Checking in on China's 14th Five-Year Plan: Urbanization
From rapid growth to green and people-centered cities
This article marks the first in a series of articles (introduced here) in which we dive into the details, ongoing progress, and global relevance of China’s 14th Five-Year Plan (FYP). We kick things off with the eighth part of the plan titled “Improve the New Urbanization Strategy and Improve the Quality of Urbanization Development”.
As the world watches China's cities swell with tens of millions of new residents, a quiet revolution is unfolding. The challenges are immense: sprawling megacities, overloaded infrastructure, environmental degradation, and widening social inequalities. Yet amidst these pressures, China is charting a bold new course, one that holds profound lessons for a rapidly urbanizing world, a world that seems to spin ever faster on its axis with each passing year. The 14th FYP's new urbanization strategy is not just a blueprint for China's future, but a pioneering attempt to redefine what sustainable, inclusive cities could look like in the 21st century.
China's urbanization targets are ambitious: the 14th Five-Year Plan aims to increase the urban population by approximately 50 million by 2025. However, the true significance of this transformation lies not just in its immense scale, but in the qualitative shifts it represents. The 14th FYP represents a fundamental shift in China's development philosophy, from a focus on rapid growth at all costs to a new emphasis on people-centered, green, and innovation-driven progress.
At the heart of this strategy is a vision of cities as engines of opportunity and wellbeing. By granting urban hukou1 to millions of migrants, investing in public services, and regenerating aging neighborhoods, China aims to build cities that work for everyone. It's a monumental undertaking, one that requires balancing the needs of diverse stakeholders and navigating complex trade-offs.
But can this ambitious vision be realized? The challenges are formidable, deeply rooted in China's unique political economy. Local governments, long reliant on land financing and developer-driven growth, may resist a shift towards more inclusive planning. Integrating millions of migrants into already strained urban systems will require a delicate balancing act. And the imperative of economic growth still looms large, threatening to undermine sustainability goals.
To fully appreciate the implications of China's urbanization strategy, it is instructive to consider it in relation to prevailing global urbanization patterns. While Western models, such as American suburbanization and European transit-oriented development, have long been influential, the increasing prominence of urbanization in Asia and Africa calls for innovative approaches that can effectively balance economic growth, social equity, and environmental sustainability.
As a nation grappling with the simultaneous demands of expanding essential infrastructure and promoting sustainable urban development, China's urbanization journey, with all its twists and turns, holds valuable, perhaps even indispensable insights for other developing countries. The successes and shortcomings of its diverse policy initiatives, such as eco-city pilots and rural revitalization programs, merit close examination for their potential applicability and pitfalls.
Of course, China's model is not a panacea. Its top-down, technocratic approach to planning may not translate well to more pluralistic societies. And its record on issues like civil liberties and minority rights raises serious concerns. But engaging critically with China's urbanization story is essential for any country grappling with the future of its cities.
The Great Transition: From Rapid Growth to People-Centered Progress
The 14th FYP, adopted in March 2021, dedicates significant attention to what it calls "new urbanization". This concept encompasses a range of goals and initiatives aimed at improving the quality, sustainability, and inclusiveness of China's urban development.
The plan's key urbanization targets include:
Raising the urbanization rate of permanent residents to 65% by 2025, up from 60.6% in 2020. This would mean around 50 million more people living in cities.
Granting urban hukou to 50 million new rural migrants. The hukou system has long restricted migrants' access to urban social services like education and healthcare. Reforming it is seen as crucial to reducing inequality and promoting consumption-driven growth.
Developing 10-15 modern metropolitan areas and several world-class city clusters. These regional hubs are envisioned as new engines of innovation and high-quality development, with improved infrastructure and public services.
Improving public services to achieve "equitable access to basic public services" in urban areas. This includes expanding access to education, healthcare, elder care, and affordable housing.
Promoting urban renewal, with a target of renovating 219,000 old urban communities. Many of China's early urban developments are now aging and in need of upgrading. Renewal projects aim to enhance livability and sustainability.
Reducing urban energy consumption and carbon emissions per unit of GDP by 13.5% and 18% respectively. With cities accounting for a growing share of China's emissions, greening them is critical to achieving the country's carbon neutrality goals.
These targets are not just a continuation of past trends, but represent a qualitative shift in China's urbanization model. Whereas previous plans focused on rapid urban expansion and GDP growth, the 14th FYP prioritizes quality of life, balanced development, and sustainability.
This "people-centered" new urbanization push is motivated by several key factors:
Economic rebalancing: With investment-driven growth slowing, China needs to boost domestic consumption to sustain its development. Integrating rural migrants into urban life and improving public services can help expand the middle class and drive demand.
Reducing inequality: The rural-urban divide remains a major source of inequality in China. Granting migrants urban residency rights and investing in rural areas can help narrow the gap and promote social stability.
Improving livability: As Chinese cities mature, quality of life issues like housing, education, healthcare, and the environment are becoming more salient. Enhancing public services and urban amenities is key to attracting talent and maintaining competitiveness.
Sustainable development: China has pledged to peak carbon emissions by 2030 and achieve carbon neutrality by 2060. Developing green, low-carbon cities is essential to meeting these goals while maintaining economic growth.
Demographic pressure: China's population is rapidly aging, with the working-age population projected to shrink in the coming decades. Efficient, productive cities can help offset the economic impacts of this demographic shift.
In short, China's "new urbanization" strategy reflects a recognition that the country's growth model needs to evolve. By prioritizing people-centered, sustainable development, the 14th FYP seeks to lay the foundation for a more balanced, innovative, and resilient economy. How this vision is translated into concrete policies and outcomes will have profound implications for China's future trajectory.
