China’s eastern province of Zhejiang will remove restrictions on household registrations in most areas except for the capital city of Hangzhou in a move to foster income equality and spur economic growth.
(Bloomberg) — China’s eastern province of Zhejiang will remove restrictions on household registrations in most areas except for the capital city of Hangzhou in a move to foster income equality and spur economic growth.
China’s household registration system, known as hukou, restricts people from accessing government services outside the area where they are registered. Location of registration is generally determined by parents’ legal residence at time of birth.
The new policy, which is part of the efforts by authorities in Zhejiang to achieve “common prosperity,” will take effect July 22 and last for five years, according to a statement posted on the local government website July 3. The increased mobility may also act as a growth driver as the world’s second-largest economy struggles to recover from a Covid-driven slump.
China should reform its household registration system to unleash the consumption potential of its vast migrant workers, Cai Fang, a policy adviser to the central bank was reported as saying earlier this month. In 2019, China’s National Development and Reform Commission called on cities with populations under 3 million to get rid of hukou restrictions.
–With assistance from Tom Hancock.
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