[photopress:China_land.jpg,full,alignright]A group of Chinese scholars and retired officials has petitioned China’s legislature to halt the privatization of state companies. The sharply worded appeal, posted online, criticized a decade long program to privatize state companies, saying it had allowed hundreds of millions of dollars in assets to fall into private and foreign hands. Such privatization, it said, violates the constitution. This is but one point of view. There are many others.
A number of motions are expected to be tabled at the upcoming ‘two sessions’ — the annual meetings of China’s top legislature and political advisory body. It is probable that corruption prevention will be the main topic but soaring housing costs will also top the concerns of participants at the ‘two sessions.’
Land ownership will be also be widely discussed at the annual sessions of the National People’s Congress (NPC) and the National Committee of the Chinese People’s Political Consultative Conference (CPPCC) scheduled to open on March 5 and March 3 respectively.
The two sessions are considered the most important annual political events in China. This year the two sessions are particularly important.
Chinese Premier Wen Jiabao has invited 12 ordinary residents to join the discussion of the government’s work report which will be submitted to the NPC’s annual session.
The NPC will debate two key pieces of legislation. The first would unify the corporate tax for foreign and domestic companies; the second — and perhaps more significant — would clarify and expand private property rights in China. According to Hong Kong-based newspaper, Wen Wei Po, the NPC session has even been extended by a few days to allow for more debate on the legislation.
One of the main focuses of public discontent is the seemingly arbitrary confiscation of land by local officials for construction, housing and industrial projects — projects that benefit the officials but leave residents and workers out in the cold.
In China, all land is state land, and though many local officials have gone well beyond their approved mandates, they have simply used the legal system for their own gain. The new private property law is designed in part to reverse this trend and bring more reliability and predictability to land use in China.
The new draft currently circulating among Party members is significantly different from previous versions. The draft is unprecedented in the specificity with which it defines property rights regulations. (One version contains five sections, 20 chapters and 286 articles, running more than 21,000 characters in length).
It contains numerous changes and additions to previous property laws. Most noticeable is the new Article 66, which says private individuals shall enjoy the right to own documented and legally acquired buildings, income and personal possessions, and have the right to legally acquired tools and raw materials used as means of production.
This is one of the first legal definitions codified for private property, clearly defining the concept as the right to occupy, use and profit from land, whether as a state entity, collective, private business or Chinese citizen.
While maintaining that the land the property is on still belongs to the state, the new law also addresses the confiscation of land by local and regional governments. It is very clear that the state will take steps to limit and protect the transfer of cultivated land to urban use, thereby removing some of the causes for social unrest.
In the end, while it is granting the right of private property, the state will still own all the land upon which property sits, and if it can implement the new regulation, the central government will gain much more direct control over the use of the land. This will give it one more tool with which to shape future economic development, the distribution of resources and economic growth and — it hopes — the tools necessary to maintain social cohesion.