Embed Size (px)
Citation preview
Agricultural Trade Policies & Exporting Agricultural Goods to China
Report of the ATPC, FAO, OECD Conference and GIZ Regional Knowledge Exchