Probe into the Development Mode of Low-income Settlements in the Urbanization Process to Release

On December 13, 2012, Probe into the Development Mode of Low-income Settlements in the Urbanization Process, collaboratively written by the National Academy of Economic Strategy of CASS and UN-HABITAT, was published by Social Sciences Academic Press. This book is a phased achievement of “Study on Promoting Steady and Balanced Development of Real Estate Market”, a major project of National Social Science Fund. It assesses the achievements of the Liaoning shantytowns reconstruction afterwards, summarizes its experiences and concludes its theories.

Probe into the Development Mode of Low-income Settlements in the Urbanization Process

Issued by National Academy of Economic Strategy of CASS and UN-HABITAT,

Says,

4-year Liaoning Shantytowns Reconstruction Improves the Housing Conditions of 2.11m Populations in 706k Households,

Creating a “World Miracle”, & Catching Attention of Global Society

Low-income settlement is a big puzzle during human development. Cities in the world are all troubled by slums indeed, but the global society can do nothing to deal with it. UN-HABITAT says in its report that in 2010 the population in world’s slums was 827.6 million, almost 1/4 of global urban population, and was skyrocketing. UN report believes the international society has done neither much nor well where the problem was concerned.

Liaoning province was the first one to probe into paths and methods of renovating large-scaled urban and state-owned industrial and mining shantytowns in early 2005, and spent 4 years finishing 29.1 million sqm reconstructions of concentrated urban shantytowns, anyone of which was at least 10,000 sqm, constructing 44 million sqm of new residential housing, and improving the housing conditions of 2.11 million populations in 706 thousand households. These achievements were almost twice as much as the average millennium development goals on slum reconstruction per year, proposed by UN.

Large reconstruction scale: renovating 29.1 million sqm of concentrated urban shantytowns, anyone of which was at least 10,000 sqm; including 4.91 million sqm in Shenyang, 3.69 million sqm in Fushun, 2.01 million sqm in Benxi, 3.7 million sqm in Fuxin, 1.24 million sqm in Tielian; besides, constructing 44 million sqm of new residential housing.

Short reconstruction term: the shantytowns reconstruction in Liaoning province started in 2005 and almost finished in 2010; residents from most shantytowns were moved back and relocated in 2 years; the reconstruction was completed ahead of schedule.

Large population involved: the housing of 2.11 million populations in 706 thousand households was settled.

High investment efficiency: the input-output ratio of capitals spent on the shantytowns reconstruction was way higher than the average market ratio. The Liaoning shantytowns reconstruction investment was very efficient.

High satisfaction: the improved residential housing was more comfort, the ancillary facilities were more, and entertainment life was richer; the satisfaction surveys on these three aspects were high to 93.0%, 80.9% and 82.3% respectively; 73.3% interviewees were satisfied with business behaving of governments at all levels.

The experiences of the Liaoning shantytowns reconstruction provided references for the world to handle with “slums” and this reconstruction aroused wide attention of the global world. Experts from UN-HABITAT participated in the whole process of this research, and compared this sample with other international counterparts in this book.

Probe into the Development Mode of Low-income Settlements in the Urbanization Process

Issued by National Academy of Economic Strategy of CASS and UN-HABITAT,

Says,

Liaoning Shantytowns Reconstruction Brings a Huge Change, and Becomes a Sample of Taking People’s Livelihood as Fundamental

On December 13, 2012, Probe into the Development Mode of Low-income Settlements in the Urbanization Process, collaboratively written by the National Academy of Economic Strategy of CASS and UN-HABITAT, was officially published by Social Sciences Academic Press. This book is a phased achievement of “Study on Promoting Steady and Balanced Development of Real Estate Market”, a major project of National Social Science Fund. It assesses the achievements of The Liaoning shantytowns reconstruction afterwards, summarizes its experiences and concludes its theories.

