Leveraging land values for rural development in China after the Sichuan earthquake

Abstract

Since the late 1990s, rural residential land consolidation projects have propelled a wave of rural restructuring across China. Characterized by the creation of concentrated villages, land consolidation is seen as a means of both improving land-use efficiency and promoting rural development. But residential concentration is often funded through the commodification of rural land – a trend that became particularly clear in rural Chengdu after the Wenchuan earthquake. This article explores the implications of land-based rural reconstruction in Chengdu. Drawing on a comparison of three adjacent communities in peri-urban Chengdu, the article argues that the tactics adopted by local leaders in their efforts to generate funds through land consolidation can best be characterized as a process of leveraging rural land values. This leveraging entails not only a risk of failure, but also a diversion of public funds towards projects that enhance the attractiveness of land to urban investors, a removal of control over land from the hands of rural residents, and a deepening of inequalities across communities.

Keywords

Chengdu urbanization property rights reform post-quake reconstruction land-financed rural reconstruction rural residential land consolidation rural development

On 12 May 2008 southwest China was struck by an 8.0 magnitude earthquake – the Wenchuan earthquake – that left over 69,000 people dead and destroyed millions of homes.¹ The quake’s epicentre was less than 100 km north of Chengdu, the rapidly developing capital of Sichuan Province. Chengdu has a morphology that is characteristic of many large Chinese cities: it encompasses not only the built-up urban core, but also large swathes of rural land as well as surrounding satellite cities. The metropolitan region of Chengdu had a population of 11.1 million in 2007, with less than half (about five million) of those residents living in the urban core.² While the central core suffered limited damage during the quake, Chengdu’s northern rural fringe was badly hit.³ The Chengdu government used post-quake reconstruction as an opportunity to accelerate regional urbanization, relocating quake-affected rural residents in planned, concentrated settlements.⁴

Concentrated villages are not unique to Chengdu. Indeed, they are probably the most widespread form of rural spatial restructuring in contemporary China.⁵ Rural residential land consolidation (农村居民点用地整理) projects involve moving villagers out of scattered houses into more concentrated communities – a process also referred to as ‘elevating’ villagers into high-rise apartments.⁶ Consolidation projects were initially conceived of as a means of addressing the land-use inefficiencies created by rural outmigration, which left many buildings unoccupied.⁷ But the construction of concentrated villages soon became associated with rural developmental projects under the ‘Building a new socialist countryside’ campaign introduced in 2006.⁸ Many local officials interpreted the broad socio-economic goals of building a new socialist countryside rather literally as a project of building modern rural settlements.⁹ In theory, these new settlements can be at least partly self-funded by generating revenue from the land that is freed up through residential concentration. But this requires creating markets for rural property rights – an issue that has long been debated among Chinese intellectuals and policymakers. In the wake of the Wenchuan earthquake, peri-urban Chengdu became a key site of experimentation for this mode of rural development.

This article traces the genesis of the Chengdu approach to land-financed rural reconstruction, and highlights the implications of this approach for three communities in peri-urban Chengdu. The case study sites are three adjacent communities in Longmenshan Town, chosen because of the wide institutional variation across the communities. This selection was intended to test an initial hypothesis that village-level institutional histories would play a determining role in shaping post-quake reconstruction outcomes. More specifically, I expected that active collective institutions would translate into greater resident participation in the reconstruction process. But while institutional histories did influence reconstruction outcomes, it was not through the mechanism of residents’ participation in decision-making, which was similarly limited in all three sites. In the context of Chengdu’s policy of leveraging rural land values for rural development, different institutional histories meant that leaders in some communities were better positioned to play a city-centric land value game.

I argue that the tactics adopted by local leaders in their efforts to consolidate land in these communities can best be characterized as leveraging rural land values. Here I use the term ‘leverage’ in its financial sense of using borrowed capital to increase the potential return on an investment. Local leaders bet on the future value of land to attract funds from investors, focusing their efforts on the game of creating and capturing land value. In metropolitan regions, leveraging land values often means tying rural futures to speculative urban real estate and tourism markets. This removes control of land from the hands of rural residents and places it in the hands of ‘outside experts’ (外来的高手) who are ostensibly better positioned to capitalize on those markets. It also leads to a shift in local spending towards projects that can attract outside investment. Finally, leveraging land values for development can exacerbate inequality across rural settlements, particularly when speculative projects fail to materialize.

