Yet if the pitfalls are clear so is the potential. Between now and 2040, China's urban population will expand by up to 400 million, according to Han Jun, a rural policy expert who advises the government. In other words, cities will absorb about 15 million new residents every year.

"That means growth," Stephen Green, chief China economist at Standard Chartered, told Reuters Insider TV. "And it means better education and health care. It means higher labour productivity and higher wages. People living in urban areas tend to consume more. So this is really the crux of China's transition into a wealthier, more balanced economy, and the faster it happens, the better."

THE NEW CONSUMERS

From the window of Duan Guofei's new apartment, Gushi's ambition to leap from sleepy town to grandiose city begins to look more plausible -- even if it is not happening as fast as they might like in terms of creating jobs.

Duan and his wife, Rang Fei, live in Xiangzhang Garden, a housing development where many apartments have been sold and real estate agents give tours to a stream of prospective buyers.

Their apartment is decorated with soft-focus wedding portraits, and a large flat-screen television sits across from their glass coffee table. It is a far cry from the mud-brick village homes they grew up in. Duan's parents were farmers and his wife's father a village teacher.

The young couple is part of a generational shift in rural China. They have worked in far-off cities, too costly and officially unwelcoming to offer them a permanent home, and yet they feel too attached to urban life to return to their home villages.

"Before you used to build a house in your home village," Duan said. "Now everyone is buying in the county seat. All my parent's relatives have moved here, because life is so much easier."

Gushi, which lies in a remote corner of Henan province bordering on rural Anhui province, is an intense example of how migration has transformed the Chinese countryside.

About 500,000 of its 1.7 million population work elsewhere as migrants in factories, shops or offices or as merchants, said Cai Liming, deputy head of the county propaganda department. The county government is betting it can draw these migrants back to buy homes, invest their savings and create jobs. But many find only disappointment when they migrate back.

"There's some work here but the wages are lower," said Wu Anxia, who moved here from Shanghai to ensure her son went to a decent school, because government restrictions barred children of migrants from good ones in Shanghai. "I was a warehouse manager in Shanghai," Wu said. "But back here in Gushi, there's nothing. So I became a cleaner."

In the first phase of urbanisation, from the start of the country's post-Mao reform era in 1978 to the present, rural citizens began migrating to booming coastal towns from Tianjin in the north to Shenzhen in the south. About 140 million made the trek last year.

Few of these migrants stay on. The hukou system of residency registration deprives them of benefits, such as public education, away from their home villages. Only 19 percent of rural migrants had settled permanently in cities as of 2004, according to the National Bureau of Statistics.

In the new phase of urbanisation, the government's strategy is not to move farmers to big coastal cities, but to draw them to new urban areas in the hinterland. Its clearest expression came in the Communist Party's No. 1 Document in January, a policy blueprint for 2010. In it, China vowed to reform the hukou system by giving rural citizens the right to the same services as urbanites -- but only if they move to small cities within their own province.

By 2025, the country will have 221 cities with populations of a million or more, compared to 35 in Europe, according to a report by McKinsey & Co, the consultancy firm. China had 108 such cities in 2004.

But whereas work awaited migrants who flocked to factories on the coast over the past two decades, the creation of cities and employment by decree in the interior is less of a sure thing.

China tried once before to develop small cities in a hukou reform experiment in the 1990s.

"There was not much success because of the limited employment opportunities and poor public services in small cities," said Tao Ran, an economist at Renmin University in Beijing. The modern furnishings in Duan and Rang's apartment in Xiangzhang Garden cannot gloss over Gushi's shaky prospects for creating lasting jobs. Duan earns about 2,000 yuan ($295) a month decorating homes. But officials fret the property sector, the pillar of the town's economy, will suffer as empty apartments pile up.

OFFICIAL AMBITION

The man who presided over Gushi's transformation now waits out his days in a detention cell. Guo Yongchang was the Communist Party secretary of the county for four years, before his fall in a cloud of corruption charges last year. One of his subordinates, Fu Kongdao, the deputy head of the county in charge of land decisions, committed suicide in early 2009.

Guo's ambitions for the town, and for himself, are visible across Gushi, and so are the costs. They are seen in the 10-storey polished stone building that dominates the new government compound, in the expansive square next to it, and in the unfinished villas marooned on once-fertile farmland.