From 2005 to 2008, Liaoning Provincial Committee and Government, under the lead of Li Keqiang, Liaoning Provincial Secretary back then, overcame many difficulties and determinated to implement overall reconstruction. In just two years, they constructed 23.726 million sqm warm and capacious houses for 1.427 million residents from 418.8 thousand gloomy and cold shantytown households to move back. The Liaoning shantytowns reconstruction is to tear down a large area of low and shabby shantytowns and re-construct new buildings. From a macro perspective, it is actually upgrading the city. The essence of urban renewal lies in reforming and refreshing the city under the premise that city culture, order and texture is kept as much as possible. The reconstruction changes living environment of original shantytowns residents, community facilities and environment, and even both city and provincial economy as well; it also upgrades the government image. The Liaoning shantytowns reconstruction is featured of large scale, short time, large population involved, large accomplishment ratio, high investment efficiency and satisfaction. It’s a world miracle.  

  The statistic data shows that: 1) from 2005 to 2011, accumulated construction capitals invested into the Liaoning shantytowns reconstruction was up to 73 billion yuan, and almost 250 billion yuan benefits were brought along; 2) 84.2% residents acknowledged the government fulfillment of its commitment, and 76.4% and 73.5% residents were satisfied with the assessment and the compensation respectively; 3) 46.3% residents were more satisfied with the government after the reconstruction. The Liaoning shantytowns reconstruction changes households, community and the city, and stands as a sample that how to take people’s livelihood as fundamental. The reconstruction brings huge changes in four levels and provides important experience value, academic value and practical value. China is under the fast urbanization, so the reconstruction of old towns like low-income settlements attaches great importance to upgrade city management level and construct a harmonious society. Social incidents happen a lot and social issues are emerging in cities where old towns are not well renovated. It has very practical significance to study the Liaoning shantytowns reconstruction and conclude its in-depth experiences

Probe into the Development Mode of Low-income Settlements in the Urbanization Process

Issued by National Academy of Economic Strategy of CASS and UN-HABITAT,

Says,

Liaoning Shantytowns Reconstruction Innovates Public Polities and Explores the Governance of “Slum”,

the World Puzzle

On December 13, 2012, Probe into the Development Mode of Low-income Settlements in the Urbanization Process, collaboratively written by the National Academy of Economic Strategy of CASS and UN-HABITAT, was officially published by Social Sciences Academic Press. This book is a phased achievement of “Study on Promoting Steady and Balanced Development of Real Estate Market”, a major project of National Social Science Fund. It assesses the achievements of the Liaoning shantytowns reconstruction afterwards, summarizes its experiences and concludes its theories.

  This book says, China is undergoing the largest urbanization acceleration in human history. When low-income groups pour into cities, the urban housing pressure is soaring. The poverty-stricken neighborhoods in some cities are already emerging; actually the so-called “village-in-town” and “shantytowns” are quite similar to the slums in foreign countries. Those international experiences tell that Chinese cities bear enormous pressure in terms of the poor people’s settlement, which is probably evolving into slums.  

Since 2005, Liaoning province spent 4 years in renovating 29.1 million sqm concentrated shantytowns, any of which was at least 10,000 sqm, constructing 440 million sqm of new residential houses, improving living conditions for 2.11 million populations in 706 thousand households. It’s a world miracle. The reconstruction breaks the clichés that poor people are gathered in shantytowns, and probes into new paths of shantytowns reconstruction.

---- Fund raising and usage: diversified financing and dynamic balance

Housing investment shortage is the main factor of creating shantytowns in Liaoning province and restricting shantytowns reconstruction. The Liaoning provincial government leverages social capitals by financial investments, for example, 1) creating favorable financing environment and establishing effective financing platforms; 2) taking the market as primary financing channel, and constructing diversified financing channels as well; 3) local governments raise capitals in diversified way and explore multiple financing channels in the very beginning of reconstructions. As to capital usage, all funds are in closed operation and a fixed sum is for a fixed purpose; as to debt payment, the increment should be increased while the inventory should be balanced. The government expenditure leverages the market funds to its most extent, while the market funds play the primary role.  

---- Land development and utilization: free allocation, and commercial lands supplementing residential lands

Lands are well integrated from 4 aspects: 1) efficiently integrating and reserving lands; 2) determining use properties of lands, and rationally utilizing land resources; 3) preferentially allocating lands for free; 4) using commercial lands to supplement residential lands, and giving benefits to citizens.

