Chinese eco-cities: A perspective of land-speculation-oriented local entrepreneurialism

Eco-cities in the West: A historical approach

Global industrialization in the 1980s has created unprecedented environmental problems for the whole world. Cities, as engines of the global economy, are in this respect the key players in generating greenhouse gases. Many environmentally conscientious urban planning ideas have been proposed in order to encourage cities to develop sustainability. These ideas were traditionally focused on highly technical analyses and skills in the fields of urban planning, housing, transportation, and land use. In the 1990s, the eco-city concept was further linked to bio-regionalism and resource flow metabolism. Since 2000, eco-cities have been regarded as an innovative and entrepreneurial spatial solution to cope with serious developmental problems along with climate challenges, unemployment, poverty, traffic congestion, meteorological disasters, and environmental catastrophes. ¹⁴

The idea of a garden city, proposed by Howard in 1898, gave rise to the concept of the eco-city. ¹⁵ In the 1980s and the early 1990s, the first generation of eco-cities were built, examples of which include Curitiba (Brazil), Waitakere (New Zealand), and Schwabach (Germany). In the 2000s, eco-cities became a mainstream global trend, particularly in view of the fact that not only were the majority of populations worldwide moving towards urban areas, but also that these communities were beginning to recognize the growing issues surrounding climate change. As a consequence, eco-cities have become even more common. For example, Masdar City (United Arab Emirates) is being developed as the first zero-carbon city in the Middle East, while cities such as Hacienda (Kenya) and St Davids (United Kingdom) are promoted today as the most sustainable and greenest cities in Africa and Europe respectively. ¹⁶

Emergence of Chinese eco-cities

Historically, Chinese cities were ecological by nature, partly because industrial activities were limited and partly because traditional Chinese environmental philosophies and practices such as Daoism and fengshui were influential in settlement planning. ¹⁷ However, soon after the People’s Republic of China was established in 1949, Mao rejected traditional architecture and destroyed old Beijing and other traditional cities and towns in order to construct modern cities. ¹⁸ Most of these cities were modelled after Western cities and did not take environmental concerns into account.

Since 1978, the economic transition in China has been greatly influenced by entrepreneurial city and regional authorities. Urban scholars have described it as ‘Chinese local entrepreneurialism’. ¹⁹ Without Chinese local entrepreneurialism, it is doubtful whether China’s economic development would have become as dynamic as it now is and whether it could have progressed at such a rate. ²⁰ However, behind this Chinese local entrepreneurialism are severe negative externalities such as environmental degradation at the level of the city. According to a World Bank report published in 2006, of the top 20 most severely polluted cities in the world, 16 were found in China. In addition, cities at the prefecture level and above accounted for more than 50 per cent of the total national energy consumption and about 60 per cent of the CO₂ production in China. ²¹

In 2007, the then ministerial-level Environmental Protection Administration of China proposed a list of indicators for the construction of eco-counties, eco-cities, and eco-provinces. ²² At the end of the same year, China proposed the idea of eco-modernization (生态现代化) and eco-civilization (生态文明) as national goals at the 17th National Congress, where then General Secretary of the CCP (and president of China) Hu Jintao expressed the importance of sustainable development as a basic requirement in his new theory on scientific development. ²³ Since then, the eco-city phenomenon has gained popularity. The number of eco-cities rose to more than 230 by the end of 2010. A study by the China City Science Association published in 2011 reported that more than 80 per cent of prefecture-level cities had at least one eco-city project. ²⁴

Some eco-cities are located in central and western China, where economic development is much slower than in eastern China (Figure 1). The distribution of Chinese eco-cities to some extent echoes the spatial pattern of Chinese eco-communities (生态小区), which are often found on the periphery of their provinces, away from the wealthier areas. ²⁵ In addition, most eco-city projects are completely new land developments on the outskirts of large municipalities and are not retro-fitted development plans in downtown areas. ²⁶

OPEN IN VIEWER

Figure 1.

