Agriculture Reference
In-Depth Information
Producton adjustment costs have obvous mplcatons for rural ncome.
Although t may be reasonably beleved that the resources released by
reduction of production will be used more efficiently in other activities in
the long run, in the short run farmers may not be able to find other profitable
activities to employ the released resources, including their own labour. As
a result, farmers' income may be negatively affected. This issue has been
extensively analysed within the framework of simulation models (Huang 2000;
Tan 1999; L et al. 2000). On the bass of smulaton of the above-mentoned
CAPSiM model, bulk agricultural products such as grain, cotton, oil-bearing
products and sugar products wll declne by 2.5 per cent to 7.7 per cent. As
a result, farmer income will be reduced by the amount equivalent to the
total income of 3 million labourers in recent years (Huang 2000). It should
be borne in mind, however, that the degree of accuracy of the estimated
results depends upon the assumptions of the model, the interaction of various
economic variables, and the reliability of the statistical data and the estimated
parameters. The projectons nevertheless hghlght the mportance of the
short-term ncome effects of WTO accesson for farmers. As ncome nequalty
between the rural and urban populaton has become a crucal ssue for the
overall economic and social development of China, the potential adverse
ncome effects for the rural populaton deserve specal attenton.
Food security and WTO accession
In the debate over the effects of China's WTO accession, the impact on China's
long-term food securty has been frequently rased. There are concerns that
WTO accession will place China's long-term food security at risk. For a huge
country like China, food security has been and will continue to be a very
mportant objectve. There are no doubts whatsoever of the mportance and
legitimacy of the food security objective per se. However the assertion that
agrcultural lberalsaton wll harm food securty s questonable.
Concerns about the detrmental mpact of Chna's WTO accesson on
ts food securty are manly based upon the possble surge n gran mports
as a result of the mplementaton of the tarff quota system. Although the
imports of grain into China may increase after China's entry into the WTO,
they are unlkely to harm Chna's food securty. We approach the ssue from
the followng four perspectves.
