CHINA: Party Leaders Endorse Property Rights

In Break From Founding Ideals, Party Also Decides to Allow Large Land Holdings
Publisher Name: 
Washington Post

China's top Communist Party leaders ended a four-day
meeting Tuesday with promises to protect private property and allow
farmers to amass large land holdings, key steps toward creating a more
capitalist economy, state-run media said.

The decisions, made at a meeting of the Communist Party's Central
Committee, marked another radical break with the country's founding ideals
and a pragmatic recognition that economic reforms have remade society.
Communist China was established in 1949 on the idea that private property
should not exist and that farmers should work on communes where all land
was held in common. Now private firms produce more than half the economy's
total output, and farmers till their own plots.

The plenum, presided over by President Hu Jintao, underscored a further
shift away from belief in the primary importance of state-owned industries
to realization that the country's hopes lie in its vibrant private sector.
State television said delegates agreed to continue supporting state-owned
firms, while encouraging private companies to enter sectors previously
closed to them such as infrastructure and public utilities. "Non-state
firms will enjoy the same treatment as other enterprises in fundraising,
investment, land use, tax and foreign trade," state-run television said.

Allowing farmers to transfer their rights to land, thus letting some amass
large holdings, has been tried as an experiment in several provinces. Two
government researchers said the move by the Central Committee could remake
the face of agriculture, which currently involves millions of small
holders.

An estimated 700 million of China's 1.3 billion people live off the land.
China is worried about competition in the World Trade Organization from
foreign foodstuffs, and the emergence of big farms would increase
agricultural efficiency, an agronomist said, on condition of anonymity.
But it could also rapidly increase unemployment in the countryside, where
farmers' incomes have been flat for about the past five years.

Both changes -- the protection of private property and the freedom to
transfer land rights -- are controversial. Some researchers have opposed
the protection of private property because they argue that much of the
wealth amassed over the last decade during an unprecedented economic boom
is rooted in corruption and theft of state assets. "Many people made their
money by illegal means; many people never paid taxes. Should we be
protecting them?" asked Dia Jianzhong, a leading social scientist.

Other researchers have expressed worries about allowing farmers to
transfer land because it could mean a return of big landlords, who were
eliminated during the 1949 revolution. It also could open the way for
greater abuses of poor farmers by local governments, which are now
stealing farmers' land on an unprecedented basis, according to official
central government reports.

State media have trumpeted the importance of the meeting, the Third Plenum
of the 16th Party Congress, just as China was gearing up for its first
manned space launch in an apparent propaganda campaign for China's
communist system.

The meeting came 11 months after Hu assumed the leadership of the
Communist Party in China's most orderly transition ever. Hu has moved
rapidly to secure power and has impressed many Chinese and Western
observers with his pragmatic approach to policies. Under his stewardship,
China for the first time participated in a meeting of the Group of Eight
nations and is now cooperating with the United States on working to solve
the nuclear crisis in North Korea.

Domestically, while China's security services have maintained a crackdown
on dissent and religion, Hu's government has modified some social
policies. For example, couples no longer need the permission of their
employers to marry. China also annulled a law that gave police the power
to arrest almost any traveler and accuse him or her of vagrancy.

"Hu's style is simple," said Zhen Xiaoying, the vice president of the
Central School of Socialism. "He doesn't talk about changes, he goes ahead
and makes them."

The New China News Agency reported that 188 members and 154 alternates of
the Central Committee, which sets policy for the 60 million-member party,
approved several revisions to the constitution as well as a package of
measures to "perfect several issues in the socialist market economic
system." Those measures and constitutional changes will be sent to the
Standing Committee of China's legislature, which will turn them into law,
the report said.

Although the official news agency did not spell out those changes, a
longer report later on China Central Television said the plenum committed
the party to protecting private property and private business, leading
analysts to conclude that, as expected, the party would revise the
constitution to bolster protection of private property.

The plenum also vowed to address growing economic gaps between village and
city, and the coast and interior. Although the gross domestic product has
tripled since 1980 and the economy is on track to grow by 8 percent this
year, growth is increasingly inequitable. Eastern areas are enjoying boom
times, while people in the west and central regions remain largely
destitute.

The plenum also appeared to take steps toward writing a new theory into
the constitution as a basis of Communist Party rule. That theory, called
the Three Represents, is the brainchild of Hu's predecessor at the party
helm, former president Jiang Zemin. It essentially says the party should
now represent the interests of the economic and cultural elite as well as
those of everyone else.

It is an acknowledgment of the contributions of the nouveau riche and
fast-growing middle class to economic growth and a recognition that the
party cannot stay in power if it remains simply the party of the peasants
and working class. State television said the plenum would write into the
constitution "important theoretical principles decided upon at the 16th
Party Congress," which, according to several Chinese sources, was code for
this theory.

AMP Section Name:Food and Agriculture