May 30, 2000
Many Chinese industries anticipate significant challenges after the country joins the World Trade Organization, and Chinese farmers are no different. Finance Minister Xiang Huaicheng said recently that the government will further strengthen the nation's agriculture to support and protect this sector following China's accession to the WTO, the Zhongguo Xinwen She (Chinese Overseas News Agency) reported on May 24.
Xiang explained that according to the stipulations of the WTO Agricultural Agreement, once China joins the trade group, the country must improve market-access opportunities for imported agricultural products, which will produce severe challenges to its agricultural sector.
The minister pointed out, however, that China may invoke the agreement's protective clauses—namely its "Green Box" policies—to support and protect its agriculture, the news agency noted. The WTO's Green Box accords refer to domestic agricultural-support policies that are not subject to reduction commitments. These policies are assumed to affect trade only minimally, and they include support such as research, food security stocks, disaster payments and structural adjustment programs.
Because of this, Xiang said, China will shift from its traditional and direct methods of protecting farmers through high tariffs and price supports to indirect, Green Box-type policies, the news agency reported.
Xiang emphasized that implementing the comprehensive development of China's agricultural sector consists mainly of boosting the construction of its infrastructure, protecting and improving the environment, and developing high-quality, high-yield and highly efficient agriculture.
The minister said these methods do not conflict with the WTO's requirements on Green Box policies. China began developing its agriculture comprehensively in 1988 through land resource development and land-harnessing projects, diversified business operation projects and demonstration projects, according to the news agency.
In roughly the past decade, these efforts have boosted the nation's annual average grain production by 53.17 billion kg (117.2 billion pounds). Similarly, the average annual increase in farmers' per capita net income in areas where these projects have been implemented has been 260 renminbi (US$31.40) higher than in areas where these measures were not pursued.
To continue strengthening the country's agricultural sector, the Ministry of Finance reportedly will adjust its relevant investment policies, optimize the investment structure and adopt policies recognizing regional differences, the news agency reported.
The specific policies include increasing the ratio of free investment from central government funds and reducing the ratio of paid investment, adjusting properly the local funds allocation ratio according to various regions' differences in prosperity, and adjusting properly the investment ratio for different regions while largely maintaining the investment ratio in land-harnessing projects and diversified business operation projects.
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