---- Housing development and construction: developing by category, but dismantling and constructing the whole

As to shantytowns dismantling, it should dismantle the whole shantytowns but implement in gradual steps; as to reallocated housing construction, it should construct houses in large scale but develop by category; as to resident removement, it should sell houses at favorable prices and reallocate residents in batches; as to reconstruction final-period management, the government should take the final responsibility but the reconstruction should be managed by itself.

---- Improvement and reconstruction of residents’ payment abilities: adequate blood transfusion, but focusing on hematopoiesis

Residents should be treated by category but generally insured that everyone has a house to live; long-term and short-term helps should be integrated to keep residents not afloat; trainings should be taken and employment opportunities should be increased to enhance the sustainability of residents’ payment; technical support should be available to serve residents’ business and help them start business.

---- Economic transition and development: using shantytowns reconstruction to promote development, and using development to drive shantytowns reconstruction

Investment invitation should be attached importance to, and industrial concentration should be accelerated to enhance the economic strength of shantytowns reconstructions in cities; private enterprise development should be promoted to increase employment opportunities for removed residents who used to live in shantytowns; reforms on state-owned enterprises should be intensified to increase incomes of removed residents; neighborhood economy should be developed to provide flexible employment opportunities for removed residents; favorable environment for economic development should be created to encourage removed residents to start their own businesses.

--- Social change: remolding residents and reconstructing neighborhoods

Neighborhoods are reconstructed, and governors are cultivated; service facilities are consummated to enhance service abilities; public services are available, and life systems are reconstructed; cultural quality is improved and personality is remolded.

---- Environment construction: comprehensive improvement and consummate ancillary facilities

Neighborhood infrastructure and housing should be planned and constructed at the same time; neighborhood infrastructure and municipal infrastructure should be seamlessly integrated; ecological environment should be improved, dirty, messy and unsafe shantytowns should be thoroughly changed; ancillary commercial infrastructure should be constructed to facilitate residents’ lives.

---- Urban spatial structure: optimized layout and mixed reallocation

Residents are reallocated in either their original places or other places; reallocated residents are generally disperse, but some are centralized, even individuals are mixed into other neighborhoods, so the poor are no longer gathered in one place; internal space development of cities should be coordinated, and urban space functions should be clearly defined.

The public policies of the Liaoning shantytowns reconstruction involves eight aspects, which solve all problems occurred before, during and after the reconstruction. The reconstruction innovates public policies and provides practical experiences for “slum” governance, the world’s puzzle.

Other readings related to the Liaoning shantytowns reconstruction:

Urbanization is the Most Promising Bonus

Vice Premier Li Keqiang wrote a paper recently, saying that the Reform and Opening-up was the biggest bonus for China development and the largest development potential of China laid in urbanization in next decades. Li’s paper also explicitly defined the source and the power of sustainable development of Chinese economy.

Urbanization is the most promising bonus of China’s economic and social development in future. On one hand, urbanization transfers non-agriculture industries and population into cities, allocates resource elements rationally, improves resource utilization ratio, deepens divisions of labors based on specialization, and achieves increasing returns to scale (IRTS) inside enterprises. On the other hand, the spatial concentration of population and economy promotes communication and cooperation of enterprises and residents, decreases trade costs of relevant activities, and utilizes external scale economy of cities, so rural production and lives, where specialization degree is low and economic activities are comparative disperse, are created. In addition, conventional rural lifestyle is comparatively self-sufficient, and the added values of conventional agriculture are comparatively low, so rural purchasing power is weak, but when large population is transferred into cities, effective demands will be increased. Consumption, this carriage to drive economic growth, will be more powerful. And the engine of economic growth will be more powerful.

If China achieves 75% urbanization in 2030 indeed, over 200 million agricultural populations will be transferred into cities and 160 million half urbanized people will continue their urbanization in next 20 years. Nearly 400 million populations in cities will provide 3 million labors, almost the total population of USA, for urban economic and social development. According to the current urban-rural income gap, 400 million populations transferred into cities will increase 3000 billion yuan of consumer spending per year, amounting to 6.3% GDP in 2011, and 13% final aggregate consumer spending.

