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Bram Popkema
Master Thesis Urban Geography Supervisor: Marco Bontje
Checkmate by the market – consequences of
(re)development for residents of urban villages
1 Colophon
Master thesis urban geography University of Amsterdam
Title: Checkmate by the market – consequences of (re)development for residents of urban villages Bram Popkema Student number: 10269061 Nieuwehaven 183 2801 CW, Gouda Brampopkema@gmail.com
Supervisor: Marco Bontje Date: 15 August 2016
2 Acknowledgements
"Money can make the city become reality" -Duan Peng-
During one of the conducted interviews a sudden thought crossed my mind. The story of the interviewee was exactly the story I was looking for during my years of study. He spoke about the power of money, unlimited growth and excessive forms of urban development. Although his vision on these aspects was very negative, these are the cases which have always intrigued me the most in urban geography. The rise of a small village to an enormous mega-city within only a few decades, the extravagant expenses on offices and villa's, and the contrast of wealth within the city all seem to be very unreal in a country such as the Netherlands. During this interview, I realized that this was the perfect place for me to do research for my Master degree, and finalize my study.
I would like to thank the University of Amsterdam. The thesis project of the Master Urban
Geography at this university gave me the opportunity to realize this research abroad, in a city where all the previously mentioned aspect are present. Doing research for two months in a totally different culture where almost nobody speaks the same language was very instructive for me as a researcher and as a person. Without this project, I would have never experienced a situation like this.
I would also like to thank my supervisors Marco Bontje and Chin Wen Yang for their guidance during the research. Despite of some setbacks and writing issues, they kept supporting me to the date of submitting this thesis. The same accounts for my fellow students during the fieldwork, who motivated and supported me, and whom I created great memories with. Also, I would like to thank Linda Vlassenrood and the International New Town Institute for organizing meetings with experts in Shenzhen, and for providing a working place in the Center for Design. Last but not least, I would like to thank my parents, Agnes and Geert, for their support in good and in bad times during my study.
3 Abstract
China is experiencing high rates of urbanization over the last three decades and the number of cities with a population over one million rose in a very fast pace. Since the designation of being a Special Economic Zone in 1979, Shenzhen underwent an extreme growth in population and economy. The experiment of the Special Economic Zone could in many ways be identified as a great success for Shenzhen and for China. However, the growth of the city and its population also had negative side-effects such as land shortage and overpopulation. This resulted into redevelopment plans of the government for the so called Urban Villages. This research studies the process of urban redevelopment in urban villages and its consequences on the residents by conducting a comparative case study in two of these urban villages. It seems that redevelopment is expected to take place in centrally located urban villages within the next 5 to 10 years. However, due to the influence of many stakeholders, negotiations are delaying the execution of these plans and is making it unclear when redevelopment will actually take place. There will be little consequences for the residents of the village until the actual redevelopment, but when it takes place they need to move out and are predicted to lose their house, job and social networks. Urban villages in the outskirts of the city are less likely to be redeveloped within the near future, but small urban upgrading and socio-economic projects for the residents are present in these neighborhoods.
4 Acknowledgements 2 Abstract 3 Introduction 6 Theoretical framework 7 History of urbanization 7 Introduction 7 Three phases 8
Urbanization and decision-making: pre and after reform 10
Special Economic Zones 11
Urban Villages 13
Development 13
Current situation and characteristics 15
Redevelopment 17
Market-driven development 17
Property rights 17
State-interference 18
Relations of power in urban villages 18
Role and power 20
Conceptual framework 22
Research Design 25
Case study selection 25
Research methods 25
Literature research 25
Group meetings 26
Observations 26
In depth and semi-structured interviews 26
Surveys 26
Data Analysis 27
Validity and possible limitations 27
Results 29 Site analysis 29 Baishizhou 29 Site analysis 30 Shi Ao 31 Site analysis 31 Planning of redevelopment 33 In general 33 Baishizhou 34 In Shi Ao 37
Conclusion and comparison 38
5
Baishizhou 39
Shi Ao 39
Conclusion and comparison 41
Future of the residents 42
Support for the residents 42
Moving out 43
Protests 44
Conclusion and comparison 44
Conclusion 46
Discussion 48
References 50
Appendix 53
Maps of the pictures 53
Photos 55
Interviews 65
6 Introduction
Shenzhen was given the status of a special economic zone in 1980, and since then grew from 30.000 to almost 15 million residents. Because of the growth of the city, it surrounded hundreds of smaller villages that are now called “urban villages”. Most of the poor migrant laborers who arrived in Shenzhen are living in these villages. Due to the ongoing economic and population growth, combined with a lack of space, the city decided to focus on compact urban development within the current borders of the city. Along with this change of city-planning, the city is also shifting from an industrial based economy towards a modernized high educated job economy (Cartier, 2002). Due to these two reasons, urban villages in Shenzhen are under high pressure of urban reforms. Redevelopment plans caused by this pressure often result in breakdown of the current urban environment, and therefore displacing its inhabitants (Pu Hao, 2012).
“Illegally constructed structures could be potential “bombs” that would threaten the development of a harmonious society” (Mee Kam, 2011). Urban villages are often seen as unwanted urban areas that are holding the growth of the economy back. The perfect city for many people in Shenzhen is modern, rich and green. Urban villages do not fit in this ideology due to its bad appearance. These people are saying that the villages should be demolished and redeveloped into new business districts and luxurious apartments. However, millions of people are living in these neighborhoods, whom all have to be displaced when the villages will be redeveloped. Hundreds of redevelopment plans are up hand within the near future, most of them without a proper view on the effects on the residents. This research focuses on these redevelopment plans, and more importantly its consequences for these people. The results could give government institutions and other stakeholders a better view on the influence of redevelopment on the residents, making it very relevant to society.
This research focuses on the components of the pressure by urbanization in Shenzhen, how it influences the process of redevelopment including all its stakeholders, and the consequences of redevelopment on the residents within the urban villages. This focus will be defined by the following research question:
How does the pressure of urbanization influence the (re)development of urban villages in Shenzhen, and what are the consequences for its residents?
