City cluster plans will accelerate elimination of hukou restrictions

ON FEB 21, the National Development and Reform Commission issued the Guiding Opinions on Cultivating the Development of a Modern Metropolis, which clearly states that it would remove all the restrictions on applicants for an urban hukou, or household registration, except for some megacities. China Daily reporter Li Yang comments:

The focus of the guiding stipulations is to speed up the elimination of the household registration barrier between urban and rural areas and promote the urbanization of migrant workers within the 13 city clusters nationwide that have been earmarked for a bigger role in boosting economic growth and innovation.

Accordingly, the supply of medical care, pension, education and other welfare related to hukou will be increased to meet the demands of newcomers.

In fact, before the commission released its guidelines, most medium and small-sized cities have already opened their doors to professionals from home and abroad, college graduates and skilled workers.

Now, according to the document the elimination of household registration barriers between urban and rural areas will be accelerated to promote the coordinated integration of the migrant population with the local population.

It is predictable that the competition for talents and young laborers will become fiercer among the cities, with more favorable policies in housing and other public services being implemented to attract young professionals, which is conducive to driving up local housing prices. Which the local governments are happy to see as revenues from selling land remain a main source of revenue for them.

But the other content of the document also deserves attention. For instance, it urges the construction of intercity road networks and the establishing of connected urban public transport services and public utilities in each urban agglomeration.

In this process, the city clusters will be transformed from concept to reality step by step, adding impetus to a new round of urbanization.

The leading position of the first echelon of Beijing, Shanghai, Guangzhou and Shenzhen will be consolidated, and the ranking of second-tier cities might be reshuffled, with the cities are expected to divert more attention from pursuing economic growth to improving their public services, and development and living environments.