The article is based on participant observation fieldwork carried out while volunteering at a non-governmental organization (NGO)-run community centre in temporary post-quake shelters, as well as 88 semi-structured interviews conducted with residents, grass-roots community leaders, NGO workers, government officials, and planners and consultants involved in reconstruction in Longmenshan and throughout the Chengdu region. Interviews were conducted in Mandarin using a snowball sampling method. In Longmenshan, I conducted interviews with the help of a research assistant – a Chinese social worker who lived permanently in the town and was well known to residents. I made monthly visits (ranging from two days to one week) to the site from late 2009 through late 2011, while living in central Chengdu. I revisited the area in 2016, and again in 2018. I also rely on policy and promotional materials published by the township and village governments, the local gazetteer published in 2005, and newspaper reports.

Chengdu’s rural property rights reforms: Unleashing ‘silent capital’

Chengdu’s experiment in land-financed rural reconstruction took place against the backdrop of a long-standing debate about rural property rights reforms in China. Constitutionally, most rural land in China is owned by the rural collectives. Urban land, by contrast, is owned by the state. In 1988 the Constitution was amended to permit a separation between ownership rights and use rights to land, initiating the development of a lease market for urban land.¹⁰ No such market emerged for rural land: use rights to rural land are allocated to collective members for agricultural and residential purposes, but it is much more difficult to lease use rights outside the collective, particularly for non-agricultural purposes. Moreover, it is often unclear which organization represents the rural collective. Peter Ho has argued that the apparent ambiguity around who owns land in rural China is deliberate, and it gives the government leeway to react to changing social conditions.¹¹ By contrast, liberal economists inside and outside of China have blamed economic stagnation in rural areas on farmers’ inability to sell land or use it as collateral for loans. Following the by-now canonical arguments laid out by Hernando de Soto, liberal economists suggest that clarifying property rights will increase farmers’ willingness to make long-term investments in the land, improve agricultural efficiency, and allow land to be transferred to higher-value uses.¹²

On the other side of the debate is the group of Marxist rural sociologists associated with the New Rural Reconstruction movement, most notably Wen Tiejun. This group claims that the commodification of rural land would have a disastrous effect on both rural residents and the nation as a whole. According to Wen, collective property rights should be strengthened (rather than weakened through the individualization and commodification of land rights) because they act as a form of ‘social protection’. In times of economic crisis, rural migrants can always return to their land, which provides both an individual safety net and a social pressure valve.¹³ The debate can, in some sense, be characterized as one between ‘growth and efficiency’ on the one hand and ‘stability and welfare’ on the other, with both sides claiming to have the best interests of farmers in mind. For their part, leaders in the central government appear to be wary of the wholesale commodification of rural land, although they have allowed a number of localized experiments with rural land rights transfers to take place.

It is in this context that the Chengdu government initiated a series of rural land reforms under the rubric of urban–rural integration, which is a broad policy framework that aims to coordinate urban and rural development throughout China’s metropolitan regions. It is, on the one hand, concerned with managing urban development by unifying the metropolitan region under a single land-use plan. On the other hand, urban–rural integration is also aimed at extending urban living standards to rural areas, based on the assumption that integration into urban markets and administration is the best means of developing rural areas.¹⁴ Moreover, Chengdu’s urban–rural integration was also pitched as part of a far broader project to address urban–rural inequality – the central government’s new socialist countryside project. As such it included specific targets for closing the gap between urban and rural incomes and public services; modernizing agriculture; improving rural infrastructure and the rural built environment; extending access to high-quality education and health care to rural areas; and enhancing community autonomy and self-management.¹⁵

Chengdu’s property rights reforms were thus justified in terms of providing funds for promoting rural development and improving rural social welfare systems. A journalist from the Southern Weekly (南方周末) reported:

The biggest dilemma was the lack of money…. At the time, the city government calculated that if half of Chengdu’s six million rural residents became urban citizens, this would require a total investment of about RMB 600 billion. In 2007, Chengdu’s fiscal revenue, even under the best conditions, was not more than RMB 70 billion.