To answer this question, a comparative case study is conducted in two urban villages: Baishizhou and Shi Ao. All relevant stakeholders who are involved in the process of (re)developing urban villages are interviewed to collect information in order to answer the research question. Together with a theoretical foundation, this thesis could be written. The structure of the thesis is as follows: It starts with the theoretical framework to gather necessary background information concerning the variables of this research, and to formulate a proper hypothesis. This will be followed by the research design which includes the methodological approaches. Next, the collected data will be showed and analyzed in the results. Finally, a conclusion will be given to answer the research question followed by a discussed at the end.
7 Theoretical framework
The problem of the consequences of (re)development for the residents are briefly mentioned in the introduction of this thesis. This part will elaborate on the historical background of researched issues, and it will explain the theories of the concepts used during the research. Firstly, the history of urbanization patterns will be given to understand the current environment of urban planning in Shenzhen. Secondly, an explanation will be given on urban villages. Thirdly, the redevelopment process of urban villages in Shenzhen will be covered. And finally, a conceptual framework will provide an overview of how these variables are connected.
History of urbanization
Introduction
The current urban situation of China is one with a long history. Although it can seem that the Chinese metropolitan areas, and especially their city centers are extremely modern and newly built, one must not forget that some of China's cities are among the oldest of the world (Friedmann, 2006). Their origin can be found thousands of years ago and they have faced many transformations. These transformations were all influenced by the country's economic and political situation in an ongoing process. A process which is still taking place, and always will. To fully understand the current situation of urbanization in China, we need to look back at its history. However, for this research it would be too broad and unnecessary to look back too far. Therefore, we start looking the history from the beginning of "modern China", at the establishment of the Peoples Republic of China in 1949, nowadays mostly referred to as China.
According to the statistical yearbook of China (2014), there are over 1.3 billion people living in China, of which 54 percent is living in an urban environment, and 46 percent is living in a rural environment. In 1949 there were 540million people living in China, of which 11 percent was living in an urban environment, and 89 percent was living in an rural environment. When looking at these figures, and looking at figure 1, we have to take into account that the measurements of who and what accounts as "urban" varied strongly over time. Wu and Gaubatz (2013) show that the definition of urban, stated by the government, has changed four times since 1964. These changes were based on aspects such as the size of the city or town, occupation and the time of residence in an "urban" area. Also, boundaries of cities were changed, which caused rural areas to fall within the administrative boundaries of an urban area, thereby becoming "urban" (Zhang, 2008). However, despite these formal statistical changes, it is very clear that the total population and its level of
8 urbanization grew significantly. This population growth and the change of urbanization is due to multiple factors during this period. We could notice three different phases; from 1949 until 1961, from 1962-1978 and from 1978-present.
Three phases 1949-1961
China was under the reign of the Communist party leaded by Mao Zedong since 1949. During the first two phases China was strongly influenced by the Soviet-model of centralized planning. However, unlike the Soviets, the Chinese government was very rural-focused and did not want the cities to grow too large. Opposite to the current imbalance of overpopulation in coastal areas, industrial and urban centers were encouraged to be built more inland (Wu and Gaubatz, 2013). However, during this communist period, there is a big difference between the first and the second phase. The government tried to promote the growth of the medium and small cities at the beginning in this first phase, which led to an increase of the number of cities from 132 in 1949 to 176 in 1957 (Hang, 2006). However, during the 50's the cities were seen as places of consumption and excess, and they would have created a big gap between poor and rich. Influenced by the advice of the Soviets, the Chinese government decided to use the inland based cities as centers for heavy industry and urban industrial development. There were two main reasons for giving the inland cities an economic impulse. One was that the coastal cities accounted for 70% of the industrial capacity in 1949 (Fan, 1995), something that had to be more even distributed according to the leaders of the Party. And the second reason was for defensive considerations (George, 2002). Therefore, this growth mainly occurred in the central part of the country. Along with encouragement of the government for shaping these cities, they also focused on infrastructural improvement in the central part of the country. 75 Percent of the new rail development was located west of the Bejing-Guangzhou line during the entire Maoist period. These and other actions provided this area with new opportunities for economic development and a growth of the level of urbanization from 11 in 1949, to nearly 20 percent by the end of the 50's (Wu and Gaubatz, 2013).
The years of 1958 until 1961 are known as the period of the "great leap forward". A plan from the central government to “catch up with the US and overtake the UK in fifteen years” (Hang, 2006). This had to be done by upscaling local farming to large-scale communes and create a technological revolution in agriculture (Peng, 1987). A somewhat similar process was happening in the industry, where everybody was accountable for the factory with a collective responsibility. Another important principle was that the production of steel had to be multiplied several times. These and other measures should have led to an enormous growth of production in food and metal. Although the government tried to make the people self-efficient, the new system attracted workers to the cities with its urban industrial opportunities, leading to further unwanted urbanization. To counteract this movement, the government created a household registration system to keep the people located where they were born. This resulted in a steady state of the urbanization levels during the 60's (Wu and Gaubatz, 2013). All in all, the great leap forward was not as successful as it was expected by Mao. Production stayed behind expectations and millions of people died of starvation. Therefore, the government made extensive organizational changes and decentralized production management in 1962.
9 1962-1978
During the period of 1961 until 1965, the urbanization rate dropped and the number of cities declined from 208 to 168 (Hang, 2006). This was mainly due to the reorganization of the government, which included the elimination of state budgetary allocation for many cities and the deportation of a part of the population to the countryside. To put a stop to the rise of the urbanization level during the following years, the “up to the mountains and down to the villages” campaign was launched by Mao. This led to the movement of 14-17 million urban youth and millions of other educated professionals to the countryside or to the less populated parts of the country, and created a decline of the urbanization rate to 15-16 percent at the end of the 60's (Wu and Gaubatz, 2013). However, the government did want the bigger cities to grow in order to extend the military capacity and national security. The security was the main reason that this growth was only supported in the western part of the city, because the coastal cities would be too vulnerable in case of war. A reallocation of workers to these western cities was encouraged during this period. Despite all these measures to create a better balance of industrial output between the eastern and the western part of country, the eastern cities still accounted for 60 percent of the total output at the end of the 70's, and the level of urbanization almost reached 20 percent again.
