CITIC launches China's first land-backed trust product
BEIJING Oct 15 (Reuters) - A trust company run by CITIC, one of China's biggest investment firms, has launched the country's first trust product backed by rural land rights, as Beijing plans land reforms to boost farm productivity and quicken urbanisation.
Under the plan, CITIC Trust Co. will lease 5,400 mu (360 hectares) of land from farmers in Suzhou city, China's eastern Anhui province, and then transfer the land rights to a farming company, according a statement issued by the trust firm.
Farmers will be paid in rents in addition to wages if they choose to work on the farm, the company said.
Chinese agriculture is still too small-scale to permit investment to boost productivity enough to feed a growing urban population, putting pressure on the government to allow land transfers.
China puts its rural land under collective ownership, giving farmers the rights over their contracted land but barring them from selling the land directly in the market.
Local governments requisition land at low prices and re-sell the land to property developers or factory owners, leaving little gains for farmers. The process is rife with corruption and violence.
Chinese leaders are expected to unveil reform plans at a key party meeting in November to loosen controls on land transfers to help promote large-scale farming and quicken urbanisation.
(Reporting by Zhang Shengnan and Kevin Yao; Editing by Kim Coghill)
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