OECD Urban Policy Reviews: China 2015

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China needs a new model of urbanisation to match the shift to a new model of growth. For decades, both urbanisation and growth have been based on robust export demand, cheap labour, cheap land and artificially low pricing of environmental externalities. None of these can support growth or urban development in the future. This review examines the major challenges associated with the shift to a new model of urbanisation, looking at a range such issues as social and labour-market policies, land use and transport planning, urban planning, urban governance and public finance. The review presents a new assessment of China’s major cities, which defines functional urban areas based on settlement patterns and commuting zones rather than cities defined as administrative units. The results show, among other things, that China has many more mega-cities, with populations above 10 million, than the official data suggest. The good news for China is that the reforms needed to foster what the authorities call “people-centred urbanisation”, while complex, are coherent with one another and supportive of the broader shift to a growth model that relies more on domestic demand and productivity growth.



Enhancing China's urban governance structure

This chapter examines urban governance in China. It assesses the main challenges presented by the current system of inter-governmental relations, which often seems to impede co-ordination across levels of government and among agencies at the same level of government. The chapter proposes strategies for strengthening collaboration for urban planning across levels of government and exploiting potential complementarities across jurisdictions and policy sectors. It also explores local government finance and the way the current arrangements for managing local public finance influence urbanisation decisions. It formulates some recommendations to enable local governments to finance urban development projects in a more sustainable, less distorting way. Finally, the chapter addresses the capacity gaps in Chinese local governments and proposes some measures to acquire the right competences and skills to formulate and implement urban development policies. It concludes with proposals to develop a strategic and integrated approach to urban planning involving real citizen participation.


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