1978-present
After the dead of Mao in 1976, Chinese leaders discussed the future of China, which resulted in a new plan created in 1978 that led to radical physical, social and economic changes. The government created a new development strategy which values efficiency over equity, individual creativity over collectivism, and regional comparative advantages over defense or ideological consideration (Fan 1995). The period after 1978, is often called the "reform era", in which China opens up to the world. The total population of China rose from under 1 billion people in 1980 to almost 1.4 billion people nowadays, and during the same period urbanization levels rose from 20 to 51 percent. Big cities became even bigger, but also the number and the size of smaller cities grew dramatically. Against the will of the deceased Mao, investments in, and growth of the cities was encouraged in the eastern part of the country. Due to the "opening up" ideology, China sought connection to the rest of the world. This had to lead to foreign investments in these eastern cities and an economic impulse that should have filtered through to the rest of the country. Also, de-collectivization of the agricultural activities led to marketization and the development of industrial agriculture, which resulted in the growth of towns and small cities all over China (Hang, 2006).
Four Special Economic Zones (SEZ's) were established in 1979, following the “opening up” principle. These zones were successful test cases for the Chinese government. They were given greater autonomy and were allowed to attract foreign investment. Further elaboration on these zones will follow in the next chapter. This was the first experiment of the Chinese government, and although it was successful, the government did not implement the same principle in the entire country. Instead, they took several steps in which more and more parts of China, mainly cities, gained autonomy and possibilities for foreign trade. Cities in the entire country, but especially in the east, developed and grew rapidly, partly due to this new opening up strategy. Even local governments gained more autonomy and some were allowed to lease their land to others since 1987. The result was that private actors invested in real estate at attractive central areas of the city. This enhanced the creation of the commercial central areas with high rise office building as we know it nowadays.
The 1990's seemed to be a decade of "unanticipated urbanization (Kamal-Chaoui, Leman and Zhang, 2009). The land leasing became very popular with local governments, because this created an important income source for them. They could make their own decisions on real-estate development on these grounds, and take profit of them. This was the start of the real-estate boom in China. The cities grew more and more, but not always in an efficient manner. Real-estate was not always built on demand but often happened based on blind investment, which led to empty
10 apartment blocks and neighborhoods. Although the government tried to stop this movement of uncontrolled real-estate development and the growth of the big cities, they still grew in size and number. The number of cities bigger than two million people grew from nine in 1990 to 13 in 2000, and 42 in 2009 (Wu and Gaubatz, 2013). The growth of these cities became even more attractive for (foreign) companies due to their good infrastructure and big labor force, and for the workers due to a relatively high salary in these cities.
Urbanization and decision-making: pre and after reform
It seems that transformations in urban China happened since the declaration of the Peoples Republic of China in 1949. The main difference between the era before 1978 and the era after 1978 was probably the role of the government.
During the pre-reform era, the government determined the development priorities, the function of the city and it constrained urbanization. This system was bases on the old socialistic system and its centralized decision making. Because the state was in charge over every aspect of production, development and property, the urbanization process was direct and fully controlled by the state. The power of decision-making was always in hands of the government, which had control over all its local governments in a strong top-down hierarchical power structure. Despite significant welfare disparities between urban and rural areas, state-led housing regulation made it very difficult or even impossible to migrate to the urban landscape. Even today housing regulations formed by local authorities and the Hukou system influences migration opportunities and creates advantages and disadvantages bases on a persons' rural or urban registration. The part of the population that owns an urban hukou is allowed to make use of more governmental services within the city than the population without a hukou. With a hukou, one is more likely to have more years of education, has better chances on getting a state sector job and to have healthcare benefit, and is less likely to be unemployed (Liu, 2005). The low urbanization rate of the period before 1978, and even of the period after the reform, could be partially be the result of this state led control (Zhang, 2008)
The system changed considerably since the reform in 1978. Power and control shifted partly and gradually from central to local governments, who gained more autonomy. However, although the planning did not derive only from central policy anymore, the marketization of the country still had to follow the ideology of the socialist system. Public ownership still remained, but the way properties were developed got more liberal and diversified. Also, the rights of possession and management of a piece of land was separated, and employers in the city could decide how big their workforce was and how much they should earn. Especially the latter was an important reason for rural-urban migration due to the attraction of low-payed rural workers by urban companies. Where cities used to rely on a central budget, they are now driven by competitiveness and focus on the attraction of (foreign) investments and cheap labor, causing a rural-urban migration pattern (Zhang, 2008).
It seems that important changes in the process of urban planning occurred after 1978. Decentralization of power, urbanization and an opening up to the free market transformed urban China. However, despite this transformation towards a more capitalistic system, China cannot be seen as a fully open-market economy yet. The state still has enormous influence on everything they want to be in charge of, and it remains the ultimate policy maker as the controller of major projects (Zhang, 2008). China seems to be in a transition from the old central-planned state economy towards an open market economy, without losing its own characteristic socialist identity. This idea from Zang is in line with Friedmann, who states that China's urbanization patterns are largely endogenous. He argues that globalization and its capitalistic forces do have their influences on urbanization and development patterns in China, but they are both complementary and subordinate to the traditional Chinese terms.
11 Special Economic Zones
Zhang notices 3 different types of urbanization: top-to-bottom urbanization, bottom-to-top urbanization and urbanization driven by foreign investment. The last one is particularly interesting in the case of Shenzhen. Foreign investment in Shenzhen lead to a demand for cheap labor and therefore resulted in the attraction of workers from rural areas. Regulation of land leasing has led to former rural plots redeveloped into high density urban areas. The main reason behind this investments of foreign actors and its accompanying urbanization mainly originates 35 years back, with the implementation of Special Economic Zones (SEZ's).
As has been said in the previous chapter, the death of Mao ushered a new era in which China opened up to the global market. Deng Xiaoping, the architect of the new open door policy, started reforms to enter the global market based on 4 pillars (Wei, 1995):
1. Decentralization of decision making on import and export towards local governments and regional foreign trade corporations.
