(Yicai) Aug. 2 -- China will launch a new campaign to promote the migration of residents to urban from rural areas as a key drive of economic growth, aiming to raise the country’s urbanization rate to 70 percent in five years.

To achieve such goal, China will relax its restrictions on the local household registration system, also known as hukou, expand social security coverage for rural workers moving to cities, meet their housing needs, and guarantee education to their children, the State Council said in a document released on July 31.

China’s long-term urban population accounted for 66 percent of the total last year, up from 53 percent in 2012, according to official data. The country achieved its urbanization rate target of 65 percent set in the 14th Five-Year Plan (2021-2025) two years in advance.

China has been gradually easing restrictions on the hukou system in recent years. In the future, cities with less than three million long-term residents will fully lift the restrictions, those with between three and five million long-term residents will ease the curbs, and those with more than five million long-term residents will be encouraged to cancel the annual hukou registration quota, the document showed.

Beside easing hukou registration curbs, China’s cabinet also proposed increasing the supply of government-subsidized rental houses for rural migrant workers and offering large fiscal support to cities welcoming more immigrants.

China is promoting local governments to purchase unsold residential properties to adapt them for affordable housing to boost the weak property market. With the release of the new document, the local governments will accelerate the implementation of such move, Chen Li, a property industry analyst at Huafu Securities, told Yicai.

Only 48 percent of the Chinese population is recognized as urban residents by the government, Niu Fengrui, director of the Small and Medium-sized Cities Research Institute, told Yicai. The figure is about 18 percentage points below the urbanization level, which means about 250 million rural migrant workers do not have the hukou in the cities they work, Niu explained.

For every 1 percentage point increase in urbanization rate, China’s investment and construction needs surge by about CNY1 trillion (USD138.6 billion) and CNY200 billion (USD27.7 billion), respectively, Zheng Shanjie, director of the National Development and Reform Commission, said at a press conference during the annual plenary meetings of the National People’s Congress and the Chinese People’s Political Consultative Conference in March.

Editors: Dou Shicong, Futura Costaglione