Location of college towns and eco-cities in 2012

A notable new town development, Dongtan, located on the alluvial island of Chongming which is part of the municipality of Shanghai at the mouth of the Yangtze River, claims to be the first planned eco-city not only in China but also in the rest of the world. Tianjin City also cooperated with the Singaporean government in the Sino-Singapore Tianjin Eco-City (SSTEC) project. In addition, Huangbaiyu, a mountain village in Liaoning Province, was designed as a model village for the China-US Center for Sustainable Development. ²⁷

In terms of retro-fitted development, it is worth our while to examine the case of Rizhao. A great majority of households in this area have been equipped with photovoltaic cells, solar water-heating systems, and solar cookers. Due to its performance in sustainable development, Rizhao won China’s National Model City for Environmental Protection in 2005, the World Clean Energy Award in Policy and Lawmaking in 2009, and a United Nations Habitat Award in Urban Planning in 2009.

These are recent projects, and only time will tell whether they will be fully implemented and what kind of impact they will have. Although several of these projects have already received high praise for their efforts in reducing CO₂ emissions, most of the new-town-style land development projects have also been criticized for their high-carbon costs. For example, without considering concrete carbon control designs such as green transportation (walkable and cyclable distances) for new ecological ways of life, these new eco-cities at the periphery of municipalities are likely to introduce large highways and grand boulevards to cater to the auto industry and local consumers for whom cars are a symbol of the middle class to which they aspire. ²⁸

Upward accountability and state landownership as unique Chinese features

There are at least two major differences between eco-cities in the West and those in China. The first is the political accountability of local leaders who promote eco-cities. In the West, in order to win elections under the liberal democratic system, local politicians must consider environmental sustainability in areas where there is a strong environmental awareness among local communities. Political accountability for eco-cities tends to involve a grass-roots relationship in which local citizens have a certain amount of leverage over political decision-makers because of their voting rights. However, China operates under the authoritarian control of the CCP. Local leaders, who continue to enjoy great decentralization of power since 1978, are still not elected locally as they are nominated and assigned by upper-level CCP cadres. Under the CCP’s performance-oriented personnel management system, those who have accomplished targets set by economic indicators, such as gross domestic product (GDP), the attraction of foreign direct investment (FDI), and the creation of fiscal revenue, are likely to have more chances of promotion. Recently, some social indicators, such as the number of petitions, and environmental ones, such as CO₂ reduction, have been included as core indicators for rating local leaders. ²⁹ In other words, Chinese local leaders promote eco-cities not because of pressure from civil society but in order to meet the criteria stipulated by development indicators set by upper-level governments.

The second difference between the West and China is the land–state relationship. Unlike capital and labour, land is not mobile and remains controlled by the state for economic development. Therefore, land expropriation and appreciation of land prices through the resale of land are the most secure methods of original capital accumulation in many developing and less-developed countries. ³⁰

In developed liberal countries, private lands are protected by law, and the state may not accumulate capital through appropriating and selling private lands. However, in the case of China, all privately owned lands were confiscated by the state when the CCP took over the country in 1949. Today, all urban lands are state-owned, while rural lands are collectively owned and subject to the supervision of the immediate higher-level city authorities. Limited, if not absent, active civil society and independent media are unable to oppose land appropriation by the local CCP authorities. In sum, the state in post-socialist China has become the most powerful agent in the utilization of land for capital mobilization ³¹ and accumulation, by dispossession if necessary. ³²

The two major institutional differences mentioned in the preceding largely explain why eco-cities in the West focus on retro-fit programmes in old towns or small-scale urban development projects, while their Chinese counterparts pay more attention to the development of large-scale new towns. A macro perspective to comprehend the dynamics between local and central authorities over land management power is necessary for a better understanding of the general mechanisms and effectiveness of new-town-style eco-cities in China. Instead of using a micro perspective to see why an individual project succeeds or fails in technical terms, ³³ I propose an examination of the political economy of post-Mao spatial development and transformation from both historical and institutional dimensions. It is thus important to analyse the existing literature on China’s central–local interaction, urbanization, and land management concerning eco-cities. In addition, interviews with planning professionals and practitioners were conducted in order to collect primary information in several Chinese cities between 2010 and 2012. By doing so, mechanisms of land-speculation-oriented local entrepreneurialism could be better understood.