2. Change of administrative regulations on trade towards a system based on licenses, tariffs and quotas.
3. Less control on foreign exchange.
4. Designation of 4 SEZ's, and if successful also other economic "free" zones, to attract foreign investment.
The designation of 4 SEZ's took place in 1980. These zones were all assigned to relatively small towns located in the south-east of China in the provinces Guangdong and Fujian. The main goals of these zones was to attract foreign direct investment, expand exports of China, and accelerate the infusion of technology (Yueng, Lee and Kee, 2009). These areas had to pursue open policy and were seen as testing cases for the rest of the nation. When effective, this form of policy would be applied in more areas of the country. These four zones should serve as a door for foreign investments and the capitalistic world into the rest of China. The main two reasons for the location of these areas were that it was far away from Bejijng, the political center of the country, and because these two provinces had a long history of connection with the outside world. The choice for Shenzhen was based on its proximity to Hong Kong, a city that was seen as an example of capitalism which could be learned from.
Right from the start of the designation of the SEZ's the open door policy resulted in the attraction of foreign investment. Only one year later, in 1981, the zones attracted almost 60 percent of the total foreign investment in China (Wong, 1997). Investment of foreign companies kept growing bigger in the following years, with most of these investment originating from Hong Kong. Between 1984 and 1990, the share of foreign investment by Hong Kong was above 50 percent per year (Wei, 1995). Wei showed that more foreign countries started investing in China,causing the investment to grow from almost nothing in 1979, to 1.7 billion dollars in 1983 and 34.5 billion dollars in 1992. However, even more investments came from domestic linked enterprises. In 1984, Shenzhens’ economy got 6 times bigger than it was in 1980. This was the result of almost unlimited cheap rural labor, uninspiring investment funds and technological innovation (yueng et. al., 2009). The results of the SEZ policy seemed to be of great success. In 1984 a the implementation of 14 coastal open cities has begun in 1988, and in the same year a fifth SEZ was designated. Looking back on the effectiveness of the implementation of these zones, it seems that the status of a SEZ increased annual growth rates with 5.5 percent point (Jones, Lee, Owen, 2003). However, this is an average for all SEZ's. Not every zone was as successful as the other. Corruption, a real estate bubble and other factors held the economic growth back in some of the zones. Shenzhen can be seen as a model case for successful opening up to the global market, and its success caused the government to go through with the implementation of the reforms of the open door policy. Nationwide tax reforms, deregulation of foreign exchange and further decentralization occurred in the 90's.
12 A very important economic advantage for Shenzhen was that it was exempted from paying taxes to the central and provincial government in the first 10 years of its label as a SEZ (Zhu, 1999). This resulted in cheap production, and combined with advantageous foreign trade and the proximity of Hong Kong, Shenzhen became an ideal environment for investment. Non-state sectors were involved in physical development in Shenzhen to speed up property and land development, and private companies became more and more authorized to invest in urban development. The labor market also gained more freedom and started to move towards a market based system, combined with social protection of the workers. Wage reform happened in a way that was never experienced in China before. Different types of (extra) payment were allowed to exist, minimum wages were introduced, and workers got social insurance packages (Yueng et. al., 2009). These reforms resulted in the attraction of massive amounts of workers from the rural areas towards Shenzhen. The large amount of cheap labor was a basis that was needed for the technological innovation caused by collaboration of the foreign and domestic enterprises. A strong and competitive region for manufacturing goods was created. High-tech firms started to locate their factories and research and development activities in the city, and export of high-hardware for telecommunications and computers became booming. At this day, the economy of Shenzhen predominantly consists of high-tech industrialization, logistics, finance and culture industry (Yueng et. al., 2009). The implementation of SEZ's in Shenzhen and other locations could be seen as a very successful experiment, paving the way for China to an open market economy.
13 Urban Villages
The process of urbanization in the last three to four decades, the reforms to an open door policy and the designation of an SEZ on the location of Shenzhen have all led to the Shenzhen as we now know it. A city of millions of people stretched out over an enormous area that is getting more and more populated and dense. Besides of all the socio-economic consequences of this growth, there is also an important physical aspect accompanied with it. Shenzhen started as a relatively small village located at the shore surrounded the sea at one side, and by rural area on the other side. The physical expansion of Shenzhen is one which is planned to a certain extent, instead of growing organically over a large period of time. Due to the fact that the surroundings of the city were not highly populated, this planning and expansion could be based on a surface which could be used just how the planners wanted it to be in their ideal vision, to some extent. The extreme economic growth combined with the attraction of a massive influx of migrant workers resulted in the fast growth of the city. Although the surroundings of Shenzhen were not that highly populated, there were some rural settlements and villages. Because of the expansion of the city, these villages were encompassed and swallowed, and finally annexed to the urban environment. A large amount of these villages got involved and surrounded by the urban area in this way, resulting in the formation of the so called urban villages. This process of the existence of urban villages is shown in figure 2. Baishizhou and Shi Ao are two of these urban villages. To study their (re)development process and its consequences for the residents, it is important to gain knowledge on the physical and socio-economic situation of an urban village. This chapter will give an overview of urban villages in general, their existence in Shenzhen and their redevelopment process.
Development
The people working in these encompassed rural areas lost their farmland and thereby also their occupation. The migration of high numbers of workers to the city brought an alternative for gaining income for the former rural inhabitants. These migrant workers did not possess a hukou, and therefore were not allowed to the formal housing market (Liu, 2005). The exploitation of land and housing in the urban villages brought a solution for this problem. Original villagers demolished parts of their settlements on large scale, and built multiple story apartments in their place. Because of the often good location of the villages, and the relatively low renting price, these apartments became the main place for migrant workers to live. This situation caused by a somewhat free market of housing has led to the housing of one part of the population of Shenzhen. For the other part of the population, it offered a new way of making a living. Therefore,this development can be seen as very effective. However, despite the situation seeming to be ideal, there are many issues concerning livability, the image of these villages and the absence of governmental regulation.
