Legal Daily – What impact does the No. 1 Central Document have on farmers? The contracted land‑use relationship will remain unchanged for the long term.

Recently, the “Opinions of the CPC Central Committee and the State Council on Deepening Supply-Side Structural Reform in Agriculture and Accelerating the Cultivation of New Momentum for Agricultural and Rural Development” were officially released. This 2017 No. 1 Central Document continues to focus on “agriculture, rural areas, and farmers,” designating the deepening of supply-side structural reform in agriculture as the central task guiding agricultural and rural work in the new historical stage.

Tang Renjian, Deputy Head of the Central Rural Work Leading Group, Director of the Central Agricultural Office, and Deputy Director of the Central Financial and Economic Affairs Office, granted a media interview to provide a comprehensive interpretation of the document’s spirit, expressing hope that it will further assist farmers in carrying out their production and business activities for the new year. Meanwhile, relevant experts addressed pressing issues of concern to farmers by analyzing the contents of the No. 1 Central Document.

Separation of Three Rights

The contracting relationship remains unchanged for the long term.

Since 1978, when Xiaogang Village pioneered the household contract responsibility system nationwide, we have now entered its 39th year. The household contract responsibility system represented an institutional innovation within the framework of the public‑ownership system at the time, dividing land rights into two distinct components—separating land ownership from the right to contract and operate the land—and granting farmers the latter. This move significantly boosted their work enthusiasm.

Nearly four decades later, according to statistical data, by the end of 2015, the area of contracted farmland transferred nationwide had reached 443 million mu, accounting for 33.3% of the total. Meanwhile, another set of figures indicates that an increasing number of people are leaving rural areas; in 2016, China’s urban resident population stood at 792.98 million, with an urbanization rate of 57.35%.

“In the early days of land contracting, each household was allocated small plots of varying quality—good, medium, and poor—which resulted in fragmented, scattered landholdings. When large-scale farmers sought to lease or transfer these parcels, the presence of ‘patchwork’ plots often made it difficult to consolidate contiguous blocks.” According to Yang Chunlong, head of the Economic Management Station at the Agriculture Bureau of Changtai County, Fujian Province, the biggest concern among farmers participating in land‑transfer is a lack of confidence: they fear that once they hand over their land, disputes over ownership could arise years later, leaving them unable to reclaim it. Meanwhile, large‑scale growers are equally frustrated: on a given piece of land, only three to five households remain; if neither they nor others cultivate it or lease it out, it’s impossible to form coherent, contiguous fields, thereby hindering large‑scale operations.

In response to these pressing realities, this year’s No. 1 Central Document for the first time explicitly calls for deepening reform of the rural collective property rights system and implementing the “separation of three rights” — namely, collective ownership of rural land, household contract rights, and land‑operation rights. Furthermore, the document proposes accelerating the development of large‑scale operations in various forms, such as land‑transfer‑based management, shareholding cooperatives, entrusted farming and planting, and land‑trust services.

The “separation of three rights” builds on the earlier “separation of two rights” by dividing the original contract‑based management right into two: the contractual right remains with the farmer, while the management right is separated and can be transferred to non‑farmers.

To reassure farmers, the No. 1 Central Document calls for accelerating the confirmation, registration, and certification of rural contracted land rights, while expanding the scope of province‑wide pilot programs. Moreover, at the end of last year, the General Offices of the CPC Central Committee and the State Council issued the “Opinions on Improving the System of Separating Ownership, Contracting Rights, and Operating Rights of Rural Land,” which explicitly stipulates that existing land contract relationships must be stabilized and maintained unchanged over the long term; no organization or individual may compel or restrict the transfer of such land; nor may they illegally adjust farmers’ contracted plots. “By clearly defining farmers’ land rights and issuing ironclad certificates, we can give them real peace of mind,” said Wang Jinbao, Director of the Shandong Provincial Department of Agriculture. He added that safeguarding farmers’ rights will make the implementation of the “separation of three rights” considerably easier.

For large-scale farmers, the “separation of three rights” not only facilitates greater consolidation of land holdings but also enables them to leverage their operating rights for financing, thereby unlocking rural resources, capital, and assets and increasing investment in medium- and long-term, large-scale agricultural operations. In the past, however, lessees under land-transfer arrangements were unable to use their land contract management rights as collateral for loans.

So, what happens if a cooperative or a large-scale farmer takes out a loan using someone else’s land as collateral and the operation turns out poorly? Will the farmers end up at a loss? In response, Lang Xianpeng, president of the Shouguang Rural Commercial Bank in Shandong Province, explained: “If the loan cannot be repaid, when the collateral is eventually liquidated, only the operating rights to that piece of land will be seized—without affecting the farmers’ contractual land‑use rights.” For example, the bank can find a successor to take over the land and continue its management, while still paying the farmers the land rent originally agreed upon.

