Marked achievements in population urbanization since the establishment of the new China have been highly acclaimed by the international community; however, problems have also emerged, including incidences against natural laws during the first 30 years with a command economy, and new problems have built up after the Reform and Opening Up and have presented themselves most prominently when it comes to the relationship between a walled area and the “city/market” with a risk of losing the latter.

Abstraction of the concept of urbanization may lead to separation of the “city/market” from walled areas, and the latter may seemingly develop in a way independent of the former. Thus the intrinsic connection between walled areas and cities is severed from the root, and the foundation of building walls, i.e., cities with civil functions, is also lost.

In terms of the connotations of urbanization, a city decides the natural boundary of the walled area, and when the functions of a city are lost, the boundary may be arbitrarily decided by people. In practice, abstraction of urbanization by removing the concept of the “city/market” from it sets cities and towns free from the reach of civil functions, blurring the line between normal urbanization and man-made urbanization since walled areas are now walled areas on their own, and cities are cities on their own while neither needs the other for survival. Things may be further ridiculed to a degree that reversed urbanization emerges in that walled areas are built first and cities generated next.

The reform of urbanization to improve cities shall always honor the principle of “human orientation.” It should also be clearly understood that the goal of urbanization is to meet the growing need of urban and rural residents for all-around development, that human capital is the most important engine to drive urbanization, and that the upgrade and transition of urbanization are to bring urbanization to the sustainable development of the population, economy, society, resources, and environment.

The key to the success of upgrading urbanization lies in a clear understanding of whether cities or towns are needed, and once the concept of urbanization is reduced to its very fundamental idea, the dual institution that divides urban and rural areas is to be demolished, the relationship between the government and the market straightened up, and the decisive role of the market on resource allocation and guidance by the government fully exerted. In addition, rural residents shall be facilitated to become urban residents on the basis that they enjoy equal rights as all other urban residents on household registration, employment, education, medical services, housing, and old-age security.

When it comes to rural arable lands, it must be acknowledged that circulation of land use rights is a way to modernize agriculture and an important tactic and measure to coordinate urban and rural development, on one hand, and, on the other hand, problems during the practice of land circulation must be taken seriously with a deep understanding that without satisfying solutions to these problems, the practice of land circulation will derail, which will not only harm the rural economy but the progression of urbanization as well.