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Finding New Pastures

Rural areas are providing incentives to young people to return and start businesses beyond agricultural production. Some are very successful, yet others struggle with investment, attracting staff and declining standards amid a rash of competitors

By Xu Ming Updated Dec.1

Villagers and tourists dance together in Damiao Village during a traditional Miao festival, August 13, 2022

Zhou Jing in her fig orchard, Bairuopu Town, Changsha, Hunan Province, July 10, 2021

On September 25, a sunny autumn day, fig orchard owner Zhou Jing greeted a group of children and their parents. After she gave them a tour and explained how figs grow, they set off to pick some fruit. Entrance is free, but visitors pay for what they pick. 
More farms are starting pick-your-own side businesses, which increases incomes and provides more employment opportunities in villages which may have become moribund due to outmigration of residents to urban areas. Zhou, who lives in Datang Village of Bairuopu Town, in Changsha, Hunan Province, has become an ambassador for her town, promoting fresh and processed agricultural products and leisure activities on livestreams with her friends. She is hopeful it will point the way forward for rural areas. 

At her busiest, Zhou gets 200 visitors a day, when the figs are ripe between July and November. She earns between 200,000- 300,000 yuan (US$27,800-41,700) from the picking business alone, as her orchard has become a popular tourist destination. She also sells her figs to local customers and online, getting orders through platforms like WeChat, Xiaohongshu and Douyin, China’s TikTok. The majority of visitors come through these social networks, Zhou said.  

Zhou’s business, which distinguishes her from traditional farmers in her village, is common in China’s rural areas today. New business models have taken root, including e-commerce, leisure agriculture, food and other agricultural product processing and tourism. Privately or collectively owned enterprises are mushrooming as China embarks on diversifying rural industries, part of its rural revitalization strategy.  

A report published by Xinhuanet.com in June shows that in 2021 the number of farmers with new jobs in rural areas surpassed 20 million and the number of family farms (or large-scale planters) reached 3.9 million, while that of village-owned cooperatives totaled 2.2 million. Capital investment in rural industries exceeds 1 trillion yuan (US$139b) every year. 

Thriving Township 
Zhou, now 33, ran a hotel in Changsha after she graduated from college. But she saw opportunities grow in her hometown as tourists came. In 2017, Zhou returned to her village and started her fig tree business, which allowed her to work and take care of her children. After five years, she has 110 mu (7.3 hectares) of fig trees, as well as mulberry and watermelon.  

Last year, she built a processing plant to increase sales and reduce waste. “It’s a big headache when production exceeds demand. We used to suffer big losses because of that,” Zhou said. Now she produces dried fruits, fruit tea and other products from her excess crop, or from fruits deemed too “ugly” to sell. Her factory helps other farmers too, and they feel safe to expand their acreage. Now the business provides jobs for about 20 village women, integrating planting, processing and countryside tourism.  

In Bairuopu Town, there are over 30 young people like Zhou who saw the development momentum in the countryside quicken. Encouraged by the local government, which has significantly boosted industrial development, they decided to return home to start their own businesses.  

Zhou’s friends and contemporaries, Liao Hong and Xia Sainan, also started rural agricultural businesses. After graduating college, Liao managed a restaurant and a wet market in Changsha. But when she saw how much her hometown had improved, Liao decided to return, despite warnings of hardships from family and friends. “Besides, as a mother, I also hoped to help the left-behind children in our village. Their lives will be better if their parents have work opportunities at home,” Liao told NewsChina.  

After she returned to Longtang Village at the end of 2019, she built a cooperative with the village and plants 260 mu (17.3 hectares) of snake gourd, which is eaten or used in traditional medicine, particularly the seeds. The village takes 40 percent of the cooperative’s profits and provides necessary services like irrigation and coordinating with villagers. Liao sells fresh gourds and dried and packaged seeds online, and she helps impoverished families by providing jobs. At the end of the year, villagers get dividends from the cooperative. In 2021, villagers working at the farm earned 400,000 yuan (US$55,600) in total, in addition to 30,000 yuan (US$4,170) in dividends. 
Xia Sainan, who started growing vegetables with her dad after she graduated college in 2014, has developed her business into a successful vegetable farm that also provides pick-your-own activities and education about the natural world.  

The three friends developed a livestream business, and are known as “the three beauties of Bairuopu.” They livestream at least once a week and make videos to promote local products and talks about the lives of local entrepreneurs.  