Explosive spatial transformation

Over the past few decades, Chinese local governments have skilfully utilized their decentralized power to convert farmlands into various kinds of industrial and commercial developments. ³⁴ Between 1978 and 1996, 4.2 per cent of the country’s cultivated land was converted into land for urban construction. A great portion of the lost cultivated land was reportedly a consequence of industrial and urban expansion in the context of local entrepreneurialism. ³⁵ These explosive booms of land-related development are termed as enclosure movement (圈地运动). It must be noted that not only are spatial transformation and land development in China conducted by the local authorities but also that they are a result of strategic interaction between the central and local authorities. I will elaborate on the contestation of land management power between decentralization and recentralization and then discuss inter-scalar land strategies behind the construction of eco-cities in China.

Scalar politics of land management

In the late 1980s, China’s Constitution was amended to legally allow lands to be leased by the state to the private sector for fixed periods of time. ³⁶ However, because the law-making process was too controversial at the time, ³⁷ many important details, such as which administrative levels were empowered to represent the state to lease lands and legitimately exercise ownership rights and profit from land rent, were not clearly defined. This unique land leasing system offers political space to both central and local governments for land management. ³⁸

The central government’s land policy is highly related to concerns over food security and self-sufficiency, for example, food as a key principle (以粮为纲) in the 1980s, and dynamic balance between farmlands and cultivated lands (耕地总量动态平衡) in the 1990s. Any farmland lost to industrial and commercial purposes was to be offset by conversion or reclamation of other lands for agricultural use.

From the perspective of local governments, after tax and ownership reforms in the early 1990s, local governments faced tighter budget constraints than before and therefore were forced to seek new ways to generate income in the form of extra-budgetary income. An amendment to the Constitution permitted the establishment of the land lease market under the exclusive supervision of local governments, which motivated local officials to convert rural land for urban use in order to finance the provision of infrastructure. ³⁹ At the national level, land-related revenue grew from less than 10 per cent of total local budgets in 1999 to 55 per cent in the late 2000s. Land conveyance fees accounted for as much as 80 to 100 per cent of the funds needed to finance urban infrastructure. In Guangdong, the share of income from land conveyance in the local extra-budgetary revenue was about 30 per cent at the provincial level and as high as 87 per cent at the prefecture and county levels. ⁴⁰

To conclude, land in post-Mao China is essentially both a territorialized and decentralized asset managed by local entrepreneurial governance and a de-territorialized and recentralized asset controlled by the centre. ⁴¹ Land politics in China are intertwined with power struggles and contestation between local and central governments. This perspective of central–local strategic interaction will be employed to further analyse spatial transformation of new-town-style eco-cities in China.

Inter-scalar land strategies behind eco-cities in China

The most influential land policy in relation to environmental protection is the ‘1.8 billion mu farmland threshold’ (十八亿亩红线) stipulated in 2005. ⁴² The policy requires all local governments at different levels to collectively ensure a minimum of 1.8 billion mu of farmland at the national level. In order to achieve this goal, the central government divided the total area into smaller units, and farmland protection performance indicators were assigned to local leaders at each administrative level. It was expected that the central policy of assigning a total ceiling on the land conversion quota to local authorities would counteract the local practice described as illegally breaking the whole into parts (化整为零). According to central land regulations, any development project exceeding 1 km² is to be submitted to the central government for review. However, local governments were often found expanding their authority to approve by dividing large land parcels into smaller ones. ⁴³

The farmland preservation policy operates under the context of upward accountability, which means that those who fail to meet the target will be automatically demoted. Achieving the target is crucial to the careers of local cadres. ⁴⁴ It must be noted that this is the first time that a land conversion quota has been directly linked to the management of personnel of the Party-state. Local entrepreneurial authorities looking to further their career needed more innovative land policies to cope with the compulsory land requirements from above.

