Chinese cultivation

Review– China in the Global Economy: Agricultural Policies in China after WTO Accession
OECD Observer

Two decades of agricultural reform have reduced poverty in rural China and incomes are still rising–last year, with an estimated upswing of 4.2%. But city dwellers are moving ahead much faster than their country cousins. In 1985, rural incomes were 54% of the level of their urban counterparts: today, they are less than one-third. The accession of China to the WTO and its integration into the global trading system will introduce further pressures on the farm market.

The question is, how can China make the additional agricultural reforms needed to open its markets while protecting the livelihoods of its farmers? This report, a compilation of presentations from an OECD meeting in May 2002, provides at least some answers.

One of China's major messages to OECD countries is that China has made considerable concessions in joining the WTO, and it now expects OECD members to provide access to their markets. China's agro-food trade performance has deteriorated recently, and one of the reasons cited has been the technical barriers to trade and high levels of protection by OECD member countries.

China in the Global Economy: Agricultural Policies in China after WTO Accession provides an array of possible measures to help rural populations adapt to new conditions. These include fiscal reform to alleviate disproportionately high taxes and fees imposed on farmers by local authorities; a relaxation of labour migration restrictions; better access to education to provide the rural population with the skills needed to compete on urban labour markets; and greater access to social benefits.

Other suggestions include investment in rural infrastructure, such as roads and water, as well as giving land to more efficient farmers. Credit for rural enterprises and better poverty alleviation measures are also urged.

©OECD Observer No 234, October 2002

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