14 Although the urban villages are located within an urban
environment, they officially still are registered as rural. This means that the land of these villages is collectively owned by the villagers, while the rest of the city is state-owned urban land. Thus, every villager family was landlord of their own plot, and could do with it what they want. To gain as much profit as possible, every inch of their plot was used for building new housing apartments, which resulted in a very highly dense environment with narrow streets and high buildings. Original inhabitants of the urban villages, from there on referred to as "villagers", benefited extremely from the new situation. The replacement of their own house by multi-level apartments, build at low cost and rented out to large numbers of people, created a major source of income for these villagers. Because they made a lot of money, they moved to another better neighborhood and in a few years some of these urban villages transformed completely. The original villagers were replaced by migrant workers, and apartment blocks took the place of the original low rise houses.
During the early 80's, the government was not able to provide housing for all the migrants. However, they recognized the importance of the migrant labor for the economic growth of their city. This created a situation where informal construction of housing was tolerated by the local government. In 1982, the government passed a policy to regulate this kind of development by prohibiting the size of residential land area of households. (Hao, 2012). When the construction of 3-4 housing apartments in the early 80's, and up to 8 to 10 stories apartments in the late 80's was finished, the local population started to build constructions with other purposes as well, such as small industry, commercial areas and service facilities. These forms of developments were allowed by the government to a certain extent, but eventually it became too excessive and uncontrollable. Over-development, a bad infrastructure and a lack of safety and hygiene led to problematic situations, which is unwanted by the government of Shenzhen. This situation combined with high land value often ended in large-scale demolition of the entire neighborhood (Hao, 2012).
The real-estate boom in Shenzhen happened in the 90's, and had its consequences for the urban villages. The already existing villages intensified even further, and new rural villages got encompassed in the city due to further expansion. This led to new urban villages in the north of Shenzhen, most of them even outside the official border of the SEZ, where the land prices were lower. These villages evolved mostly in the same manner as the older ones in the center of the city. However, the building hight and density of these areas where different. According to Hao, the number of houses outside the SEZ area grew with 50% from 204.000 in 1999 to 306.000 in 2014, with an increase in floor area of 95%. This has a sharp contrast with the housing within the SEZ zone, because there was no more land available surrounding the urban village. The number of houses in this area grew in the same period from 35.000 to 42.000, and had a floor area that doubled in the same time. Because of the lack of surrounding space, this means that all of this extra floor area had to be created on top of the existing building, making the centrally located urban villages far denser than the northern located ones.
Figure 3: a characteristic picture of an urban village (self-made).
15 Current situation and characteristics
There were around 320 urban villages located in Shenzhen in 2004, spread out all over the cities' territory. The majority of these villages are located in the two districts Bao'an and Longgan, north of the former SEZ. But since the shift of the border of the SEZ, these two districts were included in the SEZ area of Shenzhen, which multiplied five times by size, and made all of these urban villages also lo cating within SEZ borders. The urban villages are covering 13 percent of the total built up
Figure 4: location of urban villages in Shenzhen (Hao, 2012).
16 area in Shenzhen, and the area consists of 50 percent of the total residential area (Hao, Sliuzas, Geertman, 2011). The location of the 320 villages in 2004 are showed in figure 4. After an era of a big expansion of the total land area of all urban villages in Shenzhen, the amount of land coverage of the urban villages only rose from 781 ha in 1999, to 800 ha in 2004 (Hao, 2012). However, the number of buildings kept rising and the total floor area even doubled (figure 5). From 2004 to 2009 land expansion slowed down even more, and the number of buildings decreased. This was mainly caused by regeneration of the building and redevelopment projects of the government. But even since this period the total floor area of the urban villages rose because the buildings were built higher.
The physical appearance of urban villages in Shenzhen is highly influenced by the absence of state regulation. Housing is the main function of these neighborhoods, but they are strongly mixed by industrial sites, shops and an informal service branch. These villages are mostly associated with non-suitable land use, low quality of housing construction, infrastructural problems and in general a deteriorated urban environment (Hao et. al., 2011). The main purpose of the type of construction of the buildings was to maximize the profit for the villagers. A very clear example is the extremely high density of buildings with just a meter or less space in between. Small alleys divide these residential buildings with just enough room to walk through, hang laundry to dry and are occupied by loads of electrical wires. They are also known as 'handshake buildings' because of this situation (figure 6). These residential buildings are often between 6 and 10 stories high, and are in bad condition.
The average age of residents in urban villages in Shenzhen is 30,7 years, according to research based on 807 cases (Wang, Wang & Wu, 2010). The average age when arriving into the urban village of single men is 20-21 years old, and married couples are in their mid-twenties on average. The ratio of
married versus single people is fifty-fifty. The people who are single, mostly live together with other single migrants. 84 Percent of the people living in urban villages, lives in private rental. Most others are living on company provided housing stock. The average floor space per person is only 7.7 square meters, and rooms are shared often. All basic facilities are present in most of the apartments, but it is generally in a very poor condition. The income of the migrants is relatively low, but their job security it is quite stable (Wang et. al., 2010).
Figure 6: handshake buildings (self-made).
17 Redevelopment
Market-driven development
The upcoming neo-liberalization of urban development in the 1980s and 1990s has led to many redevelopment projects in China (He & Wu, 2009). The free market in Shenzhen facilitated the development of the real-estate market. Private investments led by the real-estate companies gave a boost to the redevelopment of urban villages in the city. Where the city always was the driving factor behind urban development, the private sector took over. Several reforms contributing to a free-market in the urban development process have led to this transition (He & Wu, 2009). The first is decentralization of the administrative and fiscal power of the state. The second is the shift from a land grant and public housing system to a land leasing and private housing system resulting in the rise of the real-estate market. The third shift is a change from compensation in-kind towards monetary compensation on the field of relocation and demolition. This process is shown in figure 7. The implementation of these reforms were put in motion by the government to optimize economic and urban growth. This caused a shift of land (re)development from a governmental affair towards a duty for the private market, especially in an extra open-market system as Shenzhen knows. However, it is a mistake to see redevelopment purely as a market-determined process that progresses in a linear way driven by capitalism, according to Weber (2002). The state and other institutions, regardless of being strong or weak, will always influence the process of urban development, she states.