This is one of the reasons why the Dongtan Eco-City project could not be implemented even after the British consultancy firm Arup and the Shanghai City Investment Corporation finalized the planning. Despite a plan to keep Dongtan’s carbon footprint to 2.2 hectares per head, which is less than a third of the average Shanghai resident’s footprint, the project still failed due to the lack of available conversion quota in Shanghai. Dongtan was originally preserved by the Shanghai city government as the very last farmland area in order to fulfil the requirement of rural land conservation. Without any alternatives to exchange for the default quota, the Shanghai city government was unable to implement the Dongtan project, which involved the conversion of rural land into land for urban construction. Another reason why the Dongtan project was stopped was that Chen Liangyu, the mayor of Shanghai at the time, was imprisoned for corruption. Lacking both land for the conversion quota and political support from the top, the project was eventually deemed a failure. ⁴⁵

From this perspective, it is clear why Tianjin proposed its SSTEC project on non-arable land and deserted salt pans located far from the Tianjin downtown area. The location of deserted marginal lands is certainly part of the local knowledge. The selection of 30 km² of marginal land can be seen as a response to the overall land shortage in Tianjin whose city government also faced great pressure in meeting the land conversion quota. The site selected for the SSTEC project not only reinforced Tianjin’s ecological concerns (transforming marginal and unproductive lands into an eco-city) but also supported the national priority of farmland preservation. ⁴⁶ By the same token, the eco-city of Caofeidian is also located in salt pan areas. ⁴⁷

Another example is the compulsory tender, a public auction system (土地招拍挂) implemented by the Ministry of Land and Resources to control and manage commercial land projects which were mismanaged by local officials. Several locally initiated strategies had to be created in order to counter central policies. Using Kunming as an example, one solution was to build an eco-city in the wider context of the college town, where education facilities are regarded as a domain of public interest. The land lease market in college towns, as a consequence, is not required to follow the regulation of compulsory public auctions. ⁴⁸

To sum up, through the ‘interactive’ lens that views local–central land relations in dynamic and behavioural terms, it is clear that both central and local governments have the resources to institutionally influence and constrain each other. ⁴⁹ Eco-cities in China, therefore, involve continuous strategic interaction between central control and local flexibility or even disobedience. Although the central state has nominal ownership rights over land across the whole country, local states still have local knowledge and immediate access to lands located in their jurisdiction. Due to its immobility and physical attachment to territories, land belongs to the local states. Therefore, local states can consolidate and actualize their territorial power over land development projects more easily than the central state can, as evidenced by the fact that most local leaders in China today share the view that land under their jurisdiction is their personal proprietorship. ⁵⁰ The central governments is in a relatively weak position to stop such land speculation and related negative externalities initiated by local entrepreneurial officials.

Isomorphic local development: Zone fever and college town fever

The concept of development zones was first adopted in Shenzhen soon after China opened up its economy to globalization. Due to the success of the Shenzhen Special Economic Zone that attracted huge amounts of foreign direct investment (FDI) and generated much trade, many entrepreneurial local authorities also began constructing their own development zones without the endorsement of upper-level governments. Statistically, the 54 national-level development zones endorsed by the State Council received US$19.5 billion of FDI, which accounted for a total value of trade amounting to US$385.5 billion, comprising 20 per cent and 15 per cent, respectively, of China’s national total in 2008. ⁵¹ However, the failed zone projects incurred many negative externalities, such as overinvestment and overproduction in relation to industrial isomorphism, limited technological innovation, and low-level environmental sustainability. ⁵²

The rise of college towns is related to a challenge China faced in the 1980s when gains in added value from the globalization process were limited. In 1991, Jiang Zemin, then the president of China, gave a speech about the rise of the knowledge economy at the centennial celebration of Peking University. The central government further proposed a policy of ‘revitalizing the nation through science and education’ (科教兴国) in the 10th Five-Year National Development Plan at the end of the 1990s. The first prototype of the college town in China was built in Shenzhen. The city government proposed the ‘knowledge turn’ and established the Shenzhen Research Institute of Tsinghua University (SRITU), which was jointly sponsored by the Shenzhen city government and Tsinghua University, which invested RMB 60 million and RMB 20 million respectively. The SRITU ultimately became a college town.

