Agriculture Reference
In-Depth Information
Yang and Chen find that all member countries will gain from the ACFTA:
it will increase social welfare and promote real GDP growth in the EHP
phase of 2004-06 and in the full implementation during 2006-10. As the
EHP includes only a small package of agricultural commodities, the gains
in the second stage of the full implementation of the ACFTA will be much
larger n all member countres.
There is a large trade creation effect among ACFTA members; total
exports of ACFTA members will increase. A trade diversion effect is,
however, also apparent. Trade between ACFTA members and other regions
can be expected to decline due to the creation of the ACFTA. Because the
trade creation effect is much larger than the trade diversion effect, global
trade will be increased by the ACFTA, especially in the second stage of its
full mplementaton.
The ACFTA will bring about substantial structural changes in China and
n ASEAN countres. Trade lberalsaton wll mprove the explotaton of
comparative advantages in ACFTA member states. The structural changes
wll take place n agrcultural and ndustral sectors. The results also show
that the dfferent polcy arrangements stemmng from the two-stage trade
lberalsaton wll have dfferent mpacts on the shfts n economc structure
durng the process of mplementaton.
The rest of the world wll have to face the challenges brought about by the
creation of the ACFTA. Because the ACFTA will enhance the competitiveness
of China and ASEAN in each other's markets, exports of non-member countries
wll be substtuted. Socal welfare and real GDP wll declne n the non-
member countries as a result of the creation of the ACFTA.
Summary and discussion
Across the wide range of analysis carried out in this project, it is shown
consstently that the trade reforms Chna adopted n order to accede to
the WTO wll mean substantal structural changes wthn the agrcultural
sector. Looked at from a partial equilibrium agricultural perspective, the
reforms can be seen to result n substantal negatve mpacts across the
sector and a worsenng of food securty n the sense of reduced access to
income. It cannot be stated too strongly, however, that the outcomes of the
reform have to be analysed from an economy-wide perspective. In China, as
