The politics of land use conversion in china case study of a guangdong county 1

Chapter One
Introduction
1
Introduction
China saw rapid expansion in the area of land used for human settlements, industrial
and mining sites from 1949 to 1996. According to Lin and Ho, this expansion of land
for construction had taken place at the expense of agricultural land and unused land,
among which the loss of cultivated or arable land (gengdi) was most acute. Based on
an analysis of the 1996 nation-wide land survey results, it was estimated that around
80 percent of newly acquired land for construction was converted from arable land.
1
In addition, much of the converted arable land was requisitioned from peasant
collectives. Of the 2.26 million hectares of arable land converted to non-agricultural
use from 1987 to 2001, it was estimated that 70 percent or 1.58 million hectares were
collectively-owned land requisitioned by the government.
2
As of 2007, China’s arable
land per capita had fallen to 1.39 mu or 0.093 hectare, which is only a third of the
world’s average.
3

The depletion of agricultural land was accompanied by a rise in proceeds from land
leasing. In 2006, total revenue from the leasing of state-owned land swelled to 767.7
billion yuan, a jump of 30 percent from that of 2004.
4
The lucrativeness of land
leasing, constitutes a strong revenue imperative for governments at various levels,
propelling a host of intractable and unlawful government behaviour in the use of land.
Since 1999, there had been over one million instances of unlawful land practices.
5
1

George C. S. Lin and Samuel P. S. Ho, “China's Land Resources and Land-Use Change: Insights from
the 1996 Land Survey,” Land Use Policy, No. 20 (2003), pp. 97.
2
“Shui guanxin shidi nongmin de mingyun?” (“Who will care for the fate of landless farmers?”),
Zhongguo jingji shibao (China Financial News), 9 May 2003. One mu is equal to 0.067 hectare. In this
thesis, I use “cultivated land” and “arable land” interchangeably to refer to “gengdi.”
3
“Woguo tudi jiadi zhi duoshao?” (“How much do you know about our country’s land assets?”),
Zhonghua renmin gongheguo guotu ziyuan bu (The Ministry of Land and Resources P.R.C.),
, 20 November 2007, accessed 12 February 2008.
4
“Zhongguo guotu ziyuan gongbao” (“China’s national land resources bulletin”), 2006, Zhonghua
renmin gongheguo guotu ziyuan bu (The Ministry of Land and Resources P.R.C.),
, accessed 2 December 2007.
5
Zhang Xiaosong, “Tudi weifa xingwei chengxian san da xin tedian” (“Three new characteristics of
unlawful land practices”), Jingji cankaobao (Economic Reference News), 17 April 2006, pp. 003.
Yew Chiew Ping
1
Chapter One
Introduction
According to the law enforcement bureau of the Ministry of Land and Resources
(MLR), almost all severe cases of land offences involved government officials.
6
From September to mid November 2007 alone, the MLR uncovered 32,000 cases of
illegal land use involving 233,450 hectares of land. The majority of the cases had to
do with using and occupying land before obtaining approval, often for key
construction projects at the national and provincial levels. Usual violators include
cadres and political leaders at the prefecture-level and below, of various government
departments such as the court, land and housing management bureau, construction

bureau, and land resources bureau.
7
More often than not, government officials at
different levels and departments collude to take hold of collective land through
unlawful means. In a typical case highlighted by the MLR, for example, one
company’s illicit acquisition of land in a county of Henan was facilitated by a network
of government officials including the county-level land and resources bureau chief,
the county head and vice head, the former vice head of the county’s Standing
Committee of the People’s Congress, the town party secretary, and village cadres.
8

Some may contend that the extensive conversion of agricultural land for construction
is hardly surprising given China’s rapid urbanization since the late 1970s. In under a
decade, urban population increased from in 215.7 million in 1982 to 314.4 million in
1990, after which it boomed further to nearly 470 million or 37 percent of the entire
6
Zhang Xiaosong, “Tudi tiaokong xinzheng jianzhi defang ‘tudi caizheng’” (“Macro-control of land
targeted at ‘land financing’”), Xinhua meiri dianxun (Xinhua Daily News Bulletin), 6 September 2006, pp.
001.
7
“Quanguo tudi zhifa bairi xingdong tongbao de ba qi dianxing tudi weifa anjian chachu qingkuang”
(“Report on the nation-wide hundred-day enforcement of land laws: investigation and prosecution of
eight typical cases of land laws infringement”), Zhonghua renmin gongheguo guotu ziyuan bu (The
Ministry of Land and Resources P.R.C.), , 10 December 2007, accessed 13
December 2007; Yu Zeyuan, “Zhongguo jianchabu: jiang baochi gaoya chachu tudi weifa’an” (“China
Ministry of Supervision to keep up unrelenting investigation and prosecution of unlawful land practices”),
Lianhe zaobao (United Morning Post), 11 December 2007.
8
Yu Zeyuan, “Zhongguo jianchabu.”
Yew Chiew Ping

2
Chapter One
Introduction
population in 2000.
9
The demands of a growing population have fuelled the taking of
agricultural land for urban development such as housing and other infrastructure.
Yet alongside this urban spatial expansion propelled by demographic changes, a
different path of urbanization has been observed since the mid-1990s. Instead of
being driven by the needs of a bigger urban population, city expansion is motivated
by land finance (tudi caizheng), whereby local governments raise revenue and attract
investment through land leasing and land development that necessitate the extensive
conversion of agricultural land.
10
In other words, land is primarily used as an
instrument to enhance the government’s fiscal situation rather than to accommodate
a growing urban population.
In view of these two concomitant processes of urbanization in China, it may be
argued that attributing the conversion of agricultural land to the demands of
urbanization only tells part of the story. The other part of the story revolves around
the supply of agricultural land for conversion and what determines this supply. Since
local officials are the key decision-maker empowered to manage and regulate the
supply of land within the constraints of central policy, how local officials benefit from
land use conversion and the ways in which their incentive structure is shaped by the
institutional context are important to understanding the supply side of the story. The
central role of local state agents in supplying land is further augmented in the context
9
See Shen Jianfa, “Estimating Urbanization Levels in Chinese Provinces in 1982-2000,” International
Statistical Review, Vol. 74, No. 1 (2006), pp. 95. The figures are calculated based on the 1982, 1990
and 2000 censuses and have been adjusted to include a non-hukou population.