Property rights
Urban villages are the result of high rates of urbanization and the special regulation of property rights in these areas. They accommodate the larger part of the labor force, and are therefore a great contribution to the city (Li & Li, 2011). However, the government sees the urban villages as an urban landscape with undesired looks, social problems and a great opportunity for economic benefit
18 (Hao et. Al, 2011). They are eager to redevelop them, but historical agreements with the villagers about property rights are making this difficult. When the city expanded and needed the rural land belonging to the villagers, they compensated them financially for their land. The government did not have enough money to compensate them for relocation, and granted these villagers the property rights of the housing land in the village. The regulation concerning urban development became much different and came with more freedom within the urban village compared to the urban areas outside the villages. This “vacuum of state regulation” had a great impact on the development process of the villages (Liu, He, Wu & Webster, 2010). The urban villagers took advantage of this situation by building as much buildings as possible to gain the maximum profit from renting to migrants.
State-interference
The type of regulation in the villages is making redevelopment very difficult, which is a problem for the government. The city wants to keep growing economically, but can not expand its size due to land shortage. Therefore, they see the urban villages as a large potential land stock for new developments (Hao, 2012). The land prices of the villages in the central part of the city are rising rapidly, so the government wants to start redeveloping these areas as fast as they can. In 2005, the municipal government of Shenzhen developed a master plan for urban village redevelopment in 2005-2010. An area of 8.9km2 of urban village land had to be redeveloped. This accounted for 11.5 km2 floor area, which had to be replaced by 25.9 km2 floor area with new building (Hao, 2012). This redevelopment plan included 137 different projects for small and large-scale redevelopment. In 2009 only 3 of these projects were finished. The other 134 projects were still in the process of preparation or examination of the plans, the selection of the developers, compensation negotiations or other delaying problems. The redevelopment as the government had planned seemed harder to implement than expected. But the government is persistent in its approach. New redevelopment plans are made and negotiations are continuing. The urban villages in the center of the city will transform from residential neighborhoods to areas made for commercial use and offices. The fact that such a small percentage of the number of redevelopment projects succeeded in the planned time underpins the theory of He and Wu. It shows that the government in Shenzhen does not seem be the main driver behind urban development. Market-based influences from the developers and others have been blocking almost all of the plans of the government, while the government had exclusive rights for urban development practices before the reforms.
Relations of power in urban villages Competing interests
The process of redevelopment in urban villages has many involved actors. There are three main stakeholders: the government, the developers and the original villagers. In addition to these three main actors, we can identify the residents of the village, real-estate companies, architects, consultancy bureaus and others. All of these stakeholder have their own interests and compete for their own benefit. The relations between the three main stakeholder can be modeled in a way shown in figure 8.
The government has three main objectives when it comes to redevelopment. As a public institution they have to consider the environmental aspects of redevelopment. The desire to create an eco-friendly city with natural areas could have a positive impact on the urban redevelopment plans of the government. They also have to take social issues into consideration. The municipal government, to a certain extent, has an obligation towards the population to maintain a certain quality of life for every citizen. This means that they cannot simply demolish the area without giving support to its residents. However, the government does not recognize the migrants living in these areas, and therefore feels little obligation for supporting them with social housing or other measures. The third objective of the government, which often is conflicting with the previous one, is the economical
19 part. The government sees the urban villages as a great opportunity to gain economic profit if they are replaced by offices and commercial companies.
The original villagers of the neighborhood are the landlords of the area. Their main objective of the redevelopment is to earn money. Before the redevelopment, they earned their money by renting property to residents, which is no longer possible after selling. Therefore, whether or not they want their area to be redeveloped depends on the negotiations with all the other parties on how much compensation they will get in terms of money and/or property. Also, it will depend or current and predicted land value. This value will rise when the area becomes more attractive, causing the villagers to wait with selling its land.
Figure 8: Stakeholder in urban villages (Hao et.al., 2011)
The developers are the ones who see the redevelopment as an opportunity to make profit. They are the ones with the money to invest in a project and with the plans to make even more profit in the future. They need to negotiate with the villagers about the compensations, and with the government about the regulations concerning the redevelopment of the village.
All in all, the target of all stakeholders is to make profit. All three of them seem to be willing to redevelop the area. The main issue is that they all have their own interests, which results in long negotiations. Besides, these negotiations and the eventual redevelopment could have great impact
20 on the other stakeholders. The fate of the residents is in the hands of the government, which decides whether the get support or not. Also, the few remaining historical buildings of the village will most certainly disappear. This is one of the few reasons why some villagers are not that eager to redevelop their area. However, this does not seem to be a very important factor, since almost all villagers that have been interviewed in this research were only looking for ways o make more profit.
Role and power
Within the search for succession and achievement of the previously mentioned objectives and interests, these stakeholders all have their own role and power during the process of redevelopment. The model of Hao et. al. corresponds to the power-relationship theory from Fu (2014). The main decision makers within urban redevelopment are the government, the developers and the original villagers. The residents of the villages, the migrants, are not taken into account in this model because they have very little power in the role of decision making. Their future is in the hands of the negotiations of the other stakeholders. According to Fu, the role and the power of the main stakeholders in the process of redevelopment could be best described as followed:
Government
The government in China is divided in multiple different levels. The government is strongly hierarchical, which means that the lower levels of government always have to follow the regulation of the higher layers.
1. The national government is the highest authority. It makes legislation, planning and sets up the national urban agenda.
2. The provincial government applies the central legislation into a more local scale, and intermediates with the city government.
3. The city government is the stakeholder which is involved in the actual implementation of urban planning. It has multiple institutions executing their policy.
1. The first one is the City Planning Bureau, which is concerned with regeneration, zoning, land regulation and the approval of redevelopment proposals. This department will approve potential redevelopment plans in Baishizhou and Shi Ao.