At the time, rural land, especially rural construction land, had become a sort of massive ‘silent capital’ because of the existing land policies. How to allow this silent capital to be transferred, to be traded, to attain the same huge values as urban construction land – this was the focus of discussion.¹⁶

In early 2008, prior to the quake, the Chengdu Party Committee issued a Number 1 policy document entitled ‘Opinions on strengthening arable land protection and promoting the reform of the rural land and housing rights system (trial implementation)’. The document laid out the goal of ‘establishing a sound modern rural property rights system with clear ownership, clear rights and responsibilities, strict protection, and smooth circulation [of property rights]’, taking ‘market orientation as the guiding principle, and peasant empowerment and autonomy as the core’.¹⁷ Specifically, the document advocated the circulation of contract land management rights, use rights to rural construction land, and use rights to rural housing. But because the reform of the rural property rights system was still considered a sensitive issue, the Number 1 document was not issued publicly and was only issued to county-level standing committees.¹⁸ It was not until after the quake struck in May 2008 that village-level experiments in assigning and transferring property rights were expanded throughout the Chengdu metropolitan region.¹⁹

Another way that rural property rights were partially commodified in Chengdu was under the ‘increasing vs. decreasing land balance’ system (增减挂钩). As part of the national arable land protection policy, the central government requires each jurisdiction in the country to maintain a fixed proportion of arable land – known as the so-called ‘red line’. The increasing vs. decreasing balance system operates like a carbon trading scheme by allowing localities to trade rights to develop land. Areas with more arable land (often generated through residential land consolidation projects) can sell their construction land quotas to other towns or villages, initially only within the same county, where the pressure for urbanization is higher, leaving the overall amount of arable land within the wider jurisdiction unchanged.²⁰

In 2007, Chengdu and the nearby city of Chongqing became pioneering sites for ‘land bill’ (地票) markets, when the two cities were designated ‘pilot zones for the national reform of comprehensive urban–rural coordination’ (全国统筹城乡综合配套改革试验区). This allowed Chengdu and Chongqing to create land bill markets that covered their respective metropolitan regions rather than merely a single county, the jurisdictional limit that was set in other parts of China. In Chongqing, rural households could participate directly in specially established markets for trading land quotas, allowing farmers to capture some of the appreciation in land values that occurs with urban development.²¹ In Chengdu, the municipal government took a more hands-on approach by: (1) setting high prices for land quotas, and (2) requiring high standards of public goods provisioning in new rural settlements. Qian Forrest Zhang and Jianling Wu claim that this state-led approach has translated into an improvement in living standards across rural Chengdu, and represents a form of ‘land commodification without dispossession’.²²

But the land bill markets are not only about improving rural living standards: they also facilitate growth around the urban core by opening up new sources of developable land.²³ This mixed logic is also evident in Chengdu’s reforms to the hukou system, the national household registration system that assigns each individual a place of residence and an agricultural or non-agricultural status. The hukou system has been blamed for entrenching urban–rural inequalities by keeping entitlements to urban welfare benefits out of the reach of rural migrants.²⁴ Chengdu has been at the forefront of hukou reforms since the early 2000s, progressively making it easier for rural residents to obtain urban hukou and thus access the public goods associated with urban citizenship. But Shaohua Zhan argues that Chengdu’s hukou reforms are motivated at least partly by the need for both urban and agrarian capital to amass bundles of investible land.²⁵ Reducing the requirements for obtaining an urban hukou makes it easier for rural residents to move to the city. This ‘carrot’, paired with the ‘stick’ of local governments’ sometimes coercive land consolidation practices, encourages rural outmigration and facilitates land-based modes of accumulation. A key question, then, is whether the Chengdu government’s experiments with rural property rights and hukou reform mark a renewed commitment to distributive justice, or are merely justifications for a large-scale land grab.

Chengdu’s experiments with rural property rights reform sparked a heated debate, with a dividing line between economic liberals and rural sociologists. Two key protagonists were Zhou Qiren, an economist, and He Xuefeng, a rural sociologist. In 2008 Zhou led a research team from Peking University to investigate Chengdu’s land reforms. In 2010 they published a report entitled, ‘Restoring rights and bestowing capabilities: An investigative study on Chengdu’s exploration of land system reforms’ (还权赋能 – 成都土地制度改革探索的调查研究). The title itself, drawn from Chengdu’s own slogan for its rural property reforms, is indicative of the authors’ liberal economic stance: secure, individual land rights give farmers the ‘capability’ to participate in the market and directly benefit from the value of land. But according to Zhou, Chengdu’s land rights system does not just benefit farmers: through the magic of the market, it generates value for society as a whole. Zhou and his colleagues explain this value creation as being fundamentally linked to the right to transfer property rights, rather than merely use property:

