Six Chinese ministries jointly issued a guideline for a trial implementation of encouraging farmers to contribute their right to operate their contracted land to joint agricultural cooperatives or firms, a move an expert said will promote the nation’s agricultural industry while protecting farmers’ interests and enthusiasm.

Compared with former land transfer policies, the guideline issued on the official website of Ministry of Agriculture and Rural Affairs on Monday shows new preferential policies to firms which are attracting farmers to collective operations.

Firms and cooperatives with farmer shareholders will enjoy better support policies of taxation, funding and administration, the guideline said.

The land transfer-related stocks in the A-share market has surged to their daily limit on Monday.

China’s land transfer has moved in the right direction based on rules like the separation rights of operation, ownership, and contract. Since the 18th National Congress of the Communist Party of China in 2012, the reform has entered a new phase of further evolution and improvement, Li Guoxiang, a research fellow at the Chinese Academy of Social Sciences’ Rural Development Institute, told the Global Times.

“The key task of this phase is to help the firms regulate their operations and find new ways to stimulate farmers’ enthusiasm to join collective operations, which will improve production factors allocation and protect their rights at the same time,” said Li.

Among the rural areas which have already started trialing this kind of collective operation, Fengxian district in East China’s Shanghai has enjoyed the advantages of the new model.

An official surnamed Tao with the Fengxian Agriculture Committee told the Global Times on Monday that the collective producing model works better in terms of the industry’s structural adjustment.

“We have built the foundation of rules and regulations in the trial during 2018, which will help the district to make overall decisions based on analysis of the market’s needs,” Tao said, “the farmers’ production activity has also been encouraged by the basic security of land transferring, funds and sharing profits of cooperation.”

For a long time, local farmers lacked development due to separate operations, low efficiency and benefits, Fengxian Statistics Bureau analysis showed.

The guidelines also highlight the necessity of creating new ways to facilitate farmers joining the industry, with an emphasis on securing farmers’ interests in land operations.

“To raise farmer’s power in the firms, a fair conversion system of their land operating rights to share quotas need to be established, which will also give a new opportunity to firms that can provide the service,” Li said. Fengxian district has adopted the measures to convert farmers operation rights over land to money.

(In association with Global Times)