Bairuopu Town administers 14 villages altogether. New industries sprouted in the town in 2008 when one of them, Guangming Village, was listed as a provincial-level model village and started to develop tourism. Nearby villages followed. Now there are nearly 20 local cooperatives and companies in the town engaged in large-scale planting, food processing, leisure agriculture, family farms, theme parks, education, camping and other leisure businesses.  

Liu Bin from Huaihua, Hunan Province, owns Bailu Camp, an outdoor sports center, He came across Guangming Village when he participated in a bike race in the area 10 years ago. At first he just wanted to find a place for his family to escape the hustle and bustle of city life. A big fan of outdoor sports, Liu rented unused houses and developed his outdoor pursuits center, which offers outdoor survival education for kids and team-building activities for adults. More than 300,000 tourists have visited since he opened. 

In the last two years, Bairuopu has improved the living environment to entice young people back. The villages help to find suitable businesses, rent land and provide necessary infrastructure to stimulate industrial development. Banks offer loans at discounted rates. The town has an entrepreneur center so young entrepreneurs can exchange ideas, and it organizes guidance and training. The center holds workshops, lectures and training courses in video making and e-commerce, and arranges exchange visits with other places that have successful rural businesses.  

By 2020, Bairuopu received over 700,000 visits and earned 200 million yuan (US$27.8m) from tourism, creating jobs for over 1,900 farmers and the town’s per capita income rose to 38,000 yuan (US$5,257) a year. In 2021, income from village-owned collectives totaled 10.03 billion yuan (US$1.4b). The same year, the town was listed by the Ministry of Agriculture and Rural Affairs (MARA) as a national-level model township for developing leisure tourism as its leading industry. 

Villagers pick marigolds in Damiao Village, Yiliang County, Yunnan Province, August 6, 2022

A farmer picks mushrooms in his greenhouse in Zhangye, Gansu Province, September 6, 2022

Workers can peaches in a food processing plant in Shijiazhuang, Hebei Province, July 29, 2022

Back to Rural Business 
In China, more than 3,600 villages and towns like Bairuopu have successfully developed pillar industries and integrated primary, secondary and tertiary industries.  

Since the launch of the rural revitalization strategy in 2017, rural industries have been regarded as “the foundation to realize rural revitalization and the precondition of solving all rural problems,” as stressed in the State Council’s guideline issued in 2019. The guideline encourages capitalizing the diverse functions and values of rural areas to cultivate and expand rural industries, and stimulates the issuance of supportive policies in fiscal investment, financial support and tax preferences. In 2022, the central government’s subsidy for rural revitalization totaled 165 billion yuan (US$22.8b) and over half of it will be used for industrial development, a MARA official said in a press conference held on September 28.  

This has significantly changed the economic landscape of the Chinese countryside. Industries that center around planting of cash crops, e-commerce, agricultural product manufacturing and rural tourism are growing in many regions.  

Haitong Township of Puyang County, Henan Province, along the Yellow River, was an impoverished township. But now it is a popular tourist destination famous for lotus gardens, taking advantage of the readily available water resources. From July to October, the town gets more than 10,000 visitors a day.  

Farmers were encouraged to plant lotus and sell the roots in 2013. When countryside tourism became trendy, the township built an extensive lotus garden in 2015. Now tourism has turned to other ventures including ornamental koi carp breeding, walnut and rice planting and food processing. In total 37 cooperatives and 56 family farms have been established, and the 650 mu (43.3 hectares) of ornamental koi alone earns farmers over 20,000 yuan (US$2,780) per mu.  

In 2018, Li Shuchang came back to Haitong Town and built Dongsen Industrial Park with support from the township government, which mainly produces daily use products like tissue and laundry detergent. In 2020 he established a professional e-commerce center which trains locals in ecommerce and is an important channel for local agricultural products to reach a larger market. The industrial park provides over 300 jobs.  

Changes are also happening in remote mountainous villages. In Damiao Village, Yiliang County, Yunnan Province, a new coffee shop is popular with young people, and some have become skilled baristas. A year ago, the Miao ethnic village was still impoverished and people lived under the same roof as their livestock.  

In 2021, the village was chosen as a pilot site for Yiliang County’s poverty alleviation efforts. With government support, the village built a collective tourism enterprise and embarked on rebuilding houses, roads and other modern facilities such as the coffee shop, public toilets, hotels, convenience store and children’s play facilities. Visitors experience Miao culture and see demonstrations of traditional crafts like wax printing. They planted marigolds on a hillside that they can sell and also to take advantage of the craze for photography and Insta-culture.  