Property rights to capital only provide the possibility for increasing income; they do not guarantee that higher production income will result. This is because although resource owners may be willing, they may not be able. If they use their own capital to engage in production, in terms of technological or economic efficiency this may not be as effective as passing resource rights over to an outside expert…. Looked at in this light, although the use rights to resources and capital are important, the ability to transfer [emphasis added] these rights is even more important, because it is only the latter that increases the specialization and division of labour and sustains the widespread increase in income under this system.²⁶

Based on this logic, Zhou and his colleagues claim that ‘bestowing capabilities’ is more important than ‘returning rights’. The ‘capabilities’ in the title of the report is thus used in a very restricted sense to refer to the capability to transfer use rights to an outside expert who will put rural resources to higher-value uses.

Unsurprisingly, He Xuefeng produces a rather different assessment of the Chengdu experiment. At the end of 2010, He published a book entitled The Logic of Land Rights: Whither China’s Rural Land System? (地权的逻辑: 中国农村土地制度向何处去). One chapter of the book criticizes Chengdu’s reforms, claiming that Chengdu’s land reform model is not transferrable to other areas, and may not be sustainable in the long run.²⁷ He characterizes officials as suffering from ‘utopian’ thinking, and suggests that farmers, once given the capability to sell their land, will lose both land and livelihood security. When He’s critique was brought to his attention, Zhou wrote a scathing editorial piece in which he claims that He’s analysis adopts a ‘lifeless logic’ to understand market dynamics.²⁸ Zhou argues that not all farmers are interested in selling their land, and as prices change according to supply and demand, they themselves can decide whether or not it is profitable to sell their land. He Xuefeng responded to these charges in the unambiguously titled piece, ‘Why Zhou Qiren’s views on land rights are wrong’ (周其仁的地权观点为什么是错的). He insists that in the short term, laws of supply and demand dominate when it comes to determining rural land prices in Chengdu, and the government’s rapid creation of a new supply of commercially available rural land must necessarily result in lower prices.²⁹ Moreover, He also points out that land differs from other commodities in being immovable. Land with locational advantages, such as easily accessible suburban areas of Chengdu, will be able to command a high price. But the majority of rural land will not be able to command such a high price, resulting in increasing inequality across rural settlements.³⁰

At the basis of both assessments is the question of how rural land is valued in the market. What He’s and Zhou’s analyses overlook is the inherent uncertainty of land values in Chengdu’s still underdeveloped rural property rights markets (outside of Chengdu’s highly regulated land bill market). In the wake of the quake, there was no flood of urban capital waiting to sweep through Chengdu’s peri-urban areas. Instead, local officials expended a great deal of energy brokering deals with private- and public-sector actors, assembling packages of land (few investors would be interested in the small plots of land to which individual households hold titles in rural Chengdu), and otherwise enhancing the attractiveness of property in their jurisdictions. The following section takes a more empirically grounded look at Chengdu’s approach to land-financed rural reconstruction, and traces the longer-term implications of a land-based approach to rural development.

Leveraging land values in Longmenshan Town

Longmenshan Town consists of a group of six communities located about 70 km north of urban Chengdu, where the flat, fertile Sichuan Basin gives way to the Longmenshan Mountain Range. In 2005 Longmenshan was home to over 12,700 people, about three-quarters of whom were engaged in agriculture.³¹ Mining was the economic mainstay of the community from the 1960s until 2002, when the two large state-owned mines were shut down. Since that time the Longmenshan government has focused on promoting the area as a tourist destination. By 2005, local residents had opened about 800 rural homestays to receive tourists who arrived to visit two well-known gorges in the area.³² The 2008 earthquake resulted in the deaths of 455 residents, and destroyed over 95 per cent of the houses.³³ The mountainous terrain meant that the ability to convert former homestead land to arable land (and participate in Chengdu’s land bill markets) was limited. Accordingly, settlements in Longmenshan Town turned to in situ investment opportunities to generate funds for rural reconstruction.