Cultivation and breeding

Pursuing green, ecological, and sustainable development

“At present, both the domestic and international environments shaping agricultural and rural development have undergone significant changes, giving rise to numerous new contradictions and challenges.” Regarding agricultural production, Tang Renjian noted that, at present, demand for agricultural products has upgraded while effective supply has failed to keep pace; resource and environmental carrying capacity has reached its limit, yet green production has lagged behind; low-priced imported agricultural goods have entered the market, leaving domestic producers unable to compete; and the traditional drivers of farmers’ income growth have weakened, with new sources of momentum yet to emerge.

“Whether the supply-side structural reform in agriculture succeeds depends on whether the supply system has been optimized and efficiency has improved, but even more so on whether farmers’ incomes have risen and they have reaped tangible benefits. The primary focus is to enhance the quality of agricultural supply,” said Tang Renjian. He added that reform must be used to steer agricultural and rural development away from an over-reliance on resource consumption and a narrow emphasis on quantity, toward a model that prioritizes green, ecological sustainability and places greater emphasis on meeting quality‑driven demand—thereby boosting agricultural productivity, increasing farmers’ incomes, and greening rural areas. Farmers should promptly shift their mindset by cultivating and raising eco‑friendly, green agricultural products, elevating product quality, and transitioning from extensive to precision farming.

While analyzing the document’s contents, Tang Renjian stated that the supply-side structural reform in agriculture comprises two major components: structural adjustment and institutional reform. Specifically, the agricultural supply side is to advance “three major adjustments”—

Optimize the product mix and emphasize quality. The document calls for coordinated adjustments to the structure of grain, cash crop, and feed‑crop cultivation; the development of large‑scale, efficient animal husbandry; the expansion and strengthening of leading, distinctive industries; the optimization of regional agricultural layouts; and the enhancement of agricultural product quality and food safety standards.

Optimize production methods and emphasize “green” principles. By promoting green production practices and restoring and improving the ecological environment, we can both address past environmental debts and ensure that future generations have room to survive and thrive. The document calls for advancing clean agricultural production, implementing large-scale water-saving projects in agriculture, focusing on addressing pressing environmental issues in the agricultural sector, and strengthening the construction of major ecological projects.

Optimize the industrial structure and emphasize “newness.” Focus on developing new rural industries and business models, promote deep integration among the primary, secondary, and tertiary sectors, and achieve comprehensive upgrading across all stages of agriculture and value enhancement along the entire agricultural value chain. The document calls for robust development of rural leisure and tourism, advancement of e‑commerce in rural areas, accelerated growth of the modern food industry, and the cultivation of distinctive villages and towns that are both livable and conducive to business.

Rural business formats

Supports leisure travel and retirement living.

Tang Renjian stated that there is strong demand for land to support emerging industries and business models, such as leisure agriculture, rural tourism, and rural elderly care. Accordingly, the document proposes allowing surplus construction land—generated through village improvement and the reorganization of residential land—to be utilized via equity participation, joint ventures, and other mechanisms, with a focus on supporting rural leisure, tourism, and elderly‑care sectors, as well as the integrated development of the three rural industries.

The document emphasizes the need to carefully summarize the experiences gained from pilot programs on rural residential land‑use system reform. On the premise of fully safeguarding rural households’ usufructuary rights to their residential land and preventing the encroachment and control of external capital, it calls for implementing collective ownership of residential land, protecting farmers’ lawful rights to occupy and use such land, and exploring ways for rural collective organizations to revitalize and make effective use of idle farmhouses and residential land through leasing, cooperation, and other means, thereby increasing farmers’ property‑related income.

He pointed out that, in the use of residential land and other collectively-owned construction land, two key considerations must be borne in mind: first, the development of real estate or the construction of private estates and clubs in violation of laws and regulations is strictly prohibited; second, the rights of farming households and rural collective economic organizations must be safeguarded to prevent collective assets from falling under the control of external capital. The document also proposes supporting, in eligible rural areas, the development of pastoral complexes—centered on farmer cooperatives, ensuring full participation and benefit for farmers, and integrating circular agriculture, creative agriculture, and agritourism experiences—through pilot projects and demonstration initiatives funded via channels such as comprehensive agricultural development programs and transfer payments for rural comprehensive reform.

Tang Renjian stated that there is an urgent need to cultivate talent in rural architectural design and rural planning. The document accordingly calls for encouraging universities and vocational colleges to establish relevant majors and courses in rural planning and construction, as well as rural housing design, with the aim of training a pool of specialized professionals and supporting a cadre of rural artisans.

□ Our reporter Xu Weilun