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City Renewal in the Course of Rapid Urbanization: Problems and Policy Options

Apr 16,2009

By Lin Jiabin, Research Department of Social Development of DRC

Research Report No.139, 2008

China is in a process of rapid urbanization. In the past 30 years since the country began reform and opening up, urban population has grown from 170 million to nearly 600 million, or about an increase of 14 million a year. Meanwhile, the scale of urban construction has also expanded rapidly. According to the data published by China Statistical Yearbook, the fixed assets investment in urban areas during the 1998~2006 period totaled 41.12 trillion yuan, with 9.16 trillion yuan being put in the real estate industry. People felt that the whole country was like a big construction site.

China is a country with ancient civilization. Many of its cities have historical street blocks and traditional architectures with extremely high historical and cultural values. On the other hand, however, China also went through a period before its reform and opening up, during which urban development was deliberately suspended and urban construction remained stagnant. Accordingly, the old urban districts in many cities have lots of ramshackle or illegally-built houses that must be renovated or demolished. The overlapping of these factors has highlighted, in both magnitude and intensity, the problem of city renewal, which is a difficult job even in developed countries. This paper will outline the main problems confronting China's city renewal, analyze the profound causes and put forward relevant policy options.

I. Main Problems Confronting China's City Renewal

1. Damage to city's historical and cultural landscape

After World War II, some famous cities in the Western countries, such as Paris, London, Munich and New York, all experienced city renewal featuring massive facelift operations. Their main approach was to demolish the old buildings in the downtown areas, damaged or undamaged by the war, and replaced them with numerous skyscrapers. But people soon discovered the renovated areas of these cities lacked the sense of history and the human touch, and became boring. Some scholars criticized that mass reconstruction had destroyed the unique and dynamic buildings and also the city culture, resources and properties. Some people also likened the then “city renewal” to a post-war second damage to the cities. Under the impact of this kind of criticisms and reflections, city renewal featuring mass reconstruction soon came to a quiet end.

But in the course of its rapid urbanization, China failed to avoid the wrong approach once adopted by the Western countries. Worse still, it repeated that approach in an amplified way. In 2003 when urban relocations reached the climax, a total of 161 million square meters of houses were demolished, equivalent to 41.3% of the 390 million square meters of market-traded houses completed in that year (Li Zhonghui: Mass demolition and mass construction: pains and regrest of Chinese cities, People's Daily, Sep. 9,2005). In the course of mass demolition and mass construction, many historical buildings were destroyed, including those which had high historical values and whose reservation was called for by many heritage and architectural history experts. After this mass demolition and mass construction, some historical and cultural cities lost their most representative historical street blocks and had more stereotyped new street blocks. They lost their historical and cultural veins and also their individualities. This caused a widespread concern in the academic circle, and even the British newspaper Financial Times also carried a commentary on June 20, 2007 entitled China bulldozes its urban heritage.

2. Failure to reflect human interest

For some time, China's old district renovations have been basically planned by the government and executed by developers. In this course, the government invested virtually no funds and mainly relied on the commercial development by developers to strike a funding balance. Sometimes, the government even hoped to earn some income from these renovations. The result was that the renovation of ramshackle houses was controlled by the developers. The profitability of a project became the primary goal and the improvement of the residents' housing conditions became secondary. Influenced by this mechanism, the old urban districts with prime locations, low population and building density and good development prospect often became the first to be renovated, while the sections with out-of-the-way locations and a high density of dangerous houses drew no body's interest though they were badly in need of renovations.

3. Sharp contradictions between different stakeholders

In renovating the ramshackle houses in the old urban districts, the major stakeholders included the residents, the government, the developers and the groups and individuals devoted to old town preservation (hereinafter the preservation people). Different stakeholders had different interest pursuits and they generally have sharp contradictions and conflicts between them. Against this backdrop, the developers had sharp contradictions with the residents and the preservation people due to the ambiguous government position. The absence of effective mechanisms for dialogue and coordination sometimes even sharpened these contradictions and affected social stability. An undisputable fact was that relocation-triggered petitions had always claimed a high percentage in all petition cases.

4. Intensive development impedes optimization of city functions

As the ramshackle house renovation projects must each strike a fund balance and as the relocation expenses and compensations rose year after year, the developers must focus on the high-intensity and high-density development projects in the old urban districts in order to pursue economic profits. The result was that major office buildings, hotels and commercial facilities further concentrated in the old districts, thus overburdening these districts with transport as well as commercial and residential functions. The concentration of functions was in a deep conflict with the preservation of the historical landscapes of these districts and seriously impeded the optimization of city function distribution.

II. Causes of Problems

1. Improper definition of government responsibilities

Neither the housing security of the low-income groups nor the preservation of the common human cultural heritages can be realized only by relying on market mechanisms. As the representative of public interest, the government must play the leading role. However, many cities in China have failed to properly handle the relations between the government and the market in the course of executing the ramshackle house renovation projects in the old urban districts and thus allowed the developers to play the de facto leading role. Driven by commercial interests, profit maximization became the primary goal and the public-interest goals such as the preservation of city landscapes and cultural and historical sites and the improvement of the housing conditions of the residents must give way to profit maximization. This is the mechanism cause of the problems confronting China's city renewal.

2. Renovations of old urban districts were planned at low levels

In many cities, urban districts have been regarded as the basic units for rundown district renovations and their district governments are directly responsible for these projects. Although this approach has well-defined subjects of responsibility and could mobilize the initiative of the district governments, the low status of these districts as the planners in general has more disadvantages than advantages. As the basic planning units, these districts have to work alone to solve the issues of demolition, relocation and fund raising within their jurisdictions. They have too little room for maneuvering and the difficulties are too serious for them to solve. This has virtually turned the rundown district relocation and renovation into a highly intensive development act and made it difficult to accommodate both the preservation of historical and cultural landscapes and the renovation of ramshackle houses.


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