In 1998, the Ministry of Education of China announced that the national ratio of people obtaining higher-education degrees would be raised to 15 per cent by 2010. Therefore, many Chinese local governments started to build so-called college towns. An incomplete survey in 2012 identified more than 60 college town projects, most of which were established in the first half of the 2000s. About 60 per cent of these projects are distributed in eastern China. The top five provinces, in terms of number of college towns, are Jiangsu (12), Shandong (7), Shanghai (5), Guangdong (5), and Zhejiang (5). It should be noted that all five provinces are located in eastern China (see Figure 1).

It cannot be denied that a few college towns, such as the Guangzhou College Town project, are en route to becoming clusters of higher education institutions that will subsequently bring further technology and innovation to the local economy. However, many, if not most, college towns are only duplicates of the education infrastructure. Many of these college town projects have been designed without any consideration as to whether the planned size of the campus and number of students can be achieved. These colossal college town projects were proposed by local governments competing with one another in their attempts to demonstrate their support for the central government’s policy of revitalizing the nation through science and education.

Like eco-cities, development zones and college towns are generally land-speculation-oriented and new-town-style projects. For example, the planned area of these development zones is 38,000 km², which is larger than the 29,000 km² of urban built-up areas at the end of the 1990s. Similarly, college towns are huge in size. The planned area of the Xianling College Town project, located in Nanjing city, Jiangsu Province, is 70 km², or 26 times the size of the Peking University campus. The average area of campus per student is as high as 62 m², which is even higher than the official standard set by the Ministry of Education. ⁵³ Moreover, some cities, such as Changsha, Rizhao, Wuxi, Suzhou, Langfang, and Dongguan, are proposing to be both eco-cities and college towns or eco-college towns.

These large-scale land projects known by different names together present a unique development phenomenon whereby land is regarded as a source of extra revenue for local authorities and universities. In the case of the Chongqing Jiangnan College Town project, land designated for education was re-zoned as commercial land for housing and commerce. In this case, farmers were paid RMB 20,000 per mu. Chongqing University then leased the land to Jiangnan, the land developer in charge of the Chongqing project, at a price of RMB 400,000 per mu. For that purchase, Chongqing University netted a startling RMB 380,000 per mu. ⁵⁴ In addition, Jiangnan used the land for commercial developments, housing, resorts, hotels, offices, and so on, thereby earning further profit. College towns are not simply towns with universities, but are new cities that accommodate a whole range of commercial development. In the case of the Langfang College Town project, land was taken at only one-sixth of the current market rate from farmers and then sold to entrepreneurs to build five 18-hole standard golf courses in just the first phase of land development. ⁵⁵

In order to obtain a better understanding of the enthusiasm for the development zone, college town, and eco-city projects, the role of land-speculation-oriented local entrepreneurialism should be considered. Land entrepreneurialism involves the utilization of land development projects by the local authorities to respond to various global contexts and domestic situations. For example, in the case of development zones, China had just instituted liberalization reforms in order to meet the demands of economic globalization. In the case of college towns, China looked for value-added solutions to address the knowledge economy. With regard to eco-cities, China’s aim is to build new development projects to meet climate change challenges as well as to create a new space for a green economy.

Local entrepreneurialism has skilfully promoted land development projects that reflect central discourses prevailing at the time; for instance, development zones for attracting FDI, college towns for revitalizing the nation through science and education, and eco-cities for ecological civilization. By exploiting these opportunities, these land development projects have also become powerful images to boost urban competitiveness in order to attract more investment and generate greater GDP. In other words, discourses and strategies of spatial practices are commonly seen as a way to ‘camouflage’ Chinese local entrepreneurialism, which tries to legitimize its behaviour in terms of a timely response to globalization. ⁵⁶

In spite of the discourses and strategies already discussed, the driving forces of city developments are still land-related local interests. This land-speculation-oriented local entrepreneurialism will be discussed according to two dimensions: institutional mechanisms and negative externalities.