10
Refer to George C. S. Lin, “Reproducing Spaces of Chinese Urbanization: New City-Based and Land-
Centered Urban Transformation,” Urban Studies, Vol. 44, No. 9 (2007), pp. 1832-33; Liu Mingxing, Tao
Ran, Yuan Fei and Cao Guangzhong, “Instrumental Land Use Investment-Driven Growth in China,”
Journal of the Asia Pacific Economy, Vol. 13, No. 3 (2008), pp. 313-31. See also Lin Jiabin, “Dui
‘chengshi jingying’ re de toushi yu sikao” (“Insight and reflection on the ‘urbanization business’ fever”),
Chengshi guihua huikan (Urban Planning Forum), No. 1 (2004), pp. 10-13; Liu Shouying, “Jingti tudi
jingying chengshihua de caizheng he jinrong fengxian” (“Be wary of the financial risks in using land
deals to promote urbanization”), Lilun tantao (Theory Exploration), No. 9 (2005), 46-47; Zhang Meng
and Miao Jie, “Chengshi tudi jingying zhong de yige yidiyangdi moxing de fenxi yanjiu” (“The land
financing model in urban land transactions: an analysis and study”), Quanguo shangqing (Nation’s
Business News), No. 12 (2007), pp. 32-33.
Yew Chiew Ping
3
Chapter One
Introduction
of China, where the State monopolizes the supply of agricultural land for users who
intend to utilize it for non-agricultural purposes.
11
The central question this study asks, therefore, is: what determines local
governments’ capacity in supplying agricultural land for conversion? The quest to
answer this question begins from an investigation of the general incentives for and
constraints on local officials in supplying land before delving into local variations. This
thesis first raises the following query: in what ways does the supply of agricultural
land for conversion serve as an instrument to local governments in fulfilling their
objectives? Through a case study of a county-level city in Guangdong, it then poses
the question of how this general incentive structure that shapes officials’ behaviour
interact with local conditions, such as the local fiscal situation, path of development
or industrialization, the availability of land resources and other resources, quality of
governance etc., to determine local patterns of land use conversion. Since a crucial,

if secondary, theme that runs through this study is the consequences of land use
conversion, some attention shall also be devoted to answering these questions: What
are the externalities of instrumental land use conversion? Under what conditions is it
beneficial or detrimental for the society under local governance?
Defining Land Use Conversion in this Study
Under China’s Land Administration Law, land is classified into three categories
according to usage: land for agriculture (nongyongdi), land for construction (jianshe
yongdi), and unused land (wei liyong di). Land for agriculture is further subdivided
into arable land (gengdi), forest (lindi), pasture (caodi), land for irrigation and water
conservancy (nongtian shuili yongdi), and water surfaces for aquaculture (yangzhi
shuimian). Of the categories of agricultural land, arable land is the core of the State’s
concern. Land for construction refers to land on which buildings and other structures
11
There are, of course, illegal means of getting agricultural land directly from rural collectives or
peasants through the black market.
Yew Chiew Ping
4
Chapter One
Introduction
are erected, including land used for housing in urban and rural areas, for public
utilities, for industries and mining, for communications and water conservancy, for
tourism and military installations and so on. Unused land refers to all land other than
those for agriculture and construction.
12
Figure 1.1 depicts how land is currently used
in China.
Figure 1.1 Land Use Distribution in China, 2007 (%)
Wate r
Cons e r vancy
0.38

Other
Agricultur al
land
2.68
Res idential,
Industrial and
M ining
2.8
Roads
0.26
Forest land
24.84
Orchards
1.24
Cultivate d
land
12.81
Unused Land
27.45
Gras s land
27.54
Source: “Zhongguo guotu ziyuan gongbao,” 2007.
In addition, land is also classified by ownership. Under the Land Administration Law,
land in the urban areas of cities is owned by the State whereas land in rural and
suburban areas is owned by peasant collectives (nongmin jiti), with the exception of
that owned by the State as provided for by the law. Housing sites and private plots of
cropland and hilly land are owned by peasant collectives.
13
Land use conversion in this dissertation refers specifically to the process whereby
land for agriculture is converted into land for construction. According to the Land

Administration Law, Chapter 5, Article 43,
12
Refer to the Land Administration Law (Tudi guanlifa), Chapter 1, Article 4.
13
Ibid., Chapter 2, Article 8.
Yew Chiew Ping
5
Chapter One
Introduction
all units and individuals that need land for construction purposes shall apply
for the use of state-owned land in accordance with the law, with the exception
of those who have lawfully obtained approval to use collectively-owned land
of their own collective economic organizations to start town and township
enterprises and build houses for villagers, or those who have lawfully
obtained approval to used collectively-owned land to build public utilities and
public welfare undertakings in a town(ship) and village.
14
Since agricultural land is likely to be located in rural and suburban areas, land use
conversion often involves a change of ownership from the peasant collectives to the
State.
15
After land use conversion is approved, collectively-owned land has to be first
expropriated or requisitioned (zhengshou) from peasants, effectively transferring
ownership to the State before it can be conveyed to potential users.
16

Land use change, however, often takes place without going through the proper
procedures outlined above. In 2005, the MLR’s surveillance of 16 cities through
satellite remote sensing reveals that close to 50 percent of newly added land for
construction were acquired unlawfully.

17
A common way of violating the law is to
convert agricultural land without a change of ownership.
18
While maintaining
collective-ownership, agricultural land is converted to land for construction through
leasing, shareholding, transfer and exchange. Peasants lose their land use rights in
the process and no land conveyance fee is paid to the State in the process.
19
In other
instances, local governments occupy arable land without accounting for the
adjustment in their respective land use plan; they may also convert land for urban
14
In general, though, the land use rights of collectively-owned land are not to be sold, transferred or
leased for non-agricultural construction. See the Land Administration Law, Chapter 5, Article 63.
15
For a detailed analysis of land-use change based on the 1996 land survey, refer to Lin and Ho,
“China’s land resources,” pp. 87-107. For land use change in China’s coastal region, see Ho, Samuel P.
S. and George C. S. Lin, “Converting Land to Nonagricultural Use in China's Coastal Provinces:
Evidence from Jiangsu,” Modern China, Vol. 30, No. 1 (2004), pp. 81-112.
16
Refer to the Land Administration Law, Chapter 5, Article 45. Land expropriation has been a major
cause of conflicts between villagers and officials, often because of low or unpaid compensation and
other mis-implementations in the process. Refer to a case study in Chapter Six of this thesis.
17
Zhang Xiaosong, “Tudi tiaokong,” pp. 001.
18
With the exception of township and village enterprises (TVEs) and other undertakings specified in
Article 43 of the Land Administration Law.
19

Yuan Ying and Kong Xiangzhi, “Nongcun gongyehua guocheng zhong tudi feinonghua moshi yanjiu”
(“A study on the models of non-agricultural land use conversion in the process of rural industrialization”),
Shanxi caijing daxue xuebao (Journal of the Shanxi University of Finance), Vol. 28, No. 1 (2006), pp.
53-55.
Yew Chiew Ping
6
Chapter One
Introduction
construction in the name of village building or collaborate with real estate developers
to build properties on villagers’ land; others covertly approve or condone the illegal
use of land.
20
In short, land use change may be unlawful in two respects: non-
agricultural activity is undertaken on collectively-owned agricultural land without the
formal transfer of ownership from the collective to the State and/or without acquiring
formal approval for conversion.
Individual peasants may also violate land laws either by directly converting
agricultural land to residential and other non-agricultural purposes or transferring land
use rights to other non-agricultural users. The illegal conversion of land by peasants
is driven by profits, especially in comparison with the returns from farming and other
agricultural activities. In Shenzhen, for instance, villagers started building private
houses and apartments to meet the housing demands of migrant workers from the
1980s. Rental income of villagers was estimated to be between 4,000 to 7,000 million
yuan per year.
21
The motivations for peasants are, however, beyond the scope of this
thesis, which focuses on explaining motivations for local state agents.
The Evolution of China’s Land Management System
Under Deng Xiaoping’s leadership in the late 1970s, China embarked on a series of
economic and political reforms with far-reaching consequences. The adoption of the