Baishuihe Community

The area where Baishuihe Community is located acts as the social and spatial heart of Longmenshan. The settlement formally became a ‘community’ in 2002, after nearby state-owned mines were shut down. This meant that residents lost their registered status as state workers and became official residents of the newly amalgamated Baishuihe Community. These classifications have important repercussions: since residents are not farmers, they are not organized as a rural collective and do not have collective rights of land ownership. For most Baishuihe residents, their property claims are limited to their individual homes (but not the land itself). When the mine was still operating, workers rented these houses from the mine, and after the mine closed, the houses were sold to workers at a nominal cost.

Geography, according to Longmenshan Town officials, is the main factor constraining Baishuihe’s development.³⁴ Baishuihe Community occupies a narrow strip of valley land between the river and a steep slope that rises about 20 m before it turns into a broad plateau. Much of the land in the plateau belongs to neighbouring Baoshan Village, except for a small area where, prior to the quake, the mine workers and their families lived in closely built single-storey cottages (Figure 1). Until the quake, residents lived with members of their old work unit, and many of the neighbourhood groups are named for the former mines. Despite a strong sense of solidarity among former mine workers and their families, the Baishuihe residents’ committee was relatively powerless when it came to decision-making during post-quake reconstruction, which was largely managed by the Longmenshan government.

Figure 1.

Pre-quake homes in Baishuihe.

In Baishuihe, the Longmenshan government promoted a ‘unified planning and construction’ approach (统规统建), under which residents agreed to give up the titles to their houses in exchange for apartments in a new settlement. Part of the appeal of the joint reconstruction approach was financial. While the Sichuan provincial government guaranteed an average subsidy of RMB 25,000 per household, this fell short of the funds needed for rebuilding. The shortfall had to be made up by residents and local governments. The Longmenshan government used the joint reconstruction approach to open up new land for development and negotiate a loan with the contractor, the Chengdu Ninth Air Force Engineering Corps (成都空军第九工程总队). This included a creative financing strategy for the Longmenshan government’s reconstruction plan. According to local cadres, reconstruction cost the Longmenshan government about RMB 180 million.³⁵ The government collected about RMB 60 million from subsidies and from the residents themselves, so the Air Force Engineering Corps effectively provided a loan of nearly RMB 120 million to the Longmenshan government. But local cadres described the loan as a risk-free internal government transaction between two branches of the state. Once the residents have been resettled, the logic goes, the old residential area will be opened up for investment and the Longmenshan government will repay the loan from the Air Force.

The new houses are five- to seven-storey walk-up apartment buildings with some of the lower levels devoted to commercial space (Figure 2). The majority of the new buildings were built between the river and the street on a piece of state-owned land that, until 2006, housed a narrow-gauge railway servicing the mines. After the quake, the Longmenshan government was able to claim the land for reconstruction. Building on the vacant land by the river seemed like an ideal solution – township officials described it as a ‘lifesaving straw’.³⁶ Not only did using state-owned land reduce the cost of providing housing, and thus the costs borne by residents, it also freed up land in the original commercial strip to attract investment to the community. In accordance with the central government’s reconstruction plan, which promoted tourism as a pioneer industry throughout the quake-affected area, the Longmenshan government was promoting the entire area as a centre for rural tourism. The government described this as ‘emptying the cage to change birds’ (腾笼换鸟), a term that describes state-led industrial upgrading strategies.³⁷ In this case, the land is the ‘cage’ that will now be used to host the new ‘birds’ of tourism.

Figure 2.

Post-quake homes in Baishuihe.

But a lack of clear communication from the Longmenshan government about the new housing project, combined with the lack of avenues for affecting the reconstruction process, meant that stories about the project spread quickly. In early 2010 Baishuihe residents noticed a new, unannounced project was being built at a site far away from the central street. No one wanted to live at such a distance from the centre of the community, so residents organized a group of representatives to approach the Longmenshan government. These delegates were strategically chosen: many were former mine leaders whose affiliation with the state made them less threatening to Longmenshan officials. The delegates were told that the new project was a private residential development, and would not be a resettlement site. But this new development continued to be a source of concern for residents, who were well aware that local officials were funding the reconstruction project through (future) land leasing under the deal with the Ninth Air Force Engineering Corps. ‘Where is the money coming from?’, asked one older mine leader at a reconstruction symposium attended by scholars, NGO workers, and government leaders, ‘And what does this have to do with Chengdu’s urban–rural integration policy?’³⁸ His question indicates that residents were well aware of the revaluation of land that was intended to generate funds for their new homes, and how this revaluation was linked to policies originating in the urban centre.