"If everyone moved into the county seat, they still couldn't fill all these homes," said Zhou Jun, a taxi driver, as she drove past acres of unoccupied and neglected apartments. Zhou says she can tell which apartments are empty by looking for the air conditioner units outside windows. If they are missing, no one is living inside. Her car passes one building block with 72 windows, just two with air conditioners.

In the curt official announcement, the reason given for Guo's dismissal was corruption at a post before he became boss of Gushi. But residents believe his misdeeds continued, and grew enormously, when he was head of the county.

"He got too greedy, took too much. Here, you could take land, sell it cheaply and make millions," said Ren Jun, a small-time investor in the Gushi property market.

Guo came to Gushi in 2004 with bright hopes for himself and for this town. With his credentials as a lawyer and reputation as a hard-driving official, he itched to launch Gushi and himself onto a bigger stage by working hand-in-glove with local capitalists. "Run the government like it's a business. Run a city like it's a commodity," Guo once told Decision Making magazine, a Chinese business publication.

He was not shy about putting that philosophy into practice. When a local businessman opened a luxury bathhouse -- one of many such businesses across China where businessmen and officials go for saunas and massages -- Guo made sure he and other senior county officials turned up for the ribbon-cutting ceremony. "We must treat businesspeople better," said Guo, according to the 2005 magazine interview. "We've got to bathe with them."

Gushi offered developers cheap land, and lots of it, defying repeated efforts by the country's top leaders to slow land grabs for development.

"The central government has told local governments to entirely freeze land (requisitions), so we must speed up land seizures and seize up to 10,000 mu (1,650 acres) of land. Otherwise, what will we have to develop the city?" Guo told officials, according to a report in the Southern Metropolitan Daily, a Chinese newspaper, in June of this year.

Some of that land went to two vast housing projects -- Phoenix New Town and Xinhe New Town. In return, the developers provided the county government with a stream of revenue that helped pay for new office buildings and monuments.

Near the main government building sits the county outpost of China's central bank. Its carved stone walls and a fountain covered in stone frogs look as if they were torn from an aristocratic European manor and plopped on the plains of Henan. An equally ornate museum, celebrating Gushi's small role as a cradle of the communist revolution, stands empty by the square.

In better days, Gushi's transformation from poor backwater to an urbanising model brought Guo and his government kudos and admiring visits from senior officials. Among them was Xu Guangchun, the Communist Party secretary of Henan province, who told Guo the county had set an example for the province to emulate. "Your ideas are golden," Xu told him.

HOOKED ON LAND

Much of this urban charge is being led by officials aiming to literally leave their mark on the landscape, boosting their career prospects and sometimes their personal wealth. China's worry is that the troubled trajectory of Guo Yongchang is being duplicated, in some way or another, in cities and towns across the country.

Local officials have huge powers over land and investment. But in their ambition to transform dusty towns into aspiring cities, they are leaving behind worrisome levels of government debt and a model of sprawling urbanisation that will exact a toll on the economy and society over time.

Partly it is a case of perverse incentives. Local governments in China have become "hooked on land," in the words of Tao Ran, the economist at Renmin University. A reform of the taxation system in 1994 shifted the lion's share of tax revenues to the central government and left provinces, cities and especially towns with bigger burdens. Over time, they saw that land could plug the gap. Seized cheaply from farmers, it is sold for a tidy profit to developers, many of whom count on cheap funding from state-owned banks to bankroll their construction projects.

Chinese finances are in good health, at least in official terms. The government says its total debt is just 20 percent of gross domestic product, compared with about 80 percent in the United States and nearly 200 percent in Japan. But officials acknowledge the picture is grimmer when local government debt loads are added.

Though legally barred from borrowing, provinces and cities have found ways around the restrictions, often through government-backed investment firms. These financing vehicles have borrowed a total of 7.7 trillion yuan ($1.1 trillion) from banks, according to the China Banking Regulatory Commission. That alone would about double the national debt, and some suspect the total is higher. Realising the potential scope of the problem, the regulator warned banks at the start of this year to limit their lending to local governments.

For years, Gushi had been running full tilt in the opposite direction, trying to find ways to catalyse investment and escape restrictions on local debt. Some of the spending that Gushi routed through its financing units may yet prove worthwhile. In a list of development projects for 2009, the County Construction Investment Co was named as the developer of a water supply plant. It was also listed as the main investor in a hotel and entertainment complex, a questionable need in a town that already had a new hotel and few visitors.

