International Social Science Journal (Chinese Edition)

No.2, 2025

 

 

Wan Li and Xu Liquan

 

The new national urban renewal strategy introduced in China in 2020 signifies a major change in urban development policy, shifting the driver of urban growth from new physical expansion toward the renewal of existing urban stock. Urban renewal is closely linked to the phenomenon of “deindustrialization,” which refers to the situation where some industrial cities face spatial decline, contraction, or even complete abandonment due to industrial contraction. Urban renewal promotes the transformation of cities from production-centric to consumption-, culture-, and service-centric through resource reallocation and spatial restructuring, thereby addressing the challenges of contraction. Western experience demonstrates that medium-sized and small industrial cities, in particular, must prioritize the significance of employment opportunities in urban renewal when addressing the issue of contraction. With changes in the international environment and the increasing costs of large-scale transfers of production factors, most medium-sized and small cities in China are also facing pressures of population and industrial contraction, with some cities exhibiting deindustrialization phenomena. Critically applying Henri Lefebvr’s theory on the production of space, this paper conceptualizes urban renewal as a process of capital reproduction. This process requires continuous spatial transformation, i.e. how capital transitions effectively between the “first circuit,” the “second circuit” (real estate, finance and insurance) and the “third circuit” (knowledge and social expenditures), thereby driving urban renewal. The study examines the spatial transformation logic of urban renewal from a theoretical perspective, pointing out that the key challenges facing urban renewal in China’s small and medium-sized cities lie in recognizing the non-homogeneity of renewal pathways and adhering to a long-term approach to the development of the real economy. Finally, it proposes development strategies across three dimensions: encouraging policy innovation, anchoring industrial sectors, and upholding social justice.