Some residents who worked away were encouraged to return, participating in construction and training courses that help them run the new businesses. Between June, when the village opened to tourists, and September, turnover reached over 900,000 yuan (US$125,100).  

Li Shanmei, a county official tasked with helping the village, told NewsChina they plan to plant turnips in winter after the marigolds are harvested and build a processing plant to make dried turnip. As a local dish of fried pork proved popular, they hope there will be more pig raising and meatpacking plants in the future.  

More places are tapping their resources, improving the commercial environment and attracting talents to get on the bandwagon. In September, Gu Guoming, head of Dongwangzhuang Village of Laiwu, Shandong Province, is busy leading the villagers to clean up the rivers and the village environment. He wants to develop it as a tourist hotspot. The village’s roads and toilets were improved in the past two years, part of the national campaign to improve living standards in rural areas.  

In 2018, Gu, who also manufactures mats and rugs, came back to the village as Party secretary and introduced the hand-knit braided rug business to the mountainous village. “It doesn’t demand much in technique, and it’s suitable for elderly people and women who have to stay at home taking care of children,” Gu said.  

The mats they make to put under drum kits are exported to countries like Belgium, the US, Russia and many Southeastern Asian and African countries via Alibaba. This cross-border business earns each villager up to 4,000 yuan (US$556) a month during peak seasons. The revenue from the workshop is reserved for village construction and dividends for villagers. In 2021, sales totaled 5 million yuan (US$695,000). Each villager received dividends worth 4,000 yuan (US$556) earlier this year.  

But Gu believes tourism is a better way, and he is planning to build a collective enterprise to develop tourism based on the village’s natural and historical resources. He told NewsChina that the village used to be a location for strategic manufacturing like vehicles and telecom equipment in the 1960s, but this ended in the 1980s.  

“Over 400 young people came here to work for the country under arduous conditions. We have old plants and sites that are of great historical value. We should protect and pass on the relics to the next generation,” Gu said. They have repaired the buildings and Gu wants to turn them into a museum of telecommunications.  

“The village also boasts over 10,000 mu of forest and two ancient trees over 600 years old that we can make use of,” Gu said. He is passionate when talking about his plans, explaining he has contacted a professional to help make a blueprint based on the resources the village has. “We want to turn the resources into capital and let villagers be the shareholders and eventual beneficiaries,” he added.  

Social forces including universities and companies are also playing an important part in boosting rural industries, particularly in cultivating professionals, which is essential for rural development.  

Li Xiaoyun, executive vice dean of China Agriculture University’s Rural Revitalization Research Institution, has been engaged in building pilot zones for rural revitalization in many villages in Yunnan Province. His team, consisting of teachers and graduate students, participated in the redevelopment of Damiao Village, from design to training villagers. Some of his students are still there.  

In 2021, the university launched a program with internet giant Tencent to train managers. In 2018, Tsinghua University and social organizations including the China Charity Alliance launched the Leader Plan to empower new farmers primarily aged under 45 to start village enterprises. By the end of 2021, the program trained nearly 100,000 new farmers from 31 provinces and cities.  

At a press conference held in June in Beijing, Deng Xiaogang, vice minister of the Ministry of Agriculture and Rural Affairs, said that rural areas have made marked progress in agricultural produce processing and circulation, countryside tourism, ecommerce, the integration of multiple industries and rural business startups.  

In the past 10 years, the number of market entities engaged in leisure farms and agritourism reached over 300,000, with turnover surpassing 700 billion yuan (US$97.3b). There are more than 30,000 e-commerce companies involving agriculture, whose online sales of agricultural products totaled 420 billion yuan (US$58.4b), while 140 industrial clusters and 250 national modern agricultural industrial parks and 1,300 towns strong in multiple industries have been established, Deng said.  

In 2021, per capita disposable income of China’s rural population reached 18,931 yuan, a rise of 125.7 percent over 2012, data from the National Bureau of Statistics shows. 

Problems and Worries 
But there are still constraints on rural industries, such as short industrial chains and low added value of agricultural products, as pointed out in the report published by Xinhuanet.com, and the quality of agricultural products and rural tourism services is not high in general.  

Part of the problem is the excessive pursuit of scale in developing characteristic agriculture or other industries, said Jiang Changyun, a researcher with the Chinese Academy of Macroeconomic Research in Beijing. “As the scale expands, problems surface. For example, the production of certain characteristic agricultural products expands from suitable regions to less suitable ones, causing a decline in overall quality and weakening competitiveness,” Jiang wrote in an article published in the Journal of Nanjing Agricultural University in early 2022.  