Baoshan Corporation

Baoshan Village is run as a corporation, with villagers acting as shareholders. The Baoshan Village Corporation, in contrast to the Baishuihe residents’ committee, was very active in defining the village’s future development path. Indeed, Baoshan, known as the ‘top village in Western China’, seemed to operate more or less independently of the Longmenshan government. The Baoshan story is displayed in the village’s shiny promotional brochures, a prominent frieze outside the committee offices, and a small museum dedicated to the man considered responsible for the village’s rise in fortune, the former Party Secretary Jia Zhengfang. Secretary Jia worked as a scientist in the 1960s, until deteriorating eyesight caused him to return to his home village. Determined to improve Baoshan’s low living standards, he led villagers on a project of wasteland reclamation. Jia used the painstakingly accumulated surplus from increased agricultural yields to develop the village’s mining resources. Following reform and opening, the village became the Baoshan Enterprise Group Company. In 1979, Baoshan designed and built a hydropower dam in the village. Throughout the 1980s, the village corporation built several more hydropower dams in the surrounding area.

By the 1990s, as with the state-owned mines where Baishuihe residents worked, the Baoshan mines were becoming less profitable. In 1997, Jia Yanjing, the son and successor of Secretary Jia, attended the 15th Party Congress. The younger Jia cited this as a watershed moment for his understanding of development: prior to the meeting, he claimed, he had only thought of using the village’s own funds for development, and had never thought to borrow funds from the bank. After the Congress, he realized how conservative this thinking was, and that it was limiting Baoshan’s development.³⁹ In 2003, Baoshan established a stricter, more modern governance system with professional managers working under a board of directors. With the help of loans, the company drew on its mining expertise to invest in a mining project in Vietnam, and sent a group of villagers to work at the Vietnamese site. The company also started to develop Baoshan’s tourism resources, building a luxury hotel and a golf course. Company profits started to take off during this period. At the end of 2007 the net income for the corporation was RMB 210 million, and the average income for each villager reached RMB 12,322.⁴⁰

In 2005, Baoshan had 611 households (2168 people) divided into 15 villager small groups.⁴¹ About 28.9 per cent of villagers worked outside the village; the rest worked in the collective enterprises (32.1 per cent), in agriculture (20.1 per cent), or were self-employed with small businesses (18.9 per cent).⁴² Spatially, Baoshan’s residents are scattered in about 26 clustered settlement areas, with the largest consisting of 40 households. The plateau, where Baishuihe’s former copper mine workers lived, is mostly owned by Baoshan. Prior to the quake, Baoshan had built a number of European-style villas there that had been leased to urban residents as vacation or retirement homes. Unlike the homes of the Baishuihe mine workers, these survived the quake with minimal damage (Figure 3).

Figure 3.

Baoshan’s pre-quake ‘European-style’ villas.

After the quake, Baoshan residents were able to adopt a ‘unified planning, independent construction’ approach (统规自建), or rebuild their own houses in accordance with a unified plan. The village corporation provided an extra one-time subsidy of RMB 5000 to each household, and established basic planning guidelines for reconstruction that consisted largely of demarcating areas where residents could rebuild, and hiring an architectural firm to come up with a unified design for the houses in each settlement area. But aside from one area near the main road – which was rebuilt as a specialized ‘rural homestay’ quarter – the design codes were not particularly strict. A landscape architect I spoke with in Baoshan expressed frustration about the chaos of the site: residents had built the houses about 10 m away from the plan she carried in her hands, cutting into the space designated for lawns and pathways.⁴³ Outside showcase areas, then, residents seemed to have a certain amount of de facto flexibility in reconstruction.