2. The second institution is concerned with the land division after actual redevelopment has taken place.
3. The third institution is the district government. This department sets up public consultancy and informs the people about the development process. The local governments are a part of these district governments. They do not interfere with redevelopment plans and are mainly concerned with the current situation in their neighborhood.
Developers and the private sector
The developers themselves are the actors who invest the money for the redevelopment project. They work closely with the designers who could be divided by two sectors. First is the design institute, which usually is partly governmental and partly private, and works as an intermediate between the developers and the government. Second are the actual design firms, who create the proposals for redevelopment. Another private stakeholder is the real-estate company. These companies possess large stocks of property, and are playing the role of negotiators in the process of buying and selling the land or property between the other stakeholders.
Urban Villagers
The urban villagers are the individual land owners in the village. They are working together in a villager committee. This committee negotiates on behalf of all the villagers during the planning of redevelopment, and takes care of the (urban) environment within the village. Their job during the redevelopment process is to assure a compensation for their property as high as possible. This will
21 happen through negotiations with the governmental institutions, the developers and the other stakeholders.
Concluding, urban redevelopment went through a transition from entirely state driven, towards a market-based process. State interference by planning to redevelop over a hundred urban villages has not been successful due to long negotiations with the other actors caused by deviating regulation in the villages. The three main stakeholders all have their own interests, which in most cases are at the cost of the residents living in these villages. According to Li and Li (2011), governments are more powerful in China than in the West, and therefore have a more dominant role in the power structure. However, since the reform of the economy and the opening up of the market in Shenzhen took place, the city's economy and urban policy looks more similar to the Western kind of policy than ever before. This makes it questionable if the state indeed is as dominant as the author says when it comes to urban redevelopment in urban villages in Shenzhen.
22 Conceptual framework
Informed by knowledge of existing theories and background information concerning the most relevant aspects of this research, a hypothesis and conceptual framework could be developed. The most relevant concepts used within the research are modeled figure 9. Firstly, the content and meaning of these separate variables with be explained, and secondly, the relation between the different variables will be explained based on a hypothesis which aims to answers the main research question.
Urbanization pressure is used as a general term for all forces generating pressure on the redevelopment of urban villages. Mc.Dade and Adair (2001) are defining urbanization as “the process of which local communities become increasingly urban”. For this research I look at urbanization pressure as the influence of urban changes in the city affecting the urban villages. This pressure is caused by, and exists of, several aspects, from which most have been explained in the section of urbanization. The economic and population growth of Shenzhen was mainly caused by the allocation of the city as a SEZ. This growth led to an expansion of the total urban area of the city, and the encirclement of the current urban villages. The continuing population growth and especially the economic growth result in a high demand for space to develop urban space. The demand for urban space and the process of further urbanization of the city is mainly caused by market forces. The open market has introduced private investors into the urban development process, placing them and the market forces among the most determining factors of the pressure of urbanization and (re)development. The amount of influence of capitalistic development forces on the urbanization pressure depends strongly on the geographical location of an area, another form of pressure of urbanization. Urban villages located in the center of the city have a higher land value than the urban villages in the outskirts of the city. Therefore, potential (re)development will normally be significantly influenced by the location of the urban village.
(Re)development is used as an overarching term for regeneration, renewal, upgrading, and demolition and construction in urban areas. It is used as a term to include all different forms of physical change within an urban area, in this research focused on urban villages. This could mean that new development of buildings could take place in an area which was empty before. This happens mainly at the borders of the city because there is very little space for new development in the center of the city. The same accounts for urban villages, but it is possible that there still are some undeveloped territories in the villages that could be developed. The terms large-scale redevelopment and small-scale redevelopment are based on the demolition of existing buildings in urban villages, replacing them by new building. This could happen by building on small-scale, or total demolition of (parts of) the urban village. Urban upgrading is seen as urban physical improvement in any other way, where projects of physical improvement could lead to a better urban environment in the urban village.
The main influence on all the previously mentioned forms of (re)development are its stakeholders. The influence and role of these stakeholders is explained in the chapter of redevelopment. To prevent any kind of confusion, a short explanation about the people living in the urban village and the government have to be given. The terms villager and resident could look similar, but they will be seen as two different actors in this thesis. The villager has to be seen as the original inhabitant of the urban villages. They or their families have lived there even before the reform. Nowadays, the large majority does not live in the village anymore because they earned large amounts of money and have moved to another place. But these people still own the property in the village. The people living here will be described as the residents. These are the migrants who came to the city to get a job. In the thesis will also be referred to the government. As we have seen in the previous chapter, the government exists of many different layers. When there will be spoken of the government
23 without any additions, this will refer to the municipal government, the government at the city level. When the local, district or national government is meant, this will be added.
The future of residents is a concept used for the predicted living standards of these people. One of the aspects which will be looked at in this thesis will be the housing security. Redevelopment of the urban villages could lead to displacement of these people, causing them to search for another home. If and where they will find a new living place, and whether or not they will be supported by others, is an important factor in their future, caused by potential redevelopment. The living environment of the residents within the neighborhood could also change due to (re)development. The living conditions within the urban village are mainly organized by the villager committee, and to some extend by the local government. Their care for the quality of physical aspects of the village could be influenced by the plans for (re)development. Another aspect that will be influenced is the socio-economic situation of the residents. Care from the neighborhood committee and the local government on social and cultural issues could partly be depending on the plans of (re)development. When redevelopment takes place, the residents will have a great chance of losing their social networks and their job in the village.
The following main research question was formulated in the introduction:
How does the pressure of urbanization influence the (re)development of urban villages in Shenzhen, and what are the consequences for its residents?
The conceptual framework, shown in figure 9, tries to answer the research question based on the following hypothesis. The pressure of urbanization, with all its forms, is expected to lead to further (re)development in the urban villages. The open market causes the opportunity for the developers and other private investors to enhance economic and urban growth, just like it has been doing is recent history. This pressure on the urban villages is determined by its location, which makes central urban villages more likely to be (re)developed than urban villages in the outskirts of the city. This redevelopment will be influenced by many stakeholders, where the developers and the government will be expected to have the largest role. The consequences for the future of residents will highly depend on whether or not potential (re)development plans will be implemented. When this will happen, it is expected that they will have to move out without significant support by the
24 government. Their housing security, living environment and socio-economic situation is most likely to deteriorate when redevelopment will go on. If no redevelopment will take place, little changes in the situation of the residents will be expected.
