China targets State farms in agriculture modernization

BEIJING - The government has singled out State-managed farms as in need of an overhaul as it bids to modernize the country's agriculture.

State farms will be transformed into modern companies through innovation and industrial upgrades, according to a statement released after a meeting of the Central Leading Group for Deepening Overall Reform, presided over by President Xi Jinping, on Tuesday.

The meeting passed guidelines on reforming such farms, established during the 1950s as the government organized large-scale efforts to develop wasteland.

There are more than 1,700 State farms, accounting for about 5 percent of China's total arable land, and with State-owned assets worth over 750 billion yuan ($118 billion), according to the Ministry of Agriculture.

They have long been beset by lack of incentives, rigid management and heavy fiscal burdens as they are also responsible for local public services such as healthcare and education.

The reform will help the farms separate government and social functions from enterprise management and prevent losses of State-owned assets, the statement said.

Attendees of the meeting also approved a plan to make the taxation system more efficient and more convenient for tax payers.

The reform will address overlaps between state and local tax departments, according to the statement.

A document on how to categorize State-owned enterprises (SOEs) was also approved.

Coming about a month after central authorities released guidelines promoting mixed ownership of SOEs, the document said they will be divided into two categories, for-profit entities and those dedicated to public welfare, and undergo reforms in line with their purposes.