Agriculture Reference
In-Depth Information
increased sharply from US$77.7 million in 2003 to US$165 million in 2004,
whle ts mports of vegetables from Thaland ncreased from US$141.4
million in 2003 to US$249.5 million in 2004.
Changes in the pattern of China's agricultural trade after WTO
accession
Despite the recent rapid increases in absolute values of agricultural trade,
its importance in China's total trade has been declining. As shown in Figure
11.4, the share of agricultural trade in China's total trade declined from 10
per cent in 1992 to 5.8 per cent in 2001. After China's entry into the WTO,
ths declne has become even more pronounced. The share of agrcultural
trade was only 4 per cent in 2005, and the share of agricultural exports
in China's total exports declined even faster—from 7 per cent in 2001 to
3.5 per cent in 2005.
According to international trade theory, a country's pattern of trade
with the rest of the world is determined by its comparative advantage, and
ts comparatve advantage s determned by ts resource endowments. In
the case of China, the characteristics of China's resource endowments with
respect to agrcultural producton are that t s scarce n land resources but
abundant in labour. China's per capita arable land is 0.11 hectares, only 43 per
cent of the world average, and its per capita pasture land is 0.3 hectares, only
33 per cent of the world average. However, China has abundant labour—1.3
billion population—with nearly 70 per cent living in rural areas, and half of the
labour force is in the agricultural sector. Based on its resource endowments,
Chna should have a comparatve advantage n labour-ntensve agrculture
and a comparative disadvantage in land-intensive agriculture. Further, China
should have a bas towards exportng labour-ntensve agrcultural products
and mportng more land-ntensve agrcultural products.
Gven that the WTO accesson commtments should have led to Chna
producing and trading more in accord with its comparative advantage, an
nterestng queston s whether there has been any change n the pattern
of China's agricultural trade since its accession? To answer this question,
we compare Chna's agrcultural trade patterns for the two perods
1992-2001 and 2002-05, both by commodity group and by factor intensity
of producton.