open-door policy, the promotion of rural industrialization and private
entrepreneurship, and the decollectivization of agriculture had transformed China’s
economy. Although reform was accompanied by a new set of problems including
20
“Guotubu dui shiliu chengshi jiance” (“The MLR monitors 16 cities”).
21
See Wang Ruyuan, “Shenzhen tequ chengzhongcun tudi shouyi de lilun tantao” (“Land proceeds in
Shenzhen’s villages-in-city: a theoretical analysis”), Guotu jingji (China Land Economy), No. 11 (2003),
pp. 17-18; Tan Gang, “Chengzhongcun jingji zhuti, jingji huodong ji zhuyao tezheng” (“The economic
entity, activity and characteristics of villages-in-city”), Kaifang daobao (Open Economy Herald), No. 3
(2005), pp. 51-56.
Yew Chiew Ping
7
Chapter One
Introduction
corruption and regional inequality, China achieved remarkable growth. Within a
decade from 1978 to 1988, real GDP per capita more than doubled.
22
Along with rapid economic development was the evolution of China’s land use
trends. Reforms unleashed the pent-up demand for better infrastructure, housing and
other modern amenities that led to the widespread conversion of agricultural land for
construction purposes. In the 1980s, industries and warehouses occupied as much
as 30 percent of the area in Chinese cities and rural industries in the form of
township and village enterprises (TVEs) took land extensively in the countryside. The
rapid expansion of roads also depleted large areas of agricultural land, particularly in
eastern China where population density was high and the economy was fast
growing.
23

The extensive conversion of land to non-agricultural use brought with it a host of

problems such as duplicate construction, idle land, and burgeoning local extra-
budgetary funds that resulted in the loss of revenue accruing to the Centre. In the
reform era, the misuse and loss of agricultural land to construction prompted the
central government to circulate several notices and promulgate new rules to tighten
land management. Capital construction (jiben jianshe), TVEs and village collectives
were highlighted as responsible for taking most of the agricultural land, often
unlawfully.
24
This observation is affirmed by statistics on the land taken for non-
agricultural purposes in Guangdong from 1987 to 1995, which show that an average
of more than 60 percent were used for national construction projects and more than
22
Kenneth Lieberthal, Governing China: From Revolution Through Reform (New York & London: W. W.
Norton & Company, 2004), pp. 129.
23
Samuel P. S. Ho and George C. S. Lin, “Non-Agricultural Land Use in Post-Reform China,” China
Quarterly, No. 179 (2004), pp. 762-65.
24
Zhongfa document no. 7 (1986), “Zhonggong Zhongyang, Guowuyuan guanyu jiaqiang tudi guanli,
zhizhi luanzhan gengdi de tongzhi” (“Notice from the Party Central Committee and the State Council on
strengthening control on land and stopping the indiscriminate taking of cultivated land”).
Yew Chiew Ping
8
Chapter One
Introduction
20 percent for township and village collective construction, whereas less than 10
percent were taken by the building of rural housing.
25

While the demands of urbanization triggered by the reforms were driving land use

conversion at the macro-level, the institutional contexts in the first decade of the
reform era and that from 1988 onwards are different, thereby influencing the set of
incentives and constraints that structure cadres’ behaviour in the process of land use
change. Prior to 1988, state-owned land was allocated to local users at virtually no
cost whereas local-foreign joint-ventures paid an annual fee of five yuan to 300 yuan
per square metre for the use of site (changdi shiyongfei).
26
In 1988, the Constitution
of the PRC and the Land Administrative Law were amended to legalize the paid
transfer of land use rights.
27
Furthermore, the collection of land use tax in cities and
town was implemented in the same year, superseding the collection of the land use
fee.
28
Payment for the use of urban land was not fully implemented till 1988 although
advocacy for doing so began in the early 1980s.
29

The Land Administration Law provides the basic legal framework governing China’s
land system. Enacted in 1986, the Land Administration Law was revised in 1988,
1998 and underwent minor amendments more recently on 28 August 2004, at the
11
th
Meeting of the Standing Committee of the 10
th
National People’s Congress.
30
The
25

Guangdong dizheng dichan nianjian 1996 (Yearbook of Guangdong Land Governance and Land
Resources 1996) (Guangdongsheng ditu chubanshe, 1996), pp. 278-79.
26
Guofa document no. 201 (1980), “Guowuyuan guanyu zhongwai heying qiye jianshe yongdi de
zanxing guiding” (“The State Council’s provisional regulations on the use of construction land by sino-
foreign joint ventures”); See also Zhu Jieming, “Local Growth Coalition: The Context and Implications of
China’s Gradualist Urban Land Reform,” International Journal of Urban and Regional Research, Vol. 23,
No. 3 (1999), pp. 534-48.
27
Refer to the 1988 Land Administration Law, Article 2; Zhang Chuanjiu, “Shouwang dadi 20 nian”
(“Watching over the land for 20 years”), Zhongguo tudi (China Land), No. 6 (2006), pp. 4-8.
28
“Zhonghua renmin gongheguo xianfa xiuzhengan” (“Amendment to the Constitution of the PRC”),
1988; Guofa document no. 17 (1988), “Zhonghua renmin gongheguo chengzhen tudi shiyongshui
zanxing tiaoli” (“The PRC’s Provisional regulations on land use tax in cities and towns”).
29
Anthony Gar-On Yeh and Wu Fulong, “The New Land Development Process and Urban Development
in Chinese Cities,” International Journal of Urban and Regional Research, Vol. 20, No. 2 (1996), pp.
334-35.
30
The 2004 amendments involve changing the Chinese term for requisition from “zhengyong” to
“zhengshou.” For the reasons behind this change, refer to Sun Xiaohong, “Xi tudi ‘zhengshou’ yu
‘zhengyong’” (“An analysis of the ‘zhengshou’ and ‘zhengyong’ of land”), Zhejiang guotu ziyuan
Yew Chiew Ping
9
Chapter One
Introduction
Land Administration Law that exists today took shape in 1998. Among the main
changes were the imposition of the land use plan from top-down; the classification of
land into agricultural, construction and unused land and an approval system for the

conversion of agricultural land; and the upward concentration of approval authority
for land requisition into the hands of the central and provincial governments.
31

Today, the existing law contains eight Chapters and 86 Articles codifying land
ownership and land use rights, land use plan, protection of cultivated land, land used
for construction, supervision and inspection of land use and so on.
32
The leading
government agency overseeing land management is the Ministry of Land and
Resources (MLR), established in 1998 through the merger of the former State
Bureau of Land Administration, the State Oceanic Administration, the State Bureau of
Survey and Mapping, and the Ministry of Geology and Mineral Resources.
33
Both the Land Administration Law and the former State Bureau of Land
Administration were established in response to the alarming rate at which cultivated
land was disappearing in the 1980s. From 1980 to 1985, around 37 million mu of
cultivated land were lost nationwide, with rate of disappearance peaking at over 15
million mu in 1985.
34
Massive land enclosure occurred after Deng Xiaoping’s
southern tour in 1992, which led to the development zone and real estate fever.
35
So
(Zhejiang Land and Resources), No. 10 (2004), pp. 48-49; Wang Zhenzhong and Wang Kai, “Qianyi tudi
zhengshou yu zhengyong zhidu” (“A preliminary discussion of the zhengshou and zhengyong of land”),
Henan guotu ziyuan (Henan Land and Resources), No. 2 (2006), pp. 16-17.
31
“Zhonghua renmin gongheguo tudi guanlifa” (“The Land Administration Law of the PRC”), revised on
29 December 1988, Zhonghua renmin gongheguo guowuyuan gongbao (The PRC State Council’s

