China to work out permanent mechanism to close urban-rural gap

BEIJING—China will work out a permanent mechanism to improve rural infrastructure as part of its efforts to boost agricultural development and close the widening wealth gap between urban and rural areas, a senior official said here on Thursday.
Chen Xiwen, director of the office of the central leading group on rural work, told a press conference that China would keep increasing investment in the countryside to seek coordinated development of urban and rural economies. The government would expand its agricultural budget and channel its revenues from land-use charges and arable land occupation tax to rural areas, he said. Local governments would also set aside part of their city construction budgets for rural areas.
This fresh move enables industry to promote agriculture and urban areas to help rural ones as agriculture remains the weakest link in the national economy. The central government was likely to raise its 2008 rural budget to some 520 billion yuan (72.2 billion U.S. dollars), compared with last year’s 392 billion yuan, he said.
China invested 420 billion yuan last year in the countryside, representing a record-high increase of 80 billion yuan from 2006. Li Chenggui, a researcher with Rural Development Institute under the Chinese Academy of Social Sciences, said agriculture was the foundation of the national economy because it produced food, created jobs and even bore upon social stability.
“But China’s agriculture is still vulnerable to such risks as natural disasters, market fluctuations and animal epidemics,” he said. “So it needs to be consolidated.” “More investment in the countryside is part of a permanent mechanism because modern agriculture is actually a capital-intensive and technology-intensive sector, which has rather high requirements for infrastructure construction,” he said.
The State Council, China’s cabinet, issued on Wednesday the first policy document of the year, reaffirming the central government’s commitment to the vast countryside. Both government expenditure and fixed asset investment in the countryside must “expand at a markedly faster pace” this year, the document said.
Local governments above the county level must ensure that growth in agriculture spending would outpace their revenue growth, it said. It added they should place more emphasis on building infrastructure and developing social undertakings in the countryside than in cities. More investment would go to the construction of infrastructure projects in water, gas and electricity, as well as in agricultural technology, among others.
Also covered were investments in education and medical services and subsidies for farmers and agricultural production. The document also said China would fully protect farmers’ land rights and migrant workers’ interests.
An equal employment system for rural and urban laborers would be established, with farmers who have a stable job and residence in cities having access to the status as urban residents. Their income, social security, housing and children’s education would be better guaranteed. The Chinese government has vowed to ensure a steady supply of farm produce, which has been threatened by the heavy snow that has fallen since mid-January, the worst in five decades.
Supply shortages are causing another round of price rises for agriculture products, for instance those which make up essential daily food. Southern regions where farmers grow crops over winter were stricken severely by the bad weather, said a leading agricultural policy decision maker Chen Xiwen on Thursday.
“The blow was especially hard on vegetable production, which was ruinous in some places,” he said. The snow hit 105 million mu (7 million hectares) of farmland, mainly in the middle and downstream Yangtze River, and crops were entirely destroyed on 11.3 million mu, according to the Ministry of Agriculture (MOA). Cole and other vegetables, oranges and wheat were especially hard hit.
Dairy and meat supplies were under pressure from the cold as well as shortages of animal feed and water. Some 874,000 pigs, 85,000 cattle, 459,000 sheep and 14.4 million poultry had died, according to Chen Weisheng, who is in charge of husbandry with MOA.—Xinhua