Full text: China's Rural Roads in the New Era

III. More Coordinated, Standardized and Efficient Rural Road Governance

Effective rural road governance means not only building good roads but also ensuring their proper management. Based on the current situation and with a long-term perspective, China has accurately grasped the principles, trends, and characteristics of rural road development, and established robust systems, mechanisms, policies, and regulations, continuously enhancing its governance capacity of rural roads.

1. Building a Complete System of Laws, Regulations and Policies

China is committed to improving the effectiveness of its governance and management. It adopts a problem-oriented approach to furthering reform of rural road management systems and mechanisms. By strengthening legal and policy frameworks and ensuring adequate allocation of key factors, it has gradually established a robust governance system for rural roads.

Improved laws and regulations. China attaches great importance to legislative work on rural roads and has promulgated a series of relevant laws, regulations, and policies. The Highway Law of the People's Republic of China, enacted in 1997, and subsequently amended five times, regulates the planning, construction, maintenance, operation, use, and management of roads, including county and township roads.

In 2011, the Regulations on the Administration of Highway Safety were promulgated, clarifying the work of law enforcement patrols, illegal construction clearance, and the management of vehicles with out-of-gauge goods and/or overloaded vehicles. Currently, China is actively promoting the formulation of the Regulations on Rural Roads. All provinces and equivalent administrative units nationwide have promulgated local road or rural road regulations. Departmental regulations such as the Administrative Measures for Rural Road Maintenance and the Provisions on the Administration of Road Passenger Transport and Passenger Stations have also been promulgated. A legal system for rural roads has been formed, with national laws as the base, administrative regulations as the spine, and local and departmental regulations as support.

Refined policies and systems. China has issued over 20 policy documents, including the Guiding Opinions on Promoting the High-Quality Development of Rural Roads in Their Construction, Management, Maintenance and Operation, and established a policy and institutional system that addresses systemic, organizational, supervisory, funding, evaluation, and service aspects of rural road management.

Placing a strong emphasis on accountability, it has issued the Opinions on Deepening Reform of the Management and Maintenance System for Rural Roads, stipulating that provincial and municipal governments should strengthen overall planning, guidance and supervision, and county-level governments should fulfill their primary responsibilities. A detailed list of powers and responsibilities over the management and maintenance of rural roads has been established for relevant departments at the county level and township governments, forming a collaborative working dynamic ensuring close coordination and joint efforts at all levels.

A road chief system for rural roads (see Panel 4) has been implemented, designating county, township-level administrative heads and village (neighborhood) committee heads as road chiefs to ensure cross-departmental coordination, thereby promoting the efficient implementation of the government's primary responsibilities, and gradually transforming rural road management from an extensive, passive, and fragmented approach to an intensive, proactive, and collaborative one.

2. Developing a Diversified Funding Mechanism

The development of rural roads relies heavily on funding, particularly from the central and local governments, whose fiscal contributions are essential to ensuring the rapid development of China's rural roads. Governments at all levels have maintained close coordination and a unified approach, gradually establishing a rural road funding mechanism characterized by government leadership, tiered responsibilities, diverse funding sources, and procedure-based and efficient management. This approach has effectively addressed the challenges of securing adequate funding for rural road projects.

Clarifying the fiscal powers and expenditure responsibilities for rural roads. Reforms have been introduced to divide fiscal powers and spending responsibilities between central and local governments in the transport sector, with rural roads explicitly designated as a local fiscal power. By refining and specifying the fiscal powers and spending responsibilities of governments at all levels regarding rural roads, China has addressed the long-standing ambiguity surrounding these fiscal responsibilities. To support local governments facing funding gaps in fulfilling their fiscal powers and expenditure responsibilities for rural roads, higher-level governments will provide financial support based on evolving development goals.

Increased financial support from governments at all levels. Government funding plays a crucial role in the construction and maintenance of rural roads. The central government has allocated funds through various channels, including the vehicle purchase tax revenue, central budgetary investment, and transfer payments from the reform of taxes and fees related to refined oil products. Provincial, municipal, and county governments have also increased their financial support to rural road development. Local governments have incorporated the operating expenses and basic personnel costs of rural road management agencies into their general public budgets and have prioritized rural road development in their general bond issuance plans. A minimum annual maintenance funding standard of RMB10,000 per kilometer for county roads, RMB5,000 per kilometer for township roads, and RMB3,000 per kilometer for village roads has been implemented. The central government has also provided guidance to local governments to maximize the effective use of rural passenger transport subsidy funds. Over the past decade, a cumulative investment of RMB4.3 trillion has been made in rural road fixed assets, and RMB1.1 trillion has been invested in maintenance, with approximately 80 percent of the total funding in either category coming from the government. The central government contributes RMB8.9 billion annually in subsidies for rural passenger transport.