Gazette), No. 27 (1988), pp. 873-82; Mao Donglin, “Weile women de shengmingxian – ‘tudi guanlifa’
xiugai pingshu” (“For the sake of our lifeline – Assessing the revision of the ‘Land Administration Law’”),
Kuangchan ziyuan kaifa (Mineral Resources Exploitation), No. 10 (1998), pp. 15-17; Zhu Daolin, “Falü,
wei tudi shichang huhang” (“Safeguarding the land market with law”), Zhongguo tudi (China Land), No.
6 (2006), pp. 9-10.
32
Refer to the Land Administration Law. For more information on the evolution of China’s land system,
see Ding Chengri, “Land Policy Reform in China: Assessment and Prospects,” Land Use Policy, Vol. 20,
No. 2 (2003), pp. 110-13.
33
The State Bureau of Land Administration was set up a month after the promulgation of the Land
Administration Law in 1988. See Zhang Chuanjiu, “Shouwang dadi,” pp. 5.
34
See Zhang Chuanjiu, “Shouwang dadi,” pp. 4.
35
Zhang Xiaojing and Sun Tao, “China’s Current Real Estate Cycle and Potential Financial Risks,”
China & World Economy, Vol. 14, No. 4 (2006), pp. 59-60; Carolyn Cartier, “‘Zone Fever’, the Arable
Yew Chiew Ping
10
Chapter One
Introduction
far, the State had taken drastic measures in the form of moratoriums to arrest the
loss of cultivated land. On 20 May 1997, a moratorium on non-agricultural
construction taking up cultivated land was imposed and its one year duration was
subsequently extended in 1998 till the revision of the Land Administration Law was
complete.
36

However, not long after the tightening of control over the approval of land use
conversion, land requisition and others in the revised law, the area of arable land

used for construction began to rise again, soaring to 3.4 million mu in 2003 from 2.4
million mu in 2000.
37
From 2001 to 2005, the area of arable land decreased by 92.4
million mu at an annual depletion rate of 18.48 million mu.
38
On 18 July 2003, the
State Council issued a notice to suspend the approval of all development zones,
together with complementary measures to remove illegal development zones.
39
For
half a year till November 2004, all approval for the conversion of agricultural land to
construction land was also shelved.
40
Yet again, presumably due to the pent-up
demand for land use conversion whilst the moratorium was in effect, the arable land
used for construction picked up with a vengeance after the ban was lifted, rising over
Land Debate, and Real Estate Speculation: China’s Evolving Land Use Regime and Its Geographical
Contradictions,” Journal of Contemporary China, Vol. 10, No. 28 (2001), pp. 468; Zhang Chuanjiu,
“Shouwang dadi,” pp. 6.
36
Guojia tudi guanli ju and Guojia jihua weiyuanhui, document no. 6 (1997), “Dongjie feinongye jianshe
xiangmu zhanyong gengdi guiding” (“The regulation on freezing the taking of arable land for non-
agricultural construction items”); “Guojia jiang jixu dongjie feinong jianshe zhanyong gengdi” (“The State
to continue the moratorium on the taking of arable land for non-agricultural construction”), Xin nongcun
(New Village), No. 5 (1998), pp. 2; “1998: tudi guanli dashiji” (“1998: major events in land
management”), Renmin ribao (Peoples’ Daily), 26 June 1998, pp. 9.
37
“Zhongguo guotu ziyuan gongbao” (“China’s national land resources bulletin”), 2001-2006, Zhonghua
renmin gongheguo guotu ziyuan bu (The Ministry of Land and Resources P.R.C.),

, accessed 2 December 2007.
38
Zhang Chuanjiu, “Shouwang dadi,” pp. 7.
39
Guoban faming dian document no. 30 (2003), “Guowuyuan bangongting guanyu zanting shenpi gelei
kaifaqu de jinji tongzhi” (“An emergency notice from the State Council on the temporary freeze on the
approval for all types of development zones”); Guotuzifa no. 45 (2003), “Guotu ziyuanbu guanyu qingli
gelei yuanqu yongdi, jiaqiang tudi gongying tiaokong de jinji tongzhi” (“The MLR’s emergency notice
regarding the cleaning up of all types of zones and strengthening control over land supply”); Fagaiwaizi
document no. 2343 (2003), “Guotu ziyuanbu guanyu qingli zhengdun xianyou gelei kaifaqu de juti
biaozhun he zhengce jiexian” (“The MLR on specifications and policy limits on the administration and
restructuring of all existing development zones”).
40
Guoban faming dian document no. 20 (2004), “Guowuyuan bangongting guanyu shenru kaizhan tudi
shicahng zhili zhengdun yange tudi guanli de jinji tongzhi” (“An emergency notice from the State Council
on deepening the administration and restructuring of the land market and tightening land management”).
Yew Chiew Ping
11
Chapter One
Introduction
70 percent from 2.2 million mu in 2004 to 3.9 million mu in 2006.
41
From 2007, the
provincial government has taken on the responsibility of auditing all requests for the
conversion of agricultural land and land requisition under their jurisdiction before
submitting them for the State Council’s approval.
42
The arable land taken for
construction subsequently declined to 2.82 million mu in 2007, rising slightly to 2.87
million mu in 2008 (see Figure 1.2).

43
Figure 1.2 Trends in China’s Non-Agricultural Land Use
6866
2053
2037
1568
2.08
3.88
2.46
2.95
3.43
2.18
2.82
2.87
0
1000
2000
3000
4000
5000
6000
7000
8000
2001 2002 2003 2004 2005 2006 2007 2008
0
0.5
1
1.5
2
2.5

3
3.5
4
4.5
No. of Developm ent Zones
Arable Land Occupied for Construction (m illion m u)
Sources: “Zhongguo guotu ziyuan gongbao” (“China’s national land resources bulletin”), 2001-2008,
Zhonghua renmin gongheguo guotu ziyuan bu (The Ministry of Land and Resources P.R.C.),
, accessed on various dates; Zhang Pu and Li Xiaowen, “Fangzhi kaifaqu weifa
quandi xinsikao” (New thoughts on preventing illegal land enclosures by development zones),
Zhongguo tudi (China Land), No. 2 (2007), pp. 15; “Guojia fazhan gaigewei quanwei jiedu kaifaqu qingli
zhengdun gongzuo” (“The State Development and Reform Committee’s authoritative interpretation of
the reduction and restructuring of development zones”), Zhongguo touzi (China Investment), No. 5
(2007), pp. 20.
41
“Zhongguo guotu ziyuan gongbao”; Guotuzifa document no. 45 (2003), “Guotu ziyuanbu guanyu qingli
gelei yuanqu yongdi, jiaqiang tudi gongying tiaokong de jinji tongzhi” (“The MLR’s emergency notice
regarding the cleaning up of all types of zones and strengthening control over land supply”). The
moratorium on the approval of land use in State-level development zones was subsequently lifted in
2005. See Guobanfa document no. 15 (2005), “Guowuyuan bangongting zhuanfa shangwubu deng
bumen guanyu cujin guojiaji jingji jishu kaifaqu jinyibu tigao fazhan shuiping ruogan yijian de tongzhi” (“A
State Council Office’s notice on the circulation of some suggestions by the Ministry of Commerce and
others on advancing the development of State-level economic technology development zones”).
42
Guotuzifa document no. 320 (2006), ‘Guanyu tiaozheng bao Guowuyuan pizhun chengshi jianshe
yongdi shenpi fangshi youguan wenti de tongzhi” (“A notice on the issues related to the adjustment of
the verification method for urban construction land to be submitted to the State Council for approval”).
43
Zhongguo guotu ziyuan gongbao.”.
Yew Chiew Ping