“Urban China” is about to Outbreak Urban Diseases  

The data issued by National Bureau of Statistics (NBS) indicates that by the end of 2011, the permanent resident population of Chinese mainland cities reached 690 million, accounting for 51.27%, which exceeded the rural population proportion for the first time. Since then, Chinese mainland has entered into urban era from rural era. The international experiences tell that when the urbanization ratio of one country or region is over 50%, urban diseases symptomized of housing, traffic congestion and environmental pollution are about to burst. How to treat urban diseases will be the most desperate and risky issue for Chinese economic and social development in future.

Urban diseases express themselves in many aspects of economy, society and environment. As far as social issues are concerned, urbanization will cause traffic congestion, housing shortage, employment difficulties, and increased social insurance pressure. If 75% urbanization is achieved in 2030, over 200 million agricultural populations will be transferred into cities and 160 million half urbanized people will continue their urbanization in next 20 years. As far as housing is concerned, at least 100 million new houses are needed for these new migrants, amounting to 2.5 times of accumulated completed residential houses (42843947 houses) developed by real estate developers during 2000 to 2010; not to mention improving the living conditions of 200 million permanent urban residents who are living in irregular settlements. As far as employment is concerned, creating employment opportunities for 300 million new urban migrants will be the prioritized responsibility for governments at all levels to improve people’s livelihood and stabilize society in next 20 years.

When pollution and industries are centralized in short time, the existing urban infrastructure is far from enough for the largest urban in human history. Traffic congestion and environmental pollution is getting worse, not only urban economy growth efficiency is decreased, but also the international images and international competitiveness of cities are negatively affected. Future development of cities will be curbed either.

Urban Diseases are the Largest Challenge for Chinese Urbanization in Future

Urbanization is a double-edged sword. From a favorable perspective, when rural population is transferred into cities, agricultural labors change their professions, agriculture proportion of industrial structure is decreased, and territory and space structure is changed, the urbanization can absorb much surplus rural population, promotes rural development, improves industrial production efficiency, changes regional industrial structure, narrows down urban-rural development gaps, and upgrades the overall development levels of regions. Urbanization is the source and the power of sustainable development of Chinese economy.

From an unfavorable perspective, over-concentrated population and industries will cause many troubles for environment, economy and society. As far as environment is concerned, urbanization decreases cultivated lands, worsens soil and air pollution, intensifies heat island effects, deteriorates water quality and causes water resource shortage; as far as economy is concerned, over-concentrated population and industries will cause urban land resource shortage, increased land prices, and increased enterprise production costs including labor salaries. As far as social issues are concerned, urbanization will cause traffic congestion, housing shortage, employment difficulties and increased social insurance pressure. All troubles mentioned above are so-called urban diseases.

Urban diseases are the largest challenge for Chinese urbanization in future. If China achieves 75% urbanization in 2030 indeed, over 200 million agricultural populations will be transferred into cities and 160 million half urbanized people will continue their urbanization. That means extra 20 Shanghai cities or 40 Shenzhen cities should be constructed in next 20 years to arrange these migrants. How to solve housing, employment and social insurance of 400 million populations is the tough challenge for governments. Besides, the worse environmental pollution (such as air pollution and atmospheric pollution) and traffic congestion has weakened the happiness of urban residents and affected the international images and the international competitiveness of cities.

Liaoning Shantytowns Reconstruction is a Comprehensive Experiment on Urban Disease Prevention

Urban diseases are difficult and miscellaneous, integrating environmental, economic and social elements. They include environmental pollution, traffic congestion and housing shortage, and also include weak economic growth, insufficient public services, worse public security, high unemployment and social disharmony. We cannot take stopgap measures but need comprehensive solutions to treat urban diseases.

