2014-15 Canada-China Business Forum Magazine - Page 62

CHINA’S URBANIZATION IN CONTEXT What’s in Store for Canadian Companies Over the past few years, endless accounts of China’s urban transition have filled headlines and topped bestseller lists. The numbers support a tale of unprecedented social and economic change. In 1978, at the outset of market reforms, China’s urban population stood at 17.9 per cent of the total population. By the end of 2012 it had grown to 52.6 per cent of the total population, representing a 35 per cent increase in just over three decades. by JESSICA WILCZAK T his March, China’s leaders revealed a new national urbanization plan that would move another 100 million people into cities by 2020. The announcement comes after three decades of headlinegrabbing growth. China’s urban population grew by 500 million – from under 20 per cent of total population in 1978 to 52.6 per cent by the end of 2012. The Chinese government wants to raise this figure to 60 per cent over the next six years through a combination of infrastructure investment, social policy reform and changes in local government financing. testing/Shutterstock Although this seems like a shocking leap, Japan and South Korea went through similar jumps after the Second World War. South Korea’s urban population jumped by 50 per cent between 1960 and 1990. In absolute terms, China now has the world’s largest urban population at over 600 million. But as a proportion of China’s total population, 52.6 per cent falls far short of the OECD average of 80 per cent in 2013. Furthermore, China’s rate of urbanization has slowed in recent years, leading researchers with the Economist Intelligence Unit to predict that China will not hit the 80 per cent mark until 2080. 61 The plan also represents a new positive approach to cities. Since the Mao era, the Central government has tried to control population movement through household registrations or hukou that tie every family to a fixed place of residence and an agricultural or non-agricultural status. This system has helped prevent the growth of urban slums in Chinese cities. At the So what makes the National NewType Urbanization Plan (2014-2020) different from the more or less unplanned urbanization of the past three decades? First, the plan is meant to generate a significant CANADA CHINA FORUM BUSINESS 2014-2015 ccbc.com same time it has also created a large underclass (estimated at 236 million in 2012) that, lacking an urban hukou, cannot access public services like health care and education. Yet with urban residents earning over three times more than their rural counterparts, the tide of rural migration has proven difficult to stem. The new plan will make China’s urbanization process more inclusive and “humancentred” by increasing th