This land is your land

Strict farmland quotas stifle economic development.

That was Xi Jinping's message at Monday's meeting of the Central Commission for Comprehensively Deepening Reform (CCCDR) – the Party's top policymaking body.

Per the big man:

• "[We must] improve the land management system so it better connects with macro policies and regional development agendas...and helps guarantee high-quality development in advantageous areas."

How so? By:

• "Ensuring precise and efficient allocation and utilization of land"

At issue: China sets strict quotas for protecting farmland in each province and municipality in order to bolster food security.

• But these limits don't make sense in places like suburban Shanghai and Shenzhen, where a few extra mu of rice fields may be prioritized over transformative industry or infrastructure projects.

So, what's next?

The CCCDR approved a high-level document on the matter, but it's not yet public. Still, we know a few things:

• Reforms will focus on freeing up land for development in "advantageous regions...with concentrated population and economic activities," according to experts with direct knowledge of the document (21st Century Biz).
• The CCCDR readout says reforms will begin with "exploratory but very urgent" pilot efforts – suggesting trials will start this year.

Get smart: Relaxing farmland quotas in economic powerhouse regions could unlock latent growth potential.

• We think industries that can flourish on the outskirts of developed, urban regions and which contribute to rural revitalization – like food processing and cold chain logistics – will be at the top of the list to benefit.