Other examples of wasted land and money litter Gushi's landscape. The abandoned "Heyuan University" campus sits on the edge of town, sinking back into the fields that were taken to build it. A couple of guards mind the crumbling buildings after the investors fled a couple of years ago.

"They've run away and left us with these rotten buildings," said Fu Jinzhi, a wrinkled woman in her 70s living in a village near the campus. "We've been hurt, but what can we do?"

The sheer numbers involved in China's urbanisation are staggering.

To accommodate the onrush of new city dwellers, the country will have to pave 5 billion square metres of road, construct 5 million buildings, including 50,000 skyscrapers, and add up to 170 mass transit systems, the McKinsey report said. All by 2025, it added.

In such haste, mistakes are made.

"This has happened so quickly that the cities have not had an opportunity to grow organically. And there is a real risk that what you are going to be left with is these cities that are very sprawling," said Arthur Kroeber of Dragonomics, an economic consultancy in Beijing.

Little thought is given to energy efficiency or quality of life by officials whose main objective is to build and build some more, he said.

Some Chinese officials have started to muse about the need for slower economic growth, down from the double-digit pace which has been the norm for much of the past decade.

"A slower pace of growth might well be beneficial, because when everything is booming, no one has any incentive to do anything at all carefully," Kroeber said.

BUSINESS ELITE

If Party Secretary Guo was the force behind Gushi's feverish excess, Chen Feng was the man who did the heavy lifting. But while Guo now sits in jail, Chen has catapulted himself into the ranks of Henan's business elite.

Chairman of Xinhe Real Estate, Chen is Gushi's biggest property developer, the man who has built the homes for migrants who have returned with money and middle-class aspirations.

At the centre of Gushi stand three Xinhe developments, modern, sleek, and carefully landscaped. Chen's latest project, Golden Sun, is a 60-building housing estate.

Like most successful real estate barons in China, Chen's government connections run deep. He has been a member of the county parliament and has made Xinhe a virtual handmaiden to official development plans, building 6 sq kms of government offices and public facilities, including schools. Xinhe knows the schools are a big selling point. Each family buying an apartment in Xiangzhang Garden is promised a 20 percent discount on school fees.

Education is one of the yawning gaps between rural and urban China that have made the interior so unappealing -- a place that people aspire to leave.

"It's the pattern across all of the country," said Li Changping, the rural affairs expert. "Officials are concentrating school spending in counties and large towns, so then parents are forced to move to them for the sake of their children."

Like most successful businessmen in China, Chen has been nimble, too. Over the past year, as Gushi tried to change its development strategy after Guo was detained, Chen tried to change Xinhe's focus.

"The company has answered the government's call to build a strong industrialised county, and we have made a strategic shift in the company from a real estate developer into an industrial firm," Xinhe said in a statement in June, marking its investment in a factory for medical infusion bags.

In a sign of its growing stature in official eyes, the company was rechristened this May as Henan Xinhe Construction and Investment Group. The insertion of the province's name came with explicit government approval and will make it easier for the firm to win contracts beyond Gushi.

This potent cocktail of state power, big money and heady urban ambitions can be seen across China, especially in the rural hinterlands.

Henan is one of the poorest major provinces, with just 36 percent of its population living in cities. The province has made rapid expansion of cities a cornerstone of development.

Xinyang, the largest city in southern Henan, has built an 18-storey headquarters for its Communist Party officials overlooking a vast square. City leaders believe the imposing government buildings will attract more investors, the mayor of Xinyang, Guo Ruimin, told Reuters.

The grey expanse of concrete with low shrubs around its edge was not a public square, he said. "It's a botanical garden planted with many flowers."

In Nanyang, a city of over a million residents about two hours drive from Xinyang, multi-storey apartment and office buildings have mushroomed in the new "high-tech" development district.

"These are pretty buildings, but when you're as old as I am, you get dizzy just looking at them," said Xiao Chunqi, gazing at a cluster of four 30-story apartment buildings rising next to her village in Nanyang.

FESTERING DISCONTENT

Chinese law says farmland is collectively owned by villages. In reality, the land is controlled by local governments. They, not the farmers, have the power to decide who can turn fields into real estate. Farmers say land reclamation rules are fixed against them, giving officials and well-connected developers the power to push them off the land without fair compensation.