12
Chapter One
Introduction
Table 1.1 Chronology of Events in China’s Land Management
44
1980-1985
• Loss of around 36.8 million mu of arable land
1986
• Enactment of the Land Administration Law (LAL)
• Establishment of the State Bureau of Land Administration
1987
• The first paid conveyance of land use rights took place in Shenzhen
1988
• Amendment of the Constitution of the PRC to legalize the paid transfer of land use
rights
• Amendment of the LAL to legalize the paid transfer of land use rights
• Implementation of the collection of land use tax in cities and town, superseding the
collection of the land use fee
1990-1996
• Loss of 72.77 million mu of arable land
1990
• Enactment of new legislation to legalize the secondary transfer of land use rights
of state-owned land in towns and townships and that by foreign investors
1992
• There were 1,951 development zones all over China with a total planned area of
15,300 square kilometres
1992
• The State Council issued an urgent notice to stop the indiscriminate encroachment
and use of arable land
1993

• Enactment of “provisional rules on the levy of land appreciation tax on the profits
from the transfer of land use rights and buildings and other attachments on land”
1997
• There were 4,210 development zones in China with a total planned area of 12,400
square kilometres
1997
• Imposition of a moratorium on non-agricultural construction taking up cultivated
land
1998
• Extension of the 1997 moratorium
• Amendment of the LAL
• Establishment of the Ministry of Land and Resources (MLR)
2001-2005
• 13.1 million mu of arable land were taken for construction purposes
2003
• The number of development zones in China hit 6,866
2003
• Imposition of a moratorium on the approval of all development zones, together
with complementary measures to remove illegal development zones
2004-2006
• The number of development zones fell from 2,053 to 1,568
2004
• Amendment of the LAL
• Imposition of a moratorium on the conversion of agricultural land for non-
agricultural construction from April to November
• The MLR issued specific guidelines on the restructuring of development zones
2005
• Moratorium lifted for State-level development zones
2006
• Arable land taken for construction purposes soars to 3.88 million mu from 2.08

million mu in the previous year
2006
• Provincial governments delegated with greater responsibility in auditing requests
for the conversion of agricultural land and land requisition under their jurisdiction
2007
• Arable land taken for construction purposes fell to 2.82 million mu
Significance
The choice of research topic is justified in a few respects. Firstly, the significance of
land use in China is self-evident with regard to the scarcity of land. Despite having
the third largest land mass in the world, China’s land per capita is but a third of the
world’s average.
45
How land is managed to mitigate the consequences of its scarcity
44
For the data on arable land loss and the number of development zones, refer to Zhang Chuanjiu,
“Shouwang dadi,” pp. 4; Lin and Ho, “China’s Land Resources,” pp. 96; “Zhongguo guotu ziyuan
gongbao,” 2001-2005; Zhang Pu and Li Xiaowen, “Fangzhi kaifaqu,” pp. 15; “Guojia fazhan gaigewei,”
pp. 20; “Zhongguo kaifaqu fenbu tubiao” (“The distribution of development zones in China”), MLR
website, , accessed 14 June 2008. For other sources, refer to footnotes 26 to 42 in
this chapter.
45
“Woguo tudi jiadi zhi duoshao?”
Yew Chiew Ping
13
Chapter One
Introduction
is therefore critical. Some propose that, in contrast to highly mobile labour and
capital, land is the sole basic factor of production that still remains under the socialist
state’s control in today’s globalized context.
46

Yet evidence suggests that this control
is constantly being challenged, and that the fragmented Chinese state is grappling to
rein in the misuse of her most valuable asset by her agents. As later parts of this
thesis shall demonstrate, indiscriminate land use conversion has led to duplicate
construction, reckless industrialization, arbitrary city expansion and large areas of
idle land.
47
Studies have also shown that a reduction in arable land area does not
necessarily lead to GDP growth, pointing to the questionable efficacy of land use.
48
Understanding the motivations behind local governments’ zealous pursuit of land
development is thus key to arresting the trend in indiscriminate and irresponsible land
use conversion.
Secondly, the rural community, which makes up 57 percent of China’s population, is
at the receiving and losing end of land use change and land expropriation.
49
From the
mid-1990s, China’s investment-driven urbanization and industrialization have
displaced large numbers of rural residents from the periphery of cities and industrial
locations.
50
“Since much of the land for urban expansion has actually been acquired
from the countryside,” argue Lin and Ho, “it would not be possible to understand the
complex processes of land development without a close scrutiny of how land is taken
46
George C. S. Lin and Samuel P. S. Ho, “The State, Land System, and Land Development Processes
in Contemporary China.” Annals of the Association of American Geographers, Vol. 95, No. 2 (2005), pp.
413.
47
See Yang Dali, Book Review, American Political Science Review, Vol. 94, No. 2 (2000), pp. 491; Xing

Yuzhong, “Zhizhi chongfu jianshe, dujue mangmu yongdi” (“Curb duplicate construction and eliminate
indiscriminate use of land”), Zhongguo tudi (China Land), No. 4 (1999), pp. 25-27; Cartier, “‘Zone
Fever’,” pp. 454-57; Zhou Wenshui, “‘Zhengji gongcheng’ la chengzhen jianshe ‘xiashui’” (“‘Showcases
of political achievement’ extend to the building of cities and towns”), Shidai chao (Trend of the Time),
No. 2 (2003), pp. 34-35.
48
Chen Baiming and Du Hongliang, “Shilun gengdi zhanyong yu GDP zengzhang de tuogou yanjiu” (“A
decoupling study on arable land occupation and GDP growth),” Ziyuan kexue (Resource Science), Vol.
28, No. 5 (2006), pp. 36-42; Tan Rong, Qu Futian, and Guo Zhongxing, “Zhongguo gengdi feinonghua
dui jingji zengzhang gongxian de diqu chayi fenxi” (“The conversion of agricultural land and its
contribution to economic growth in China: an analysis of regional disparity),” Changjiang liuyu ziyuan yu
huanjing (Resources and Environment in the Yangtze Basin), Vol. 14, No. 3 (2005), pp. 277-81.
49
Zhongguo tongji nianjian 2006 (China Statistical Yearbook 2006), Li Xiaochao et al. (eds.), (Zhongguo
tongji chubanshe, 2006), pp. 99.
50
Liu Mingxing et al., “Instrumental Land Use,” pp. 313-14.
Yew Chiew Ping
14
Chapter One
Introduction
away from the rural collective at low cost for high-value urban development.”
51
Indeed, the urban-rural disparity in land value has encouraged opportunistic and
predatory behaviour towards the politically weak peasants. As local governments
resort to land sales to finance urban infrastructure, the requisition of rural land at low
cost has become an easy and vital means for them to amass land for sale.
52
Land
expropriation, compensation and related issues, which often involve a direct conflict

