On March 29th, 2018, Professor HUANG Jikun, Director of China Center for Agricultural Policy at Peking University, delivered a speech focus on Inclusive Rual Transformation: Pathway, Driving Forces and Impacts, to the governmental officias from developing countries at Peking University Public Policy Forum International. Professor FU Jun, Academic Dean of the Institute of South-South Cooperation and Development at Peking University, chaired the session and he hoped that the students from the South-South Insitute could get in-depth understanding of China's rural transformation from this lecture.

Transformation: Rural Development Pathway

Agriculture transformation in Asia is the response to food demand and market transformation. In the past six decades, the structure of agricultural production in Asia has undergone major changes that the ratio of cereal output has declined, and low value-added grain production is shifting to high value-added commodities.

Prof. Huang Jikun emphasized that the rural transition process in Asian countries basically follows the four-stage transition pathway: 1) Staple food production, 2) Agricultural Diversification, 3) Rising off-farm employment by increasing specialized and mechanized jobs and 4) Integrated urban-rural sustainable development. However, the transition speeds in different countries are quite different. For example, South Asia has completed the second phase of its transformation in the past 60 years, while China has undergone a rapid transition and has completed the first three phases andis now entering the fourth phase.

Innovation: Rural Transformation Driving Force

Major driving forces for the rapid transformation of China's rural economy are 1) institutional innovation, 2) policy innovation, and 3) investment innovation (IPI).

China's land reform is an example of institutional innovation. The household contract system implemented in China in 1978 promoted the enthusiasm of farmers and played an essential role in increasing China crops productivity. Policy innovation included technological progress and market reform. 

After the middle 1980s, technology has been major factor affecting productivity growth that the application of genetically modified technology leaded to a significant increaseon the total factor productivity. Market reforms have achieved market in tegration, promoting the adjustment structure of agriculture and accelerating the transformation of agriculture. Investment innovation refers to the government's investment in agricultural infrastructure to expand the area of irrigated land.

Prof. Huang Jikun pointed out that China has skillfully combined and utilized those driving forces in right sequence to achieve the inclusive and sustainable rural transformation.

Poverty Alleviation: Transformation Impacts

Finally, Prof. Huang Jikun concluded that fostering rural transformation could improve food security, increase farmer's income, reduce rural poverty, and facilitate sustainable rural development; regional differences on food security, farmer's income, rural poverty, and sustainability could be largely explained by the pathway and speed of regional rural transformation; appropriate institution, policy and investment (IPI) are essential for an inclusive and sustainable rural transformation, more important, the sequence of IPIs matters and is critical to speed up the inclusive and sustainable rural transformation.