Old Neighborhoods, New Vitality
Recent data suggests that China is making steady progress towards its "new urbanization" goals, though challenges remain. According to the National Bureau of Statistics of China, by the end of 2023, the urbanization rate of permanent residents reached 66.16%, a 0.94 percentage point increase from the previous year. This puts China on track to meet or exceed the 14th FYP's target of 65% by 2025. However, this top-line figure belies a more complex reality.
A key priority of the plan is the reform of the hukou system, which has long restricted migrants' access to urban social services. Such a reform is seen as critical in reducing inequality and promoting consumption-driven growth. There are signs of progress on this front, with some cities experimenting with more inclusive hukou policies. For example, Shanghai and Shenzhen have implemented measures to allow migrants over 60 to access urban social insurance. However, fully integrating the estimated 300 million migrant workers into urban life remains a daunting challenge.
Will hukou reform bridge the urban-rural divide or strain cities further?
Another focus of the plan is developing modern metropolitan areas and city clusters to drive high-quality growth. 2023 data shows strong economic performance in key regions like the Yangtze River Delta (5.7% GDP growth), Yangtze River Economic Belt (5.5%), and Guangdong-Hong Kong-Macao Greater Bay Area. These figures suggest that China's city cluster strategy is bearing fruit, with these regions emerging as hubs of innovation and productivity. However, ensuring that this growth is sustainable and inclusive will require continued investments in public services, environmental protection, and rural-urban integration.
Urban renewal and sustainable development are also key priorities. Cities like Jingdezhen are being lauded as models for industrial heritage protection, having transformed old factories into vibrant cultural districts. The government is encouraging similar projects to enhance urban livability and sustainability. Moreover, a recent study, published in Nature Communications2, found that China's urbanization push could halve nitrogen pollution by 2050, significantly contributing to its sustainable development goals. However, achieving these environmental targets will require substantial investments in green infrastructure, waste management, and clean energy.
From a societal perspective, China's "new urbanization" drive has the potential to significantly improve quality of life and reduce inequality. Granting migrants urban residency rights would give them access to better education, healthcare, and social services, helping to narrow the rural-urban divide. Improving public services and urban amenities could also enhance livability for all city dwellers. However, realizing these benefits will require overcoming entrenched barriers, such as local government resistance to hukou reform and funding constraints for social programs.
China's "new urbanization" strategy represents a significant shift in its development model, prioritizing quality of life, sustainability, and inclusive growth. While recent data suggests progress towards key targets, fully realizing this vision will require sustained effort and investment. Integrating rural migrants, developing livable cities, and promoting sustainable development are complex, long-term endeavors. However, if successful, China's people-centered urbanization drive could offer valuable lessons for other developing countries seeking to balance economic growth with social and environmental sustainability.
As China enters the second half of the 14th FYP period, several key trends and challenges are likely to shape its urbanization trajectory. One critical issue is the pace and depth of hukou reform. While some cities have experimented with more inclusive policies, fully integrating migrants into urban life will require a systemic overhaul of the household registration system. This will likely involve a gradual approach, balancing the need for reform with concerns about overburdening urban infrastructure and services.
Another key trend to watch is the emergence of new metropolitan growth drivers. As China's economy shifts towards innovation and services, city clusters like the Yangtze River Delta and Greater Bay Area are poised to play an increasingly important role. However, the success of these regions will depend on their ability to foster entrepreneurship, attract talent, and promote regional integration. This will require continued investments in education, R&D, and transportation infrastructure.
Sustainable urbanization will also be a critical challenge in the coming years. As China's cities continue to grow and mature, there will be increasing pressure to reduce their environmental footprint. This will involve scaling up green technologies and infrastructure, such as renewable energy, electric vehicles, and smart grids. It will also require a shift in urban planning and design, prioritizing compact, mixed-use development over sprawl.
Looking ahead, China's urbanization experience will have profound implications not only for its own development, but also for the global sustainability agenda. With over half a billion people still living in rural areas, how China manages this transition will shape everything from global consumption patterns to climate change mitigation. As such, the world will be closely watching China's "new urbanization" experiment in the years to come.
China's Urbanization in the Global Context
China's urbanization trajectory stands at a critical juncture, with divergent potential outcomes. Without effective governance, Chinese cities risk becoming cautionary examples of the perils of unchecked growth, beset by environmental degradation, infrastructural strain, and widening social disparities. Alternatively, with judicious policies and investments, these cities have the opportunity to become global models of sustainable, inclusive, and vibrant urban centers, offering valuable lessons for a rapidly urbanizing world.
The path China chooses will have profound implications not just for its own 1.4 billion citizens, but for the planet as a whole. By 2050, more than two-thirds of the world's population will live in cities, many in the rapidly growing metropolises of the global South. How these cities develop - whether they become sprawling slums or sustainable, resilient communities - will shape the trajectory of global development for generations.
As policymakers and planners around the world confront this epochal challenge, they will have much to learn from China's unfolding urban experiment. They will need to grapple with the same tensions - between growth and sustainability, efficiency and equity, top-down control and bottom-up participation. They will need to forge new models of governance and financing, ones that harness the power of markets while protecting the public good.
In this sense, China's urbanization is not just a national project, but a global one. As the world's largest developing country and its most prodigious city-builder, China is both a laboratory and a looking glass, a place where the future of our urban planet is being forged in real-time. By watching closely and learning deeply, we can all become part of this great experiment, partners in the quest to build a more sustainable, inclusive urban age.
The system of household registration that, among other purposes, is used to manage internal migration in China.
Deng, Ouping, et al. "Managing urban development could halve nitrogen pollution in China." Nature Communications15.1 (2024), https://www.nature.com/articles/s41467-023-44685-y