To search for an answer to the main question, and to check if the hypotheses based on literature research will be true, the following sub questions will be answered in the results of this thesis:
1. What are the characteristics of the two urban villages?
2. How does the planning of urban redevelopment look like in urban villages in Shenzhen, in Baishizhou and in Shi Ao?
3. What kind of development is currently happening in these urban villages
25 Research Design
Case study selection
To answer the research question in a proper way, a well-organized research is required. The research is conducted through a comparable case study with a mixed methods approach. The choice of cases was influenced by the thesis project organized by the University of Amsterdam (UVA). In collaboration with the International New Town Institute a project was created to do research in Shenzhen, China, and to follow a program that consists of multiple lectures and tours concerning different kinds of topics which were mostly related to the urban environment. This created an opportunity for me to gain basic knowledge on my interests, urban geography, and made me select a research topic within Shenzhen. To give a proper answer to the research question, I selected two different cases to compare. This was needed because of the importance of the variable 'location' within the conceptual framework. The location of the urban village would probably have a significant impact on the results of the research. Therefore, a case located in the center of the city, Baishizhou, and a case located more in the outer neighborhoods of the city, Shi Ao were selected. Making the selection of these cases it is important to consider time issues, financial issues and especially the possibility of access to the neighborhood (Walword, 2010). However, most important is to select two characteristic cases. The two urban villages do not need to be alike, and they should be able to represent more similar cases. In my selection I tried to achieve all these criteria. Baishizhou was centrally based and one of the best known urban villages in Shenzhen. There was very limited access to literature on urban villages, but compared to other cases there was a lot. Also, the neighborhood was only 15 minutes by cab from the location of my hostel. The other case, Shi Ao, was quite small and literature was extremely hard to find. Traveling towards this location also took a minimum of 90 minutes. However, because of the location in the outskirts of the city, and the interesting developments going on in this neighborhood, it was a very typical case for this study. Another important advantage for choosing a comparative case study is that it is enables operationalization and measurement of the different variables, explain the historical background of the cases, and that it makes it able for a heuristic implementation of new variables (Bennet, 2002). The first two advantage are explicitly made use of in this research, and the third advantage also seemed to be of great importance, since new important insights concerning the situation have been acquired during the process of research. The names of the interviewees and the meetings that were relevant and used in this thesis are shown in table one.
Research methods
To conduct this research, a mixed methods approach has been used. Literature research, group meetings, observations, in-depth and semi-structured interviews and surveys have been done. This approach is chosen to gain information as comprehensive as possible, searching for interesting data and information from different perspectives.
Literature research
Before field research has been conducted in two months April and May of 2016, extensive literature research had to be done to gain knowledge concerning the current broad spectrum around the situation of urban villages. This literature research has been conducted two months in advance of the fieldwork, and consisted of reading literature on urbanization, redevelopment, urban villages and all other influential aspects within the research. During this period, the direction and aim of the research was not yet determined very precisely, resulting in a relatively general overview of literature. Therefore, additional literature research has been conducted during and after the fieldwork. This was needed because the direction of the research slightly changed, and new insights of the situation became clear.
26 Group meetings
The research project of the UVA had eight students and two supervisors. Within this group we had tours through urban villages and meetings with experts within their field during the first 1.5 week in Shenzhen. These meetings were a great source of information for this research. Urban developers, consultancy bureaus and others have been presenting information, and could be asked question afterwards.
Observations
We also visited several urban villages during this period, which provided me of an actual view of the villages instead of only reading about them. Later on during the fieldwork, I have had several guided tours by residents, governmental staff and experts through Baishizhou and Shi Ao. These tours, together with my own observations, provided me with specific information concerning the daily pattern and physical structure of these villages.
In depth and semi-structured interviews
The main core of the results of this research is collected through interviews with important stakeholders of the urban village and the redevelopment process. To get a complete overview, all stakeholders had to be interviewed for this research. Interviews have been conducted with local government officials and officials of the governmental development institute, spokespersons from the neighborhood committees, real-estate companies, architects and others. These interviews were mostly semi-structured. In the appendix is an example given of the planned questions of one of these interviews. However, these questions were mainly used as a guideline for the questions that should be asked. It gave an aim for the questions I would like to have an answer to, more than a strict procedure of questions to be asked in the right order. These interviews were of great importance during this research. Because of the limited access and existence of (English) literature and documents, they were the main source of information during the research. Most of these interviews were conducted together with a translator, since most of the interviewees did not speak English, and I do not speak any Chinese language.
Surveys
As an addition to the information gained by the meetings, the observations, and especially the interviews, surveys among the residents of the urban villages have provided extra insights in the experiences and opinions of the residents about their village and potential redevelopment. A total of 61 surveys were conducted, from which 31 in Shi Ao and 30 in Baishizhou. The purpose of these surveys was to get in touch with the local people. Since hardly anyone spoke English and it was difficult to have proper conversations with them through a translator, a survey that would not be too complicated could lead to the desired information. Also, while conducting the survey, the residents spoke (mainly complained) to my translator about his or her problems, wishes and opinions concerning the topics of the survey. Although this was very limited, it gave extra information adding to the surveys.
The surveys were designed in a clear and simple way, with basic language and the respondents had to be able to be completed in a quick and easy way. This was needed because of two reasons. Firstly, the respondents are not familiar to answering questions lists such as these, so all possible confusion had to be eliminated. Secondly, the language use had to be not too complicated, because many of the respondents were low-educated or did not know how to read very well. Thirdly and lastly, they could not be too long because I had to take into account that the respondents would not be willing to take a lot of time to fill in the form. Also, the survey had to be translated into Mandarin, which is done by a translator. The structure of the survey is based on the sub questions of this research. It is divided in questions concerning their opinion on occupation, urban environment and potential redevelopment.