"The main trouble facing urbanisation is the waste of land, because in China it's just too easy to take farmers' land for a pittance," said Dang Guoying, a rural development expert at the Chinese Academy of Social Sciences who is studying the challenge of urban growth. "So our new cities have these broad roads and big parks, townhouses -- such a waste of land".

These festering discontents could stoke sharper social unrest as urbanisation accelerates, some Chinese researchers have said.

"The path of urbanisation that China has pursued over the past 30 years is no better than the slum development of Latin America and India," wrote Zhou Tianyong, an economic and social researcher at the Central Party School, a leading institute in Beijing. "Moreover, if this path of urbanisation is not adjusted and continues, the outcomes will undoubtedly create much social turmoil," Zhou wrote in a recent overview of urbanisation.

In Gushi, signs of that are not hard to find. Some protesters are demanding political and economic reforms that could challenge the top-down control of the ruling Communist Party. (Click on xxx for related story)

"The land defence movement in Gushi is like a rising wind," said one petition from disgruntled farmers. "Wherever there is oppression, there is also resistance."

Zhou Decai, a veteran protester in Gushi, disclosed plans for a nationwide campaign to link up disgruntled farmers demanding a better deal from the loss of their land. He held out pictures that he said showed battles over land involving dozens, sometimes, hundreds of villagers.

"The reckless development in my area has been slowed, but it's because of farmers' resistance, not because of government orders," Zhou said. The land system needs to be reformed so farmers can decide whether to sell their land -- and reap the benefits themselves, he said.

Yet even the discontented farmers could see no way of stopping a tide of urbanisation from engulfing the countryside. Many of their sons and daughters are moving to factories and apartments, while they stick to the barricades.

"Urbanisation is an inevitable trend. It's not whether you want it or not. There's no choice," said Zhou. "But this urbanisation path is a deformed bubble."

($1=6.776 Yuan) (Editing by Bill Tarrant)
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Old August 17th, 2010, 06:51 AM   #132
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HEARD ON THE STREET: Shades Of Gray In China's Income Levels
11 August 2010
Dow Jones International News

The good news: Chinese people have more money, on average, than most analysts realize.

The bad news: Most of that extra wealth lies with the already-rich, widening income inequality beyond that suggested by official figures. This crowd is often supplementing its earnings with 'gray' income which can include kickbacks, bribes and the like.

These are the conclusions of academic research into China's real income levels by Wang Xiaolu, of the China Reform Foundation, an economic development research group. Happily, the sponsor of the research, Credit Suisse, provides a silver lining: Its analysts have thoughtfully proposed a number of stocks and sectors that could benefit from the fact that China's filthy rich are both filthier, and richer, than they seem at first sight.

Based on a detailed look at spending and income patterns in China in 2008, Wang estimates China's average urban household income is 90% higher than official data. His figures suggest the top 10% of Chinese households are 3.2 times richer than public data shows, while the second decile's income is 2.1 times higher.

Behind this official underestimate of Chinese household wealth lies what Wang terms 'gray' income, such as government and party officials receiving outsize cash gifts when their offspring marry, or benefiting from a bit of insider trading in the property market, or receiving under-the-table payments in return for favorable treatment. Such items contributed to total hidden income in 2008 of nearly $1.4 trillion, equivalent to roughly 30% of China's GDP.

One corollary, that the gap between China's rich and poor is becoming ever wider, is a worrying social problem. Still, not to let corruption and inequality get too much in the way of a good investment story, Credit Suisse's takeaway is that there could be even more latent potential in the Chinese consumer story than investors currently suppose. That's good news for luxury goods providers like LVMH or BMW, for Chinese property developers, and for gambling companies with a big presence in Macau.

Rather than a consumption basket, maybe call this one a corruption basket.

(Andrew Peaple, a Columnist on Dow Jones' Heard on the Street team, has been a financial journalist since 2003. Currently based in Beijing he has also covered the U.K. economy and financial services, and is a U.K.-qualified chartered accountant.)
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Old August 19th, 2010, 05:31 PM   #133
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Some more :

Hidden trillions widen China's wealth gap - report

BEIJING, Aug 12 (Reuters) - China's richest citizens are even wealthier than the statistics suggest, and may hold as much as 9.3 trillion yuan ($1.4 trillion) of hidden assets, according to a Credit Suisse-sponsored study by a top economic think-tank.

