Renovating farmhouses to promote shared prosperity
Windmills, valleys, forests, seas of clouds… Visitors rush to capture the beauty of these breathtaking sights with their smartphone cameras from the terraces of a popular luxury bed and breakfast located in Paifang village, Gaozhai Bouyei and Miao township, Kaiyang county, Guiyang city, Guizhou province, in southwest China. Once a hidden gem, the establishment is now so popular that getting a room can be a challenge. Beyond boosting local tourism, it also symbolizes a new development model known as “70+20+10,” which refers to 70% of a B&B’s profits going to the company that is in charge of operations, 20% going to local residents, and 10% going to the local village collective. The strategy provides a new way for rural residents to increase their incomes and vitalizes the economy in the areas it is implemented in.
Not long ago, however, the B&B, which has generated a lot of buzz online, was nothing more than a collection of dilapidated farmhouses that had been left idle for years because their owners had been living and working in more-prosperous areas. In 2019, Kaiyang launched a major renovation project designed to facilitate the vitalization of the farmhouses, however, which was the start of their transformation.
The county introduced a development model known as “60/20/20+10” and began piloting it in villages located in two of its townships – Hefeng and Nanjiang Bouyei and Miao. Residents of the villages it is implemented in gain shares in the undertaking by contributing their unused buildings, and a hospitality company manages renovation work and operations. The model’s name comes from a corresponding profit-sharing agreement in which 60% of profits go to private investors, 20% go to local residents, and 20% go to a platform company that facilitates interactions between the groups that are involved, with 10% of the platform company’s profits going to the village collective, that is implemented.
“Today, over 70 homestay operations exist in our village, 20 of which are run by model rural tourism households that also engage in other forms of agritourism,” an official working in Nanjiang’s Longguang village named Tao Damo noted in late August 2024. “They have created over 120 jobs in Longguang, and the overall tourism industry has raised per capita income by RMB35,000 (approximately US$5,000) in the village.”
In recent years, Kaiyang has piloted various models designed to enable the utilization of idle rural buildings. The county has attracted over RMB10 million (US$1.42 million) in private capital promoting models like “70+20+10” and “60/20/20+10,” which has made it possible to renovate 1,800 farmhouses into usable hospitality facilities and vitalize 230 idle homes located in all 18 of its township-level administrative areas.
Cooperative ownership in conjunction with other entities enables village industries to thrive
Gaozhai township’s Gaozhai village faced numerous setbacks before it succeeded. A few years ago, a meeting themed on potential establishment of a cooperative was held in the village, but many residents who attended were skeptical.
“‘None of the collective undertakings that have been attempted have ever succeeded, so what’s the point?’ they asked,” Gaozhai Village official Tian Chao recounted, their frustrations still fresh in his mind.
Before 2021, collective efforts to pursue undertakings like daylily and hedged gourd farming ended in failure. The village’s collective economy was stagnant, with no operating income or capacity to drive development.
“The main reason the collective economy wasn’t doing well was a lack of motivation,” Tian explained. “Neither village officials nor regular residents held any shares of collective organizations, so no one felt responsible for its success.”
In 2022, the village began exploring a new model known as the “1+1” model, which refers to the “rural collective joint-stock economy + other economic entities.” The village cooperative invested RMB490,000 (US$69,580), while village officials and regular residents contributed a total of RMB210,000 (US$29,820), which resulted in the former receiving 70% of the shares of a new chili pepper farming company and the latter obtaining 30%.
The new ownership structure significantly boosted the sense of responsibility of all parties that are involved. Shareholders became invested in the success of the undertaking and began actively learning about corresponding farming techniques, management methods, and markets, and their efforts paid off. In 2022, the new chili pepper company generated RMB480,800 (US$68,270) of profit, which enabled the village to issue dividends to its residents for the first time. In 2023, the company’s chili pepper farm expanded to 70 ha, it achieved RMB2.72 million (US$386,240) of revenue and RMB1.04 million of profit, and the number of farmers who were participating in the endeavor had grown to 661.
Kaiyang's collective economic system has improved since the “1+1” model was adopted in 2022, which has helped ensure sustainable growth in its villages. As of 2023, all 111 of its villages were generating at least RMB50,000 (US$7,100) of collective operating income, and 28 of them had surpassed RMB500,000 (US$71,000) of collective operating income.