Secure Land Rights as a Foundation for Broad-Based Rural Development in China
Results and Recommendations from a Seventeen-Province Survey

EXECUTIVE SUMMARY

MAIN ARGUMENT

Land is disproportionately valuable to poor households in the world. In China, it could hold the key to sustainable, broad-based development and lay the foundation for wealth-creation and empowerment for over 750 million rural people. Today, the countryside of China—where some three-fifths of the country resides—is lagging badly behind the urban sector by virtually every economic and social measure. A fundamental reason for the rural-urban disparity is that a majority of Chinese farmers do not have secure rights to the land that they farm. More than 40% of farmers lack any written documentation to confirm their land rights, and local governments can frequently take away or sell off farmers’ land rights using strong-arm methods. Where land rights have been implemented, however, Chinese farmers have a sense of security and are increasingly investing in their land and benefiting from market transfers reflecting a substantial land value. China can improve its legal regime for rural land rights by further improvements in the written legal framework and by implementing the existing laws on the ground.

POLICY IMPLICATIONS

• With secure, long-term land rights, as now provided by law, a high proportion of China’s 200 million farm households could soon start making long-term investments in their land. This will greatly increase farm productivity and income, leading these farmers to become market participants and consumers whose unleashed spending power can benefit the entire world.
• Secure land rights will represent a massive new source of wealth—one that can be estimated at $1.2 trillion—in Chinese farmers’ hands.
• A concerted campaign for full implementation of farmers’ land rights is needed to achieve these sweeping benefits, including publicity and documentation on land rights and further “rule of law” measures.