In fact, village leaders did not seem too concerned about enforcing design standards for residents’ houses. Their attention was focused on other post-quake development projects related to tourism and real estate, including a hot spring resort, a new countryside tourist area, and a scenic area. These projects were headed by Mr Li,⁴⁴ an outside consultant with an entrepreneurial background. Li spent most of his time in Chengdu, but drove frequently from the city to meet with Baoshan leaders. His primary task seemed to be to ‘sell’ Baoshan to outside investors. According to Li, the main platform for Baoshan was ‘tourism real estate’ (旅游房地产), or vacation homes for urbanites. I asked him if these would be like the apartment buildings currently lining the street. ‘Sort of’, replied Li, ‘but the projects we are planning will be at a much higher level. Some residents can afford the apartments on the street, but they won’t be able to afford the new buildings, which will have their own hot spring access.’⁴⁵ What Li was planning, with the support of village leaders, was an elite tourism economy that would be physically and socially separate from the lives of the villagers.

Guoping Village

Reconstruction in Guoping Village, just across the river from Baishuihe and Baoshan, presented a stark contrast to Baoshan. In 2010 there were 435 households and 1376 residents in Guoping Village, divided into 10 villager small groups.⁴⁶ Like Baoshan, most of the land in Guoping is hilly and forested: the village covers an area of 8010 mu (534 hectares), with arable land making up 12.1 per cent (970 mu, or 64.7 hectares) and forest land making up about 86 per cent of village land (6356 mu, or 423.7 hectares).⁴⁷ The primary sources of agricultural income came from gathering medicinal herbs and wild vegetables, and cultivating corn and sweet potatoes. Guoping Village is a ‘traditional’ village, with direct agricultural production still playing a large role in household income. Average annual income for the villagers in 2009 was just RMB 2000, less than a sixth of the average income for Baoshan residents.⁴⁸ Without a dedicated (and well-connected) leader like Secretary Jia, the Guoping collective had never embarked on a Baoshan-style improvement project. Residents had been unhappy with previous village secretaries, so there had been difficulty in filling the position with someone from the village. In the end, an outside cadre was appointed to the position.⁴⁹

During the earthquake, about 95 per cent of houses were seriously damaged, and six residents were killed.⁵⁰ Because Guoping had been classified as a low-income settlement before the quake, the entire cost of housing reconstruction was covered by the state, provided that residents moved into the concentrated settlement under the unified planning and construction plan. A single concentrated settlement area was built consisting of a walled compound of four- and five-storey buildings (Figure 4). Despite their lack of direct involvement, residents seemed largely pleased with the modern design of the new apartments. Their primary concerns revolved around housing allocation and compensation. The new settlement itself had to be built on land belonging to the Number 2 small group – some of the only flat, developable land available in Guoping Village. Number 2 group members claimed that they were supposed to be compensated for the land at a rate of RMB 50,000 per mu (1 mu = 0.067 hectares). But they were worried about what would happen after the money was gone, since they no longer had land to farm. The Number 2 group members also claimed that they had been promised first choice of new apartments. But when the time came for residents to move into the new apartments, the village leaders simply started drawing lots to assign apartments.⁵¹

Figure 4.

Guoping’s post-quake housing settlement.

Bulletins posted outside the Guoping villagers’ committee offices indicated that this allocation policy was established by the Chengdu government, presumably in an attempt to avoid corruption and favouritism at the village level. But Guoping’s allocation procedure was experienced by the Number 2 group members as a violation of promises made to them. This translated into a feeling that the village leaders had a bad attitude towards them, and did not listen to their concerns. Some accused village leaders of embezzling money, based, it seemed, on personal observations of cadres’ new clothes (and new marriages) after the quake. This accusation may or may not be true, but a glimpse at the village budget, posted outside the village offices, indicates why residents may have been dissatisfied about the allocation of village funds (Table 1).

Table 1.

Guoping Village expenses, July 2010.

Expense item	Cost (in RMB)
Village planning	300,000
Geological assessment	180,000
Office supplies	71,699
Cleaning up rubble	8,000
Beer festival	203,589
Village affairs expenses	1,680
Temporary shelter sanitation fees	3,000
Urban–rural comprehensive improvement	3,900

Source: Village budget posted outside the village offices.

