Agriculture Reference
In-Depth Information
That there exists genuine concern for food self-sufficiency in China is
understandable. Widespread famines have been experienced, although, in
hindsight, these have probably been due more to bad policies than to bad
weather. Concern about the possblty of food trade embargoes can also be
understood—although, again, experience has shown that trade embargoes
are difficult to implement (Lu 1997; Yang 2000). The difficulty of financing
large volumes of food mports would also have been a legtmate concern n
the past; however, this is no longer the case. In 2000, China's total export
revenue was about US$250 bllon. The mportaton of 22 mllon tonnes of
grain (the WTO import quota commitment) would cost US$3-4 billion—only
a small fracton of total export earnngs.
Food self-sufficiency is not, however, the same as food security. Food
security is a matter of whether households have sufficient income to
mantan an adequate det. The mportant queston wth respect to food
self-sufficiency for China is the extent to which it is prepared to rely on the
nternatonal market for the gap between ts domestc producton and ts
effective demand. China is such a large country that, inevitably, most of
the goods and servces consumed have to be produced domestcally.
To llustrate the economc costs of adoptng polces that am to
maintain grain self-sufficiency near the present level or to increase it,
protectionist scenarios were modelled by Duncan et al. (see Chapter 8)
using an adaptation of the GTAP model,
1
a global, multi-region, multi-
product general equilibrium model. Following Yang and Tyers (2000),
independent representations of governments' fiscal regimes were added
to the standard GTAP base, including direct and indirect taxation, separate
assets n each regon (currency and bonds) and monetary polces wth a
range of alternatve targets.
In earlier analysis, Yang and Tyers (1989) used a global agricultural
sector model to examne the mpact of rapd ncome growth n Chna on the
composton of food consumpton and the mplcatons of ths for food self-
sufficiency. They found that the anticipated redistribution of consumption
towards lvestock products would rase mport demand for feed grans and
that this would make the maintenance of self-sufficiency through protection
very costly. Because their analysis was restricted to the agricultural sector,
however, they could not examine the redistribution and economy-wide