Official statistics for 2008 failed to capture income equivalent to about 30 percent of China's gross domestic product, the "Analysing Chinese Grey Income" report found.

And nearly two thirds of that unreported income goes into the pockets of the richest 10 percent, widening China's already troubling wealth gap, said Wang Xiaolu, the economist at the China Society of Economic Reform (CSER), who headed the survey.

The findings may explain in part Beijing's tolerance of recent strikes in manufacturing zones, and official emphasis on ensuring more equitable division of wealth, the report added.

Average per-capital income for the richest 10 percent, at 97,000 yuan, was 65 times of that of the poorest 10 percent, Wang's survey showed -- instead of the 23 times figure given by official National Statistics Bureau's household income survey.

"It means the wealth gap is widening, and the distribution of national income is becoming more and more unfair," it concluded.

A fairer income distribution could ease social tensions and support Beijing's plan to boost domestic consumption.

"One very interesting observation to argue for the highly uneven income distribution in China is reflected in the strong buying power of its richest people," the report said.

China accounted for 3 percent of sales for a brand like Volkswagen and 5 percent for Pepsi, while for luxury retailers like Richemont and Swatch Group, it made up 20 and 28 percent respectively.

"So if income distribution becomes more equitable, it would help boost the consumer market."

ASK YOUR FRIENDS

The team that did the research chose an unusual method to counter a perceived tendency, particularly among high-income families, to lie about the "grey income" that makes up the majority of their earnings.

The survey team contacted only family, friends and colleagues, who would be more likely to tell the truth, trust that data would be kept anonymous and whose answers could more easily be assessed for veracity.

The report suggested actual urban income was around double official levels. The gap between earnings recorded in National Bureau of Statistics Data, and Chinese citizens' real earnings and assets, also grew rapidly from the "middle income group" and up, to become a yawning gulf for the richest.

The grey income comes from sources including stock market manipulation, property deals, vast bonuses from state-owned firms with a monopoly on the market, and even large wedding and other gifts to powerful officials and their relatives.

"Grey money is usually closely connected to the following: corruption, abuse of power, public investment, shares in land development (projects) and other monopoly interests," Wang told the Beijing Evening News.

The report predicted stronger government efforts to rebalance income, because of the negative impact of the yawning gap on both stability and economic growth.

"It is very likely that unlike normal capital return, grey income usually does not help improve competitiveness and efficiency," the report said.

"On the contrary, a large amount of it is likely to come from loss of enterprise and government income or usurpation and plunder of ordinary household income and property. This hampers justice, undermines economic efficiency and becomes a major factor for social conflict and instability." ($1=6.774 Yuan)
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Old October 2nd, 2010, 03:37 PM   #134
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China's urban population set to surpass rural figure
4 July 2010

BEIJING, July 4 (Reuters) - China's urban population is to surpass its rural population for the first time by 2015, with the number of Chinese living in towns and cities set to top 700 million, Xinhua news agency reported.

Li Bin, director of the National Population and Family Planning Commission, said that the world's most populous country is projected to have 1.39 billion citizens by 2015, up from 1.32 billion at the end of 2008, Xinhua quoted her as saying.

The number of people over 60 would pass 200 million, the first boom in the old-age population, she said. An average of 8 million are expected to turn 60 each year, 3.2 million more than the average in 2006-2010.

The population dependency ratio, the proportion of those too young or old to work, would rise for the first time after falling for over 40 years, while the ratio of those aged 15-59 would peak and then slowly fall.
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Old December 15th, 2010, 10:21 AM   #135
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Middle class dream fades for China white collar workers
15 December 2010

SHANGHAI, Dec 15 (Reuters) - Shanghai native Wu Xiaodong has a solid job as a human resource supervisor in a technology company and earns around 4000 yuan ($600) a month. But he is still single at 28 and lives with his parents.

"At this age, things we would be looking at would be marriage and children," he said, adding that he is daunted by the costs of an apartment, a wedding, education for his future children and the price of medical care as his parents age.

A university degree has long been seen as a ticket away from poverty, but China's version of the "middle class dream" is fast fading as graduate job seekers are faced with the stark reality of high living costs, low wages and dim career prospects.

The competition for white collar jobs is heating up as companies in China's top-tier cities such as Shanghai look for talent among an ever-widening pool of more than 6 million graduate job seekers every year.

