The scale of China’s urbanization over the past four decades is a staggering feat in human history
In 1978, the year in which China started its policy of ‘reform and opening-up’, the urban population was just over 171 million – 17.9 percent of the total population. In 2016, the urban population was nearly 783 million – 56.8 percent of the total population.
However, history is still in the making as the country’s urban population is on course to hit the one billion mark by 2030.
The government is taking a leading role in supporting this urbanization. One of the primary reasons for this is because research shows that a country’s urbanization level is correlated with its level of economic growth.
The city cluster plan
Of the 19 city clusters, the central government has prioritized three of them to become world-class clusters by 2020. These three clusters, in the Pearl River Delta, the Yangtze River Delta, and Beijing-Tianjin-Hebei, will be the most innovative and internationally competitive of all the clusters, and thus drive national economic development.
The other 16 clusters will have relatively less economic clout. These other 16 clusters can be classified into eight medium-sized and eight small-sized clusters.
Medium-sized clusters each comprise about 3 to 9 percent of national GDP and focus on driving regional economic development. Meanwhile, each small-sized cluster is equal to or less than 2 percent of GDP and focus on driving provincial economic development.
It is likely that two of the eight medium-sized clusters, the Yangtze Mid-River cluster and the Chengdu-Chongqing cluster, will eventually graduate to join the ranks of the three world-class city clusters.
Furthermore, the combined economic contribution of the country’s clusters is astounding.
In 2015 China’s 11 largest city clusters accounted for one-third of the country’s population and two-thirds of its economic activity, according to the Asian Development Bank. Meanwhile, The Economist reports that the 19 city clusters account for nine-tenths of the country’s economic activity.
Although each cluster is ambitious in its own right, the government plans to link the clusters along ‘two-horizontal and three-vertical’ corridors. The ‘two horizontals’ are the Land Bridge Corridor in the north and the Yangtze River Corridor; the ‘three verticals’ are the Coastal Corridor, the Harbin-Beijing-Guangzhou Railway Corridor, and the Baotou-Kunming Railway Corridor.
To extend the international influence of China and its clusters, one of the horizontal corridors and one of the vertical corridors will be linked to the Belt and Road Initiative. The Yangtze River Corridor will be linked to the land ‘Belt’ section, while the Coastal Corridor will be linked to the maritime ‘Road’ section.
Reasons for the city clusters
Although city clusters are not unique to China, the sheer scale of the government’s ambitions for city clusters are beyond those of any other country. The average size of the five biggest clusters in China is 110 million people, which is almost triple the size of Tokyo, the biggest city cluster currently in the world, with a population of 40 million.
Some of the reasons for using city clusters in China are also specifically relevant to the country’s new and current stage of economic development. The government recognizes that the economy is slowing down, and to sustain the economy, it needs to rebalance away from a reliance on export- and investment-led growth, moving towards consumption-led growth.
Source: China Briefing, from Dezan Shira & Associates