Expanding financing channels through diverse market-based methods. China has fully leveraged the critical role of market-based financing mechanisms in rural road development and actively expanded financing channels. In line with local conditions, all localities have developed innovative "rural road plus" investment and financing models by integrating rural roads with commercial projects in relation to industries, industrial parks, rural tourism, and other economic activities (see Panel 5). To support rural road maintenance, the government has incorporated road management and maintenance in the procurement services guidance catalog and explored mechanisms such as disaster insurance for rural roads. It has also encouraged various financial institutions to increase their support for eligible rural road construction projects within the bounds of laws and regulations. Over the past decade, approximately RMB800 billion in credit funds from various financial institutions have been allocated to rural road development nationwide.

Strengthening oversight and efficiency in the use of rural road development funds. China has improved the transfer payment system for subsidies to local governments from the vehicle purchase tax revenue, as subsidies for rural road construction are now provided as a type of rewards for good local performance (see Panel 6). All public funds allocated to rural roads are subject to full-cycle budget performance management, ensuring efficient utilization of rural road funds. China has strengthened oversight over the use and management of rural road funds. A responsibility system has been established to ensure accountability for those who apply for funds and those who use them, guaranteeing the full and actual disbursement of funds. Relevant information is disclosed in accordance with applicable regulations for public oversight. China has also intensified debt risk prevention and control for rural road projects, ensuring that debt financing is raised in accordance with laws and regulations.

3. Increasing Governance Efficiency Through Digital Transformation

Digitalization helps improve governance capacity for rural roads. By adhering to the principles of comprehensive planning, demand-driven development, collaboration and sharing, and safe and applicable technology, China has promoted digital transformation across the entire lifecycle of rural roads, including construction, management, maintenance, operation, and services. This transformation has supported the development of a modern rural transport system.

Solidifying the digital foundation for rural roads. China has implemented a series of statistical survey systems, including the Rural Road Infrastructure Statistics Survey System, the Road Maintenance Statistics Survey System, and the Road Transport Statistics Survey System. Through regular monitoring and data collection, it has established a comprehensive infrastructure database, enabling the online management and monitoring of all processes related to rural road construction, management, maintenance, and operation. As a result, statistical surveying, monitoring and management of rural roads have been improved through a digital and smart transformation. It has also initiated a "one road, one file" information system for rural roads, ensuring that basic data for each road can easily be found online. This initiative has enabled integrated management for rural roads.

Expanding digital application in rural road management. By combining basic data with information on technical conditions, maintenance operations, funds allocation, emergency dispatch, the road chief system operations, statistical management, and travel services, China has facilitated information interconnectivity and sharing. It has applied advanced information technologies such as the Internet of Things, satellite remote sensing, cloud computing, and artificial intelligence (AI) in rural road management. Through active exploration of application scenarios such as AI-powered automated inspections, unmanned aerial vehicle inspections, intelligent road network monitoring, intelligent maintenance, intelligent disaster early warning, and big data-driven decision-making and analysis in rural road management, China has steadily increased the digitalization level of rural roads.

4. Driving Overall Improvement Through Demonstration and Pilot Programs

By establishing demonstration projects, conducting pilot programs, and building business brands, China has facilitated the creation of leading models that drive the overall development of rural roads.

Promoting demonstration projects. To encourage best practices and innovation, China has organized various demonstration programs, including the creation of national model counties for high-quality rural roads that are properly built, managed, maintained, and operated and model counties for rural-urban transport integration (see Panel 7). Since 2018, it has designated 545 counties as national model counties for high-quality rural roads and 102 for integrated rural-urban transport. It has intensified its efforts in documenting and rolling out successful models, resulting in the creation of over 100 exemplary cases and 150 rural logistics service brands in areas such as the road chief system, information technology applications, financing, integration of transport and tourism, integration of passenger, freight, and postal services, and the promotion of common prosperity.

Intensifying pilot programs. Pilot programs serve as an essential tool in exploring development paths and increasing management efficiency. In alignment with the goal of building up its strength in transport, China has launched 15 special pilot programs for high-quality rural roads. These pilots explore new paths for the high-quality development of rural roads in different regions and sectors, covering aspects such as policy measures, systems and mechanisms, technological innovation, integrated development, and disaster insurance. It has identified 167 government agencies in piloting reform of the management and maintenance systems of rural roads. These agencies focus on eight key areas: the road chief system, innovative maintenance models, IT-based management, beautiful rural roads, financial guarantees, innovative investment and financing mechanisms, credit rating mechanisms, and government performance evaluation. The goals are to fulfill rural road management responsibilities, improve management mechanisms, and create innovative management models.