This problem extends to non-agricultural businesses in rural areas. Jiang pointed out that in recent years, the integration of primary, second and tertiary industries in rural areas has been fast and played an important role in increasing incomes. “But in the process, problems like homogeneous competition between regions and overcapacity emerged,” wrote Jiang, adding that the problem is particularly prominent in leisure agriculture and rural tourism, which, once proved lucrative in some places, was widely copied, leading to wider devaluation in the industry and dilution of standards.  

“Some places invested in tourism but failed to provide quality services to attract tourists. Some just rashly follow and copy others without doing enough to exploit the market, cultivate characteristic products or study the changes in supply and demand,” Jiang noted.  

“Now almost all rural areas want to count on leisure agriculture and rural tourism to get rich. But to succeed one needs to stand out among others and be able to transition in time,” He Xuefeng, director of Wuhan University’s School of Sociology, wrote in an article published in the Changchun-based Guandong Journal. He cited Hesilu Village of Yiwu, Zhejiang Province, which was the first to plant flowers to attract tourists in the province and later made a successful transition to catering, accommodation, handicraft production and educational training.  

“The village doesn’t plant lavender anymore. In Zhejiang there are over 2,000 places planting a sea of flowers now. The competition is very fierce, no good for anyone,” He said. “On the other hand, the total potential tourism market is limited. If every rural area decides to invest in tourism, the majority will inevitably lose out.”  

The large-scale promotion of non-agricultural business also worries some experts. “The limited arable land should ensure food safety first before it’s used for industry. But some places simply take reducing food production as an industrial structure,” Wei Houkai, director of the Rural Development Institute, Chinese Academy of Social Sciences, noted during a dialogue about rural revitalization held by China Agriculture University in May.  

Yet compared with suburban and coastal villages or villages in developed eastern regions, shortages of capital, talent, technology support and markets are still a dilemma for the majority of rural areas in central and western China.  

Gu Guoming told NewsChina that he now faces the headache of getting funding for his museum and to find qualified staff to join him. Of the 400 villagers, half are over 60. That is why their village rug workshop cannot process big orders that require an assembly line.  

Every summer, Gu invites volunteer college students from the village to come back to tutor the children. He hopes they will become more attached to the village.  

Gu admits that developing a village is challenging and takes time, and he knows he needs to take it slowly. “It is a village, not a company. So many people are involved. I can’t afford to lose,” he said. 

Holding Fast 
Li Yuehua, a 29-year-old from Damiao Village, is becoming more like a professional cook. He used to work in urban factories, but he returned in 2021. He rented the first floor of his house to the cooperative as a restaurant and started learning how to make local dishes and manage the business. Now he has persuaded his father to add another floor to his house to be a homestay. He is optimistic when he talks about the future.  

But not everyone in the village shares his hopes. He is one of the few young people who came back and stayed. Li Shanmei told NewsChina that a number of young people returned at the start of the tourist venture, but they soon left after finding they were paid only 2,500 yuan (US$347.5) a month, much lower than factories offer. Li Shanmei admitted that village jobs need time to grow to be more appealing.  

When business is not so good, some of the others waver too. When winter starts to bite in the hilly village, visitors and incomes dwindle. “We need to get past the winter, and if we can, we’ll succeed,” said Li Shanmei.  

After farming for two years, Liao said she is more rational about coming back to the village now, realizing it is not so easy investing in land. The drought that scorched central and southern China this summer caused considerable losses to her snake gourd crop. “Agriculture is risky. And whatever the result, the cost is fixed,” said Liao.  
She has already invested 2 million yuan (US$278,000) to cover the rent, facilities and management, but she has yet to make it back.  

“When I came back three years ago, I expected I’d be in profit in three years. Now, probably six years,” Liao said with a wry smile.  

“For those who want to come back, I’d say that not everyone is suited to creating a rural business. It will be hard if you don’t have sufficient experience and financial support and, mostly important, a love for it,” Liao said. But in spite of the difficulties, Liao said she still believes she is in the right place.  

Zhou said her fig orchard has started to turn a profit, though not so much. Next she plans to develop more products from her fruits and increase their value added. “I’m happy to play a part in the local industry and enrich it,” she said. “Now since I’ve chosen to do it, I’ll try to do it well. I hope people can see the persistence and power of young people in me.”