Transforming Agriculture

China Newsweek
March 11

The Central Government encouraged the development of family farms and investment in rural areas in a document issued at the beginning of this year.

With Chinese agriculture's greatly improved productivity and the flow of rural labor into cities, the country's agriculture is going through a fundamental change from traditional to modern.

In 2012, the mechanization rate of agriculture reached 55 percent, double that of 30 years ago. This means that much less labor is needed to farm. At the same time, during the past 30 years, 250 million farmers have moved to cities, sharply reducing labor force in rural areas. Urban residents accounted for more than half the total population in 2012.

With the reduced rural population, per-capita arable land has increased, making it possible for one family to farm a larger area. According to statistics from the Ministry of Agriculture, the number of family farms that till land of more than 100 mu (about 66,600 square meters) had reached 2.7 million by the end of 2012.

However, problems remain in developing family farms. Many rural cooperatives are not playing their due functions in supporting family farms while clarification of rural land use rights is in slow progress.

Prescriptions by Bill Gates

Caixin
February 25

On February 12, Caixin magazine interviewed Bill Gates in Mexico City. He talked about how to make charitable organizations more effective and programs he had carried out in China.

As founder and former CEO of Microsoft, Gates topped the Forbes rich list for 13 years from 1995 to 2007. The Bill & Melinda Gates Foundation is one of the largest private charity foundations. By December 2012, its total assets had reached $36.2 billion.

Ever since the foundation set up an office in China in 2007, it had invested more than $200 million in such programs as HIV/AIDS and tuberculosis.

Talking about China's charity causes, Gates said the number of foundations is small and charity is at a starting stage, with most programs focused on disaster relief. The government can effectively push forward charity by helping entrepreneurs establish organizations and offer tax incentives.

More Flexible Taxation Policy

Beijing Business Today
March 8

Responding to the public call for raising the individual income tax threshold, Song Lan, Vice Minister of the State Administration of Taxation, said recently that it is impossible to further raise the threshold as increasing it to 3,500 yuan ($563) in 2011 has already reduced the number of tax payers from 90 million to 30 million.

Is the 3,500 yuan threshold low? There is no standard answer to this question because China is a vast country with imbalanced economic and social development across regions. In Beijing, 3,500 yuan is low for middle and upper-middle income groups because, although these people make more money, they have to sustain a high living cost in the big city. Raising the threshold can leave them more money to support themselves. However, in most northeastern cities, the 3,500 yuan threshold means that most middle and upper income groups are exempt from individual income taxes. Further raising it will have limited benefit to society.

The threshold should be set by local governments according to local conditions, because it's hard to come up with a threshold that suits all provinces.

Adjusting Population Policy

YNET.com
March 9

Premier Wen Jiabao said in the government work report delivered at the First Session of the 12th National People's Congress that China will stick to its family planning policy and in the meantime work to improve its overall stance to suit the change in demographic structure and promote long-term and balanced development.

The one-child policy came into being under particular historical conditions. The Central Committee of the Communist Party of China issued an open letter in 1980, stating that a different approach could be adopted 30 years later, when population growth slowed down. Now, after 30 years, the effect of the policy in controlling population growth is evident. However, as China is facing different economic and social situations, it's time to adjust and improve.

The shortcomings of the current population policy are increasingly obvious. For example, aging is a serious issue, the demographic dividend is disappearing and only-child personality problems are emerging. Families that have lost their only child also have pressing social problems. In Shanghai alone, 1 million families have no children, which is very shocking. Slightly loosening the family planning policy will not lead to a population explosion as cities that have allowed a second child haven't had a birthrate rebound. However, the growth rate of population should be kept lower than that of the economy to ensure that living standards are not dragged down.

The adjustment of population policy should take into consideration common people's opinions. This year's government report on further improving population laws reflects an active response to common will. Accordingly, the function of population and family planning departments should be transformed. Besides, these departments should provide reproductive services to the people, and respect and guarantee their rights to give birth. Only by doing so, can they steadily push forward the betterment of population policy and solve the problems of population size, structure and distribution.