The main budget line is for village planning, and the second largest item is for a beer festival that was held in an effort to attract attention and tourists to the area. In media interviews, the village head claimed that he learned from the entrepreneurial leaders of Baoshan Village to ‘seize the opportunity of [post-quake] projects to lay out the basic path to development’.⁵² The village collective economy was reorganized as the Guoping Village Tianxia Company Group, an umbrella for eight other companies including an investment company, a construction company, and a tourism management company. The tourism development plan itself revolved around creating fields of lavender, cherry orchards, and a four-star hotel to attract tourists. Posters around the village read, ‘Trade resources for capital and barren hills for shares; villagers become stockholders and peasants become people who live off the scenery’ (资源换资本, 荒山做股份, 村民变股东, 农民成景民). For village-level cadres, their priorities lie in pursuing local economic development, often through spectacular tourism or real estate development projects. Because these projects are generally spearheaded by outside experts and consultants, rural residents have little to no involvement in them. Moreover, many of these projects fail. Guoping’s lavender fields have yet to materialize: when I last returned to the area in the spring of 2018, Guoping’s post-quake housing units, less than 10 years old, had been demolished and residents had again been relocated. In the place of the former post-quake apartments, commercial high-rise apartments were being built – the type of tourism real estate described by the Baoshan consultant.

Discussion: Where is the money coming from?

Chengdu’s post-quake rural property rights reforms were partly intended to facilitate land-financed rural reconstruction. But in the end, there appeared to be no straightforward answer to the question posed by the Baishuihe resident during the reconstruction symposium, ‘Where is the money coming from?’. In Baishuihe Community, reconstruction was financed through ‘internal state transactions’, or arrangements between the Longmenshan government and the Air Force Engineering Corps. Baoshan’s managers drew on the village corporation’s existing resources and bank loans to attract new real estate and tourism investors. Guoping’s initial reconstruction project was financed by upper levels of government, but village leaders drew from the regular village budget in their attempts to undertake tourism development projects on the land freed up by residential concentration. These cases suggest that land-financed reconstruction may in fact be a misnomer: reconstruction was still funded by the state, or village collective resources, or debt, on the basis of a speculative, uncertain property market through a process of leveraging future land values. This meant that, despite the widely divergent institutional histories across the three communities, the dynamics of reconstruction were similar. In all three settlements, attempts to leverage land values with the assistance of outside experts are resulting in a bifurcated local economic structure consisting of a tourism and real estate economy that operates at a physical and social distance from the lives of residents themselves.

Other analyses of rural residential land consolidation projects in China stress the importance of residents’ participation in the process and of instituting bottom–up oversight systems to avoid local government corruption.⁵³ But in the context of post-quake reconstruction, township leaders in Chengdu were under pressure to rebuild within the central government’s three-year timeline (and the two-year timeline subsequently established by the Sichuan provincial government), making substantive consultation tricky, if not impossible. Even aside from the exigencies of post-quake reconstruction, however, it is worth asking what participation means in the context of a broader revaluation of rural land in urban markets. In Longmenshan, the imperative to generate funds through attracting urban investment translated into an erosion of collective control over collective resources. Moreover, while rural residential land consolidation projects do open up possibilities for corruption and rent capture by township officials (or powerful village groups), the greater problem may be systemic, lying in the perceived need to leverage rural land for investment rather than with any specific case of corruption.

Another issue that the Longmenshan case highlights is the ambiguous nature of the outside expert. After the Wenchuan earthquake, Sichuan was flooded with an army of professionals from across the country, and became something of an experimental testing ground for the emergent science of rural planning in China.⁵⁴ The majority were trained professionals, but a high demand for reconstruction and development planning made the region a particularly rich breeding ground for newly minted ‘experts’. Many of the outside consultants I spoke with had no prior experience working in rural areas, and some had no training in any relevant field (such as economics, agricultural science, tourism, architecture, or planning). What these figures seemed to offer to local leaders, rather than the authority of expertise, was entrepreneurial savvy and a set of connections to potential investors in the city.

New Left scholar Lin Chun points out that it is ‘naïve or deliberately deceptive’ on the part of Chinese liberal reformers to imagine that assigning property rights can protect farmers or offer them a ‘fair share’ of urban development.⁵⁵ Historically, she points out, such moves towards land privatization only result in the concentration of land in the hands of real estate gamblers or agroindustrial capitalists. The Longmenshan case suggests that this dynamic is emerging in rural Chengdu, where in some areas control over rural property rights is collecting in the hands of real estate gamblers. But it is not at all apparent that these tourism and real estate projects will succeed, particularly since nearly every community in the quake zone is pursuing a similar development strategy. It is perhaps in the failure of these strategies that openings for autonomous rural development may emerge – visions that are not predicated on the needs of urban capital.

Footnotes

Notes

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