University education has been a key to China's aim to create a broad urban tier of middle class families with "well-off characteristics" nationwide. The country began expanding university enrollment in 1996 to meet growing personnel demands as China's economy boomed, leading to a surge of graduates.

But signs of economic trouble have put additional financial pressure on companies already struggling with the after effects of the global financial crisis, keeping wages tight.

China's inflation soared past forecasts to a 28-month high in November and showed signs of spreading beyond food prices, putting pressure on the government to tighten monetary policy.

A recent study by a top Chinese labour economist showed that China's university graduates on average earned only 300 yuan ($44) more than a blue collar migrant worker per month, setting off hot debate on the worth of a university education.

"During my father's generation, university education produced the elite," said 24-year-old Zhu Feng, a post-graduate student at a Shanghai job fair.

"But today, university graduates are everywhere, and there are also many people with masters and doctorates. So the worth of a degree is very much devalued."

As a result, thousands of university graduates crowd job fairs in Shanghai at every opportunity, hoping to find a starting point for their white collar career.

Job seekers do quick face-to-face interviews with recruiters before dropping off a resumes from a thick stack.

CITY LIGHTS

Since Chinese cities began booming in the 1990s and the workforce began to favour degree-holders over traditional state-run factory workers, people from poorer parts of China have migrated into cities for an education and then a job.

Top-tier cities such as Beijing, Shanghai, Guangzhou and Shenzhen are now the favoured destinations for graduates.

But reality is biting hard into these dreams as the increasingly high cost of living in these big cities set in.

Rising property prices have been one of the key factors affecting the Chinese middle class, pushing away the chance of owning a home for many young couples.

With China's property sector crucial for the broader economy, authorities have been at pains to balance the needs of economic stability with those of ordinary citizens.

The growing ranks of white collar job seekers is posing a policy challenge for Beijing's Communist Party leaders and some experts have suggest the authorities should divert young professionals into second-tier cities such as Chengdu and Xiamen to take pressure off Beijing and Shanghai.

Cost pressures are a huge concern for out-of-town graduates, who live on the edge of poverty in China's biggest cities.

Known as the "ant tribe", a rising number of these struggling graduates are living in cheap and basic housing in the suburbs and travelling on crowded public transportation for more than an hour to reach their workplaces in the city centre.

22-year-old Li Hanli, a native of central Hunan province, shares a room with two other people at a dorm-like hotel in the city's suburbs.

Her clothes hang from the ceiling of her small windowless room, and internet and power cables line the floor in disarray.

Li has just started work at an internet software company as a sales executive earning 1500 yuan ($225) a month. She and others like her can only afford places like hers, which charge around 500 yuan ($75) a month.

Despite the difficulties, she is undaunted.

"With such a big market, it would definitely bring me more opportunities to develop myself. I also have my own dreams for my career. I believe I can reach the peak of my career in Shanghai."
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Old December 28th, 2010, 06:58 AM   #136
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Cool night shot from NASA for Beijing-Tianjin metropolitan. Can we see one that that the two giant metropolises merge into one?

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Old December 28th, 2010, 01:13 PM   #137
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If they ever joined it would become the worlds biggest city?
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Old December 28th, 2010, 02:28 PM   #138
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When the Chinese will allow the citys to suburbanize, why not?
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Old December 29th, 2010, 06:19 AM   #139
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Quote:
Originally Posted by Chrissib View Post
When the Chinese will allow the citys to suburbanize, why not?
since china choose highrise route,it's not likely developing huge surburb in future.
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Old December 30th, 2010, 04:23 AM   #140
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Quote:
Originally Posted by oliver999 View Post
since china choose highrise route,it's not likely developing huge surburb in future.
When Europe was as developed as China is now GDP-wise (around 1910) it also built lot's of appartement buildings. Now half of the population lives in single-family-housing. Suburbanisation and sprawl usually comes when people can afford cars. When the growth trend continues, this should be the case in 10 years. Then also the average Chinese can afford to have a car. Beijing shows that the Chinese love to buy cars.

But i don't think that China will sprawl like the USA or Australia. The route for the first wave of urbanization is chosen. I think China's cities will develop more like in Europe, with a mixed outcome. At least in the north China has more space for it's cities to sprawl then Taiwan or Korea, which are very mountaneous nations.
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