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Special> China International Fair For Investment & Trade> Beijing Review Exclusive> Trade
UPDATED: July 12, 2009 NO. 28 JULY 16, 2009
A Double-Edged Sword
The global financial crisis has not slowed the country's urbanization pace

In line with this trend, China's economy will no longer be driven only by the Yangtze River Delta and the Pearl River Delta, said Wei.

In the future, more regions and urban agglomerations will serve as engines for China's economic development, including the Beijing-Tianjin-Hebei region, the Shandong Peninsula, the Liaodong Peninsula, and the Wuhan urban circle, Wei added.

Fairness is crucial

As a popular saying goes, for farmers, urbanization is to ask for your land, your trees and your grains, but not you.

When rural areas are turned into cities, do farmers become urban inhabitants?

Lu Xueyi, former Director of the Institute of Sociology under CASS, said no.

"China's urbanization has always excluded farmers outside the cities," Lu said.

According to the Ministry of Human Resources and Social Security, as of 2008, only 17 percent of migrant workers participated in basic pension insurance.

Affected by the economic downturn, this February the number of people covered by workplace injury, medical and pension insurance fell 4 percent, 4.8 percent and 2.8 percent, respectively.

Urbanization has not narrowed income gaps. According to the blue book, the urban-rural income ratio averaged about 5 in 2008, in contrast with the gap in 2000, when the ratio was 2.79.

As summer vacation began this month, Ding Rongzhong, a 38-year-old bookseller in Beijing, was expecting the arrival of his only son. Although he has worked in Beijing for more than 10 years, leaving his son in Hubei Province seems the only choice for him.

"I don't have a Beijing household registration. That means my son could not take the college entrance exam in Beijing. My hometown in Hubei has much higher cutoff scores than Beijing. If my son attended school in Beijing and took the exam in Hubei, he could not go to a good university," Ding said.

Ding is still living in a rented room. "On my salary, I can't afford a commercial house," Ding said. "I am not qualified to buy housing for low and medium-wage earners because I don't have a Beijing household registration." Ding plans to return home when he retires, he said.

At the beginning of this year, more than 20 million migrant workers returned to their hometowns from the cities.

"Migrant workers' social security has always been the big problem in China's urbanization," said Ding Wenzhu, a professor at the China National School of Administration, at the blue book release ceremony. "They work in the cities and pay taxes to the cities, but the fact is that the cities don't offer them basic social security. When financial crisis occurs, the migrant workers have to go back home."

There exists an urban-rural dual structure in China regarding the household registration system, land use system, medical security system, social security system and financial distribution system. If we don't change them and forge a unified urban-rural economic system, we cannot achieve excellent social development, said Lu at a forum commemorating the 30th anniversary of the reform and opening-up policy. In 2007, China selected southwestern Chongqing Municipality and Chengdu, capital of Sichuan Province, as pilot reform cities targeting coordinated rural and urban development to reduce, and eventually eliminate, the wealth gap between rural and urban areas.

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