Institutional mechanisms of Chinese local entrepreneurialism

Chinese land-speculation-oriented local entrepreneurialism is facilitated by various kinds of urban construction and development investment corporations that are in general fully sponsored and supervised by local governments. The Shanghai Industrial Investment (Holding) Co. Ltd., a key Shanghai firm for land development in the Dongtan Eco-City project, is a state-owned enterprise fully funded by the Shanghai city government. Similarly, Songjiang College Town is managed by Songjiang College Town Development Corporation, which is fully sponsored by the Songjiang district government. The SSTEC is being developed by the SSTEC Investment and Development Company, which is a jointly invested land development corporation between the Singaporean and Chinese governments. ⁵⁷ Due to ambiguous public ownership in the form of private corporations, these land companies with intimate relationships with the local authorities have become the key organizations in charge of land development in these new towns. ⁵⁸

Local entrepreneurialism has skilfully utilized the political space created by the fragmented Chinese authoritarian system, and it has taken advantage of conflicts within various ministries and departments at both central and local levels of government. ⁵⁹ For instance, the sale of land originally designated for educational purposes was opposed by the Ministry of Land and Resources but ironically was supported by the Ministry of Education. From the Education Minister’s point of view, selling land targeted for education facilities is a useful way of generating more capital gains to pay the debts of schools. ⁶⁰ This shows that Chinese local entrepreneurism tacitly takes advantage of fragmented authoritarianism to fulfil its goals of local development and land finance.

Similarly, five national programmes related to broadly defined eco-cities are promoted by various ministries which provide various financial resources and performance indicators to motivate as well as evaluate local governments participating in those programmes. ⁶¹ However, due to fragmented authoritarian control, unfortunately some performance indicators assigned by different ministries contradict each other. For example, integration between rural and urban areas could reduce biodiversity. ⁶² While local governments utilize the political space to secure more resources from the central government, they also contribute to the proliferation of development projects that are incompatible with urban sustainability.

Negative externalities of local land speculation

There are four negative consequences of land finance in relation to real estate development. The first is that the commodification of housing and real estate in the post-Mao period has created a new market for luxury housing, which means that developers are more likely to make higher profits on luxury properties. College towns and eco-cities, which operated with a logic resembling that of real estate development, have led to more land speculation for the rich, at the expense of public interests such as education and sustainability. ⁶³ For example, it was reported that the Chenggong Eco-City project in Kunming would be a so-called HOPSCA, a complex including hotels, offices, parking lots, shopping malls, convention centres, and apartments. Given that Kunming is relatively less developed, the target group of customers of the Chenggong HOPSCA project is obviously not ordinary local citizens but foreigners belonging to high society and the new rich. ⁶⁴

The second negative externality, forced displacement, is caused by developments in the real estate industry, which create social discontent among the local citizens. In the case of the Guangzhou College Town project, those who relocated to the site in the early 1990s and received official permits to give up their land use rights are still seriously displaced. Appropriate legal procedures have not been followed, nor have the displaced received adequate compensation. ⁶⁵ Third, there is a trend of demolition and relocation of government buildings and universities to make way for new town projects. For example, the new Kunming City Hall was relocated to Chenggong to make room for the development of Chenggong College Town. But the previous Kunming City Hall in downtown Kunming was constructed less than two decades ago. Even worse, Yunnan University was forced to move to the outskirts of Kunming in Yangpu in the early 2000s, and it has to move from its newly built Yangpu campus in Chenggong yet again to ensure the success of the new college town. The same fate has befallen other universities in Kunming, for example, Yunnan Nationalities University. These still-useful government buildings and university facilities were quickly abandoned and even demolished for other property companies. ⁶⁶

Fourth, concomitant with the construction of college towns is the phenomenon of rising social inequality. ⁶⁷ Some migrant workers, often minorities with the lowest social standing, who worked in college town and eco-city construction projects have not been paid for their labour. For example, a real estate company in charge of the Langfang project amassed a debt of RMB 2.2 billion in construction fees by early 2004. Of that debt, about RMB 1 billion was owed to migrant workers. The Langfang project even received a commendation from Jiang Zemin, then the president of China. ⁶⁸ Ironically, the endorsement from the head of state enhanced the real estate company’s image but did not help migrant workers recover what they were owed.