Agriculture Reference
In-Depth Information
the comparatve advantage n agrculture tends to declne more rapdly
(Anderson 1990). Undoubtedly, the changes in China's RCAs for agriculture
durng the perod 1992 to 2005 have manly been the result of the fast
economc growth and the resultng dramatc structural changes. These
structural changes appear to have become even more rapd followng entry
nto the WTO and the removal of agrcultural protecton.
Economc factors
Since entry into the WTO in 2001, China's economy has been growing at
a rapid average annual growth rate of around 9.8 per cent. This rapid
economic growth has led to changes in the structure of the economy, with
the growth of manufacturng and servces sectors much faster than the
growth of the agrcultural sector. The share of agrcultural GDP n total GDP
has declined from 15 per cent in 2001 to 13.8 per cent in 2004 (calculated
from varous ssues of the SSB).
The structure of the agrcultural economy has also been changng.
Although the farming sector remains the most important agricultural sector,
ts share has declned from 55.2 per cent n 2001 to 50 per cent n 2004.
However, the animal husbandry and fishery sectors have been growing
rapdly and the share of these sectors has ncreased from 41.2 per cent n
2001 to 46 per cent n 2004 (calculated from varous ssues of SSB).
With the rapid economic growth, especially after China's entry into the
WTO, it is likely that the comparative advantage of China's agricultural
sector has been declining, and in particular that the comparative advantage
of Chna's farmng sector has been declnng. Ths changng pattern of
comparatve advantage s consstent wth Chna's resource endowments.
It s also an ndcaton of the mprovement n resource allocaton among
Chna's economc sectors.
Chna's remarkable ndustral growth has also played a large part n
driving up agricultural imports. Over 30 per cent of the growth in China's
agrcultural mports n 2004 came from raw materals used n producton
of non food manufactured products: such as cotton, wool, animal hides,
and rubber. In particular, growing textile production is generating demand
for cotton and wool that s beyond Chna's producton capacty. Chna's