of interests between local state actors and peasants, have become the main reasons
for villagers’ appeals and complaints to higher authorities.
53
Considering China’s
large rural population and growing numbers of “landless farmers,” estimated to be
around 50 to 60 million, the impact of land use change and land expropriation on
rural stability is surely worth looking into.
54
Case Study and Selection Bias
In seeking answers, this study draws on existing theories and empirical evidence
from Western and Chinese literature on the subject, supplemented by the author’s
fieldwork in Sihui, located in Zhaoqing of the Guangdong province.
Guangdong is chosen as the site of this study for several reasons. According to the
1996 national land survey, the conversion of agricultural land to non-agricultural use
in the 1990s was concentrated in eastern and central China, especially the eastern
coastal region which occupies less than ten percent of China’s land area but has
disproportionately large areas of arable land and non-agricultural land at 22 percent
51
Lin and Ho, “The State, Land System”, pp. 414.
52
George E. Peterson, “Land Leasing and Land Sale as an Infrastructure-Financing Option,” World
Bank Policy Research Working Paper 4043, 2006, The World Bank, ,
accessed 12 February 2008.
53
Zhang Shi, “Qunzhong xinfang huodong de tedian ji qi fenxi” (“Characteristics and analysis of the
public's appeal activity”), Guangzhou shehui zhuyi xueyuan xuebao (Journal of Guangzhou Institute of
Socialism), No. 4 (2004), pp. 17-19; Ji Zhongji, “Nongcun xinfang jubao duo de yuanyin ji duice”
(“Reasons and solutions for the high numbers of village appeals and reports”), Zhongguo jiancha (China
Surveillance), No. 6 (2005), pp. 26; Lu Ying and Hu Hao, “Shedi xinfang anjian de tedian ji chuli cuoshi”
(“The characteristics and measures in dealing with land related appeals”), Guotu ziyuan (Land and

Resources), No. 5 (2005), pp. 38-39.
54
Liao Xiaojun, Zhongguo shidi nongmin yanjiu (Research on China's Landless Farmers) (Beijing:
Shehui kexue wenxian chubanshe, 2005), pp. 98-99.
Yew Chiew Ping
15
Chapter One
Introduction
and 39 percent respectively.
55
In contrast, agricultural land had expanded through the
conversion of unused land in western China over the same period.
56
Table 1.2 Land Use in China by Region in 1996 (hectares)
Total Agricultural Land
Cultivated
Land
Non-
Agricultural
Land
Water Area Unused
Land
China 950,676,195 633,736,518 130,039,229 29,542,982 42,308,827 245,087,868
East 131,890,053 93,419,224 36,955,888 11,001,852 11,775,492 15,693,485
Central 281,590,107 222,432,293 56,118,890 11,754,037 13,908,260 33,495,517
West 537,196,036 317,885,001 36,964,452 6,787,093 16,625,075 195,898,867
Source: Lin and Ho, “China’s Land Resources,” pp. 96, citing from Liu Y. (ed.), Zhongguo tudi ziyuan
diaochu shujuji (Compilation of results from the survey of China’s land resources) (Quanguo tudi ziyuan
diaocha bangongshi, Beijing, 2000).
The trends described above also means that tension between farming and non-

agricultural land use is high in the eastern coast, as attested to by the situation in
Guangdong.
57
The magnitude and growth of both land use conversion and land
expropriation in Guangdong underscores the far-reaching impact and repercussions
of these land processes. Figure 1.3 depicts the loss of arable land to non-agricultural
construction in Guangdong in the decade prior to 2000. Guangdong was also one of
the provinces that requisitioned the greatest area of land in 2004 and 2005.
58
Table
1.3 shows the area of land expropriated by various Guangdong prefectures from
2004 to 2006. The total area of land expropriated in Guangdong nearly trebled from
2004 to 2005. A number of prefectures at varying levels of development from a GDP
per capita of around 5,000 yuan to over 70,000 yuan – Shaoguan, Shantou,
Zhaoqing, Shanwei, Heyuan, Dongguan and Zhongshan – saw a staggering growth
55
Ho and Lin, “Non-Agricultural Land Use,” pp. 760. The east coast refers to Beijing, Tianjin, Hebei,
Shandong, Shanghai, Jiangsu, Zhejiang, Fujian, Guangdong, and Hainan but excludes the northeastern
provinces of Liaoning, Jilin and Heilongjiang.
56
Western China, which encompasses Guangxi, Sichuan, Guizhou, Yunnan, Tibet, Gansu, Qinghai,
Ningxia and Xinjiang, had seen an increase in agricultural land accompanying a decline in unused land
in the 1990s. Concurrently, there was also an increase in non-agricultural land in the west. The central
concern of this thesis, i.e. the conversion of agricultural land to non-agricultural use, at first glance, may
appear to be of little relevance to western China. However, because the actual conversion between land
types is not known, the increase in non-agricultural land cannot be wholly attributed to direct conversion
from unused land. This means that the possibility of using unused land to replace agricultural land that
had been converted to non-agricultural use cannot be ruled out. Refer to Ho and Lin, “Non-Agricultural
Land Use,” pp. 761.
57

China’s diversity notwithstanding, Guangdong’s land use pattern has been quite similar to that of other
coastal provinces. Refer to Ho and Lin, “Non-Agricultural Land Use,” pp. 772-73.
58
Zhongguo tongji nianjian 2005 (China Statistical Yearbook 2005), Zheng Jingping et al. (eds.),
(Zhongguo tongji chubanshe, 2005), pp. 381; Zhongguo tongji nianjian 2006, pp. 396.
Yew Chiew Ping
16
Chapter One
Introduction
in the area of land expropriated in 2005 from the previous years.
59
Over the period of
2004-2006, 18,416 hectares of agricultural land were lost, of which 7,386 hectares or
40 percent were arable land. In the process, 274,911 peasants were resettled.
60
The
scale of land use change and land expropriation in Guangdong makes it an ideal site
for investigating how agricultural land has been taken away from peasants to meet
the needs of local governments.
Figure 1.3 Loss of Cultivated Land to Non-Agricultural Construction in
Guangdong (hectares)
Sources: Guangdong dizheng dichan nianjian 1996, pp. 278-79; Guangdong dizheng dichan nianjian
1999, pp. 366-67; Guangdong guotu ziyuan nianjian 2000, pp. 277.
59
For the GDP levels of Guangdong’s prefectures, refer to Guangdong tongji nianjian 2005 (Guangdong
Statistical Yearbook 2005), Pu Xinmin et al. (eds.), (Beijing: Zhongguo tongji chubanshe, 2005), pp. 87.
Curiously, the 2004 national moratorium on land use change approval did not seem to have slowed
down the rate of land expropriation in some localities such as Foshan, Zhanjiang, Chaozhou and
Jieyang. Refer to the statistics in Guangdong guotu ziyuan nianjian 2005 (Guangdong Land Resources
Yearbook 2005), Lin Haokun et al. (eds.), (Guangdongsheng ditu chubanshe, 2005), pp. 358;

Guangdong guotu ziyuan nianjian 2006 (Guangdong Land Resources Yearbook 2006), Lin Haokun et
al. (eds.), (Guangdongsheng ditu chubanshe, 2006), pp. 427; Guangdong guotu ziyuan nianjian 2007
(Guangdong Land Resources Yearbook 2007), (Guangdongsheng ditu chubanshe, 2007), pp. 497.
60
Guangdong guotu ziyuan nianjian 2005, pp. 358; Guangdong guotu ziyuan nianjian 2006, pp. 427;
Guangdong guotu ziyuan nianjian 2007, pp. 497.
Yew Chiew Ping
17
0
2000
4000
6000
8000
10000
12000
14000
16000
18000
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1997
1998