In 2005, Liaoning province carried out a comprehensive experiment on urban disease prevention, renovating Shantytowns as a start and improving people’s livelihood as a core. Liaoning provincial committee and government took the Shantytowns Reconstruction as “No. 1 Project” for the purpose of improving people’s livelihood. They leveraged government and market strengths to renovate shantytowns in the whole province. Liaoning provincial committee and government adhered to the principle of “government-dominating, market-operating and society-participating”, took the policies as driving force, financial investment as leverage, and land operation as measures, and leveraged social funds into the reconstruction. They solved many problems that curbing urban economic and social development in Liaoning province, and completed the comprehensive experiment on urban disease prevention.

The Liaoning Shantytowns Reconstruction aims at improving livelihood of low-income residents, but it also solves problems like employment, salvation and social insurance of residents, urban environmental management, infrastructure construction, urban spatial structure optimization, revitalization of old industrial bases, and urban sustainable development. During the reconstruction, Liaoning provincial authorities combine housing improvement with resident income and low-income resident help system improvements together to allow residents to afford the houses; combine housing improvement with municipal infrastructure construction, environmental governance, public service supply equalization and new neighborhood construction together to allow residents to have a good living; combine housing improvement with resident employment, urban spatial structure optimization, revitalization of old industrial bases, and cultivation of new urban growth points together to allow residents to live forever.

Liaoning Shantytowns Reconstruction Provides a Solution to Treat Urban Diseases

Urban disease is a big puzzle that most medium-sized and large-sized cities confronted or are confronting in the world. When China is moving into urban society from a rural society, its biggest challenge in future will be how to solve urban diseases. As we are late in urbanization, most municipal governments have few experiences and simple measures. The Liaoning Shantytowns Reconstruction started in 2005 provides a systematic solution to treat urban diseases.

Liaoning provincial committee and government adhered to the principle of “government-dominating, market-operating and society-participating”, took the policies as driving force, financial investment as leverage, and land operation as measures, and leveraged social funds into the reconstruction. They solved many problems that curbing urban economic and social development in Liaoning province, and completed the comprehensive experiment on urban disease prevention.

“Government-dominating and market-operating” is a very rigorous system combined by multiple elements, which are independent of each other but supportive to each other. The modest of Liaoning Shantytowns Reconstruction include: philosophy and methods, system and mode, public policies (including strategies and plans, systems and policies, management and services) and contents (including finance, land, housing, economy, society, environment and space).  

As far as policies and contents are concerned, “scientific development and reconstruction” is the guidance. Guided by the Scientific Outlook on Development, the shantytowns reconstruction and economic and social development is well carried out. The systematic mode of “government-dominating and market-operating” is the core. The defects of government failure and market failure are overcome, resource allocation is optimized, and the initiation of participants is played to its most extent. The strategic plan of “considering all factors and balancing them” is the first priority. The reconstruction is combined with economic and social development, so both are mutually promoted. The policy of “constructing ancillary facilities to benefit people for long” is the fundamental. The systems and polices are innovated and improved to make new houses available to shantytowns residents and allow them to afford new houses and live forever. The management service of “normalization, order, human-oriented and self-governance” is the guarantee. A series of supervision, management and service modest are innovated and applied to make sure reconstruction affairs “fair, just and open”.

As far as affairs involved in the reconstruction are concerned, the land policy of “free allocation, commercial lands supplementing residential lands” and the finance policy of “diversified financing and dynamic balance” are the conditions. The space-time mispairing is used to solve the most important land and fund issues. The development mode of “developing by category, but dismantling and constructing the whole” is the fundamental. It shows the integration of government and market and is the fastest way to solve problems. The aid policy of “adequate blood transfusion, but focusing on hematopoiesis” is the key. Obtaining viabilities of households is to solve the low-income settlement from the root. The economic policy of “using shantytowns reconstruction to promote development, and using development to drive shantytowns reconstruction”, the social policy of “remolding residents and reconstructing neighborhoods”, the environmental policy of “comprehensive improvement and consummate ancillary facilities” and the spatial policy of “optimized layout and mixed reallocation” are the support.

The Liaoning Shantytowns Reconstruction solution solves problems of low-income settlements and further promotes comprehensive coordinated sustainable development of economy, society and environment.