1999
Chapter One
Introduction
Table 1.3 Land Expropriated in Guangdong
61
(hectares)
2004 2005 2006
Total Land
Expropriated
Agricultural
Land
Cultivated
Land
Total Land
Expropriated
Agricultural
Land
Cultivated
Land
Total Land
Expropriated
Agricultural
Land
Cultivated
Land
GUANGDONG 4218.49 3457.89 1482.92 11730.76 9736.02 3543.83 6415.79 5222.37 2359.24
Guangzhou 1008.45 823.88 422.38 1860.63 1633.74 605.71 779.89 699.66 333.00
Shaoguan 27.23 26.12 19.25 253.01 227.21 126.56 160.33 151.39 98.94
Shantou 0.46 0.01 0 18.28 11.98 11.98 5.23 5.19 5.19
Foshan 677.23 590.28 187.90 529.28 467.20 168.00 355.39 309.39 70.68

Jiangmen 164.47 120.64 26.96 56.24 9.13 5.37 68.51 64.80 31.62
Zhanjiang 80.76 54.96 36.93 38.41 27.58 7.14 43.86 16.68 12.77
Maoming 13.65 13.65 6.36 71.28 68.95 24.54 50.87 35.39 7.06
Zhaoqing 1.92 1.88 1.55 116 100.97 54.02 82.78 81.69 43.80
Huizhou 249.49 240.96 54.23 340.22 277.61 117.36 307.76 241.64 83.54
Meizhou 175.95 96.81 67.36 295.77 254.86 137.11 101.51 97.50 86.12
Shanwei 5.84 5.84 0 98.22 73.32 61.04 58.93 35.49 32.68
Heyuan 6.05 4.99 3.65 34.16 21.16 19.51 219.66 173.58 120.97
Yangjiang 182.38 120.79 54.95 327.69 167.35 94.49 364.33 291.63 213.63
Qingyuan 132.08 114.50 106.22 379.85 268.64 149.12 134.90 118.53 48.42
Dongguan 904.58 709.26 132.56 2601.8 1855.17 338.13 1855.29 1305.84 237.82
Zhongshan 246.88 236.19 133.92 639.92 604.79 420.10 573.37 508.58 401.14
Chaozhou 77.7 65.10 40.01 34.67 34.64 22.91 105.05 102.41 81.77
Jieyang 145.92 127.79 117.25 41.07 14.87 13.65 67.49 64.81 58.57
Yunfu 117.45 106.24 71.44 230.69 204.60 87.51 145.09 137.77 54.59
Approved by the State
Council
0 0 0 3763.57 3412.25 1079.58 935.54 780.40 336.92
Sources: Guangdong guotu ziyuan nianjian 2005, pp. 358; Guangdong guotu ziyuan nianjian 2006, pp. 427; Guangdong guotu ziyuan nianjian 2007, pp. 497.
61
Excluding Shenzhen and Zhuhai.
Yew Chiew Ping
18
Chapter One
Introduction
Since the author’s fieldwork was carried out in Guangdong, one of the most affluent
provinces, the study does not claim that its findings can be generalized to all of
China. Biases may stem mainly from Guangdong’s land use distribution, its high level
of urbanization and economic development in comparison to the provinces in central
and western China (see Table 1.4), and how these interact with local officials’

incentives for converting agricultural land.
Table 1.4 Gross Regional Product and Urbanization Level by Province
Region Gross Regional Product
(100 million yuan) in 2006
Urbanization Level
(%) in 2000
Beijing 7870.28 77.55
Tianjin 4359.15 71.99
Hebei 11660.43 26.33
Shanxi 4752.54 35.21
Inner Mongolia 4791.48 42.70
Liaoning 9251.15 54.91
Jilin 4275.12 49.66
Heilongjiang 6188.90 51.53
Shanghai 10366.37 88.31
Jiangsu 21645.08 42.25
Zhejiang 15742.51 48.67
Anhui 6148.73 26.72
Fujian 7614.55 41.96
Jiangxi 4670.53 27.69
Shandong 22077.36 38.15
Henan 12495.97 23.44
Hubei 7581.32 40.48
Hunan 7568.89 27.50
Guangdong 26204.47 55.66
Guangxi 4828.51 28.16
Hainan 1052.85 40.68
Chongqing 3491.57 33.09
Sichuan 8637.81 27.09
Guizhou 2282.00 23.96

Yunnan 4006.72 23.38
Tibet 291.01 19.43
Shaanxi 4523.74 32.15
Gansu 2276.70 23.95
Qinghai 641.58 32.34
Ningxia 710.76 32.44
Xinjiang 3045.26 33.84
Sources: Zhongguo tongji nianjian 2007 (China Statistical Yearbook 2007), Li Xiaochao et al. (eds.),
(Zhongguo tongji chubanshe, 2007), pp. 68; Shen Jianfa, “Estimating Urbanization Levels,” pp. 100.
As mentioned earlier, in comparison to central and western China, eastern coastal
provinces have disproportionately large areas of arable land and non-agricultural
land.
62
Officials in eastern cities, therefore, have less unused and other agricultural
land to tap on for construction purposes. Since large areas of land have already been
62
Ho and Lin, “Non-Agricultural Land Use,” pp. 760.
Yew Chiew Ping
19
Chapter One
Introduction
used for non-agricultural purposes and arable land is under strict protection, this
means that future supply of land for construction is relatively scarce.
Furthermore, demand for non-agricultural land in the coastal region is higher. Figure
1.4 depicts the loss of cultivated land by cause and regions in 1994. The decline in
cultivated to construction purposes – state construction, collective construction and
rural housing – ranged from 30 percent in the east, to 12 percent in central China and
11 percent in the west. Figures 1.5 and 1.6 also provide more current evidence of a
higher demand for non-agricultural land in the east than in other regions. In addition,
the area of land requisitioned by the State in different regions may also serve as a

rough gauge. In 2006, for example, the average areas of land requisitioned in the
east coast and the west were 94.3 square kilometres and 22.4 square kilometres
respectively.
63

Figure 1.4 Decline in Cultivated Land (hectares) in 1994 by Cause and Region
East China
a
52425
22%
99304
40%
74028
30%
13821
6%
4075
2%
Central China
b
22895
7%
265904
76%
41599
12%
14012
4%
3718
1%

63
Zhongguo tongji nianjian 2007, pp. 396.
Yew Chiew Ping
20
Chapter One
Introduction
West China
c
14474
7%
145917
76%
25344
13%
3787
2%
3933
2%
State cons truction Colle ctive cons truction
Rural Housing Other agricultural use
Natur al dis as ter
Source: Lin and Ho, “China’s Land Resources,” pp. 103.
a
Liaoning, Beijing, Tianjin, Hebei, Shandong, Jiangsu, Shanghai, Zhejiang, Fujian, Guangdong, Hainan,
Guangxi
b
Heilongjiang, Jilin, Inner Mongolia, Shanxi, Henan, Anhui, Jiangxi, Hubei, Hunan
c
Sichuan (including Chongqing), Guizhou, Yunnan, Qinghai, Tibet, Shaanxi, Ningxia, Ganxu, Xinjiang
Figure 1.5 Conveyance of Land by Region (%), 2008

East, 51.3
We s t, 23.5
Ce ntr al, 25.2
Source: “Zhongguo guotu ziyuan gongbao,” 2008.
Figure 1.6 Approved Use of Land for Construction by Region (%), 2008
East, 40
West, 30.7
Central,
29.3
Source: “Zhongguo guotu ziyuan gongbao,” 2008.
Yew Chiew Ping
21
Chapter One
Introduction
Greater demand for land in coastal China may be attributed to a few factors. For one,
new construction land is necessary to accommodate its growing urban population.
64
An estimation of rural-urban migrants at the end of 1998 reveals that 81 percent of all
migrants come from inland areas, mostly relocating to other provinces in the coastal
region.
65
Moreover, land is desired by government officials for city-building and for
the substantial earnings from land leasing. A comparison of land prices in three cities
in Jiangsu, Anhui and Sichuan, for instance, shows that commercial and industrial
land commands the highest price in coastal Jiangsu at an average of 356 yuan per
square metre whereas that in Sichuan is 143 yuan per square metre.
66
Lastly, there
is also greater demand for land from commercial and industrial land users because of
the competitive advantages of coastal provinces, such as better infrastructure and

system of transportation etc.
67

The ways in which the aforementioned factors may interact with officials’ cost-benefit
calculations in supplying land for conversion throw up further questions. For instance,
does the relative shortage of land, coupled with higher demand and land prices,
intensify illegal land use conversion in coastal provinces such as Guangdong?
Conversely, do local governments exercise greater restraint and prudence in land
conversion and development because of the higher opportunity costs? What is the
relationship between land leasing and the availability of other revenue sources?
64
Rural-urban migration is the dominant source of urban population growth in China from 1978-1999.
See Kevin Zhang Honglin and Song Shunfeng, “Rural-Urban Migration and Urbanization in China:
Evidence from Time-Series and Cross-Section Analyses,” China Economic Review, Vol. 14 (2003), pp.
390.
65
Kevin Zhang Honglin and Song Shunfeng, “Rural-Urban Migration,” pp. 389-91.
66
Wang Xiaoying, He Mingyu and Gao Yong, “Woguo nongdi zhuanyong zhong de tudi shouyi fenpei
shizheng yanjiu” (“An Analysis of the Distribution of Land Proceeds in the Conversion of Agricultural
Land for Construction in China”), Rural Development Institute, Chinese Academy of Social Sciences,
available at , accessed 6 February 2007.
67
Zou Wei, Zhang Fen and Zhuang Ziyin and Song Hairong, “Transport Infrastructure, Growth, and
Poverty Alleviation: Empirical Analysis of China,” Annals of Economics and Finance, Vol. 9, No. 2
(2008), pp. 345-71; Sylvie Démurger, “Infrastructure Development and Economic Growth: An
Explanation for Regional Disparities in China?” Journal of Comparative Economics, Vol. 25 (2001), pp.
95-117.
Yew Chiew Ping
22

Chapter One
Introduction
Taking the above factors into consideration, the scenario for officials converting
agricultural land in western and central regions will, of course, be different from that
in coastal China. It may be surmised that urbanization in the sense of a shift from
rural-agricultural activity to urban-industrial activity casts a greater influence on land
use conversion in the eastern coastal provinces than in provinces in less developed
regions. While the general incentives for and constraints on land use conversion
discussed in this study may apply broadly to all localities, local conditions in less
developed counties in central and western China have to be taken into account. The
demand for and supply of land, the local government’s fiscal situation and the
locality’s path of development etc. interact with the general incentive structure
differently to produce varying effects on land use conversion.
On the other hand, limitations on the applicability of this study may be partly
mitigated by testing hypotheses against more comprehensive data on the subject,
such as through comparison with existing statistical evidence and empirical studies to
increase the number of observations.
68
Guangdong’s regional patterns of land use
change will be analyzed alongside nationwide trends in this study. Data collected
from fieldwork is juxtaposed with statistical evidence at the national level and that of
other provinces to advance a more general understanding on the issue from a
broader perspective.
Structure of This Study
The next chapter reviews alternative explanations for land use conversion in China
and offers a coherent framework in studying local patterns of land use conversion. It
proposes that the demands of macro-processes such as industrialization and
urbanization are not adequate in explaining the conversion of agricultural land to non-
68
Since a small number of observations coupled with several explanatory variables imply that the

research design may be indeterminate, it helps to increase the number of observations. See Gary King,
Robert O. Keohane and Sidney Verba, Designing Social Inquiry: Scientific Inference in Qualitative
Research (Princeton, New Jersey: Princeton University Press, 2004), pp. 120-21.
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23
Chapter One
Introduction
agricultural use in China. Similarly, problems and flaws in China’s land system also
do not provide sufficient motivations. Rather, the determinants of land use conversion
include a number of structural, institutional and agential factors. The political and
fiscal institutions that shape officials’ behaviour are important but a comprehensive
study also considers local conditions and the way these local-specific factors interact
with officials’ incentives in explaining local variations in the extent of land use
change.
Chapters Three and Four look into the incentives for and constraints on land use
conversion by local officials from 1988 to the present. The commercialization of land
since 1988 has strengthened local governments’ incentives to profit from land.
Growing expenditures and diminishing revenue sources in the 1994 and post-1994
tax sharing reforms such as the cancellation of agricultural taxes have compelled
local government to seek alternative revenue sources increasingly derived from land
and land development activities. Land revenues comprising of miscellaneous ad hoc
fees and land rent have grown into a substantial “land coffer” beyond the within-
budget fund that is at the disposal of the local government, who may use it to fund
land development activities or the operating expenses of public offices and so on.
Chapter Four suggests that the precedence of economic goals such as GDP levels,
the amount of tax revenues etc. in the evaluation of cadres’ performance prompts
local officials to use land to expand the urban built-up area and generate revenue in
order to maximize their careers. This government engineered, land-centred urban
sprawl, which may not be predicated on the demands of urbanization in the sense of
a shift from rural-agricultural activity to urban-industrial activity, has led to

externalities in the form of large-scale but underutilized infrastructure construction
and the proliferation of development zones that impose considerable costs on
society.
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Chapter One
Introduction
Chapter Five and Six present a case study of land use conversion in Sihui. Chapter
Five examines local conditions such as Sihui’s geographical landscape and fiscal
requirements that impose constraints on the government’s capacity in supplying
agricultural land for conversion. It also shows how these restrictions interact with
officials’ incentives in converting land, which are reinforced by the upper level
governments’ emphasis on industrialization and the relocation of industries from the
Pearl River Delta. Concurrently, local officials also sought to profit from higher land
prices through the expansion of Sihui’s city district. Together, these land
development processes, which encroached upon agricultural land, generated
considerable amounts of taxes and land revenues for the local coffer.
Through the case study of Xiamao town in Sihui, Chapter Six demonstrates how the
conversion of agricultural land to accommodate the inflow of industries translates into
direct benefits for local cadres. It also suggests that officials’ political careers may be
jeopardized under certain conditions when they convert land illegally to fulfil
economic targets. Furthermore, although Sihui’s officials had profited and maximized
revenues through appropriating agricultural land at low cost and leasing it at high
prices, little was spent in return on collective goods. This evidence, together with the
detrimental consequences of indiscriminate land use conversion – environmental
degradation, idle land, and rural disputes over land issues – point to the local
government’s instrumental supply of land as a kind of predatory behaviour.
The concluding chapter extends lessons from land use conversion in Sihui to China
as a whole. The discussion covers the broader implications of land use change, in
particular the feasibility and sustainability of an urban-biased developmental strategy

in societies with a large rural sector and rural population, and the consequences of
governments’ reliance on land use conversion to raise revenue while expending little
in return on the rural sector and the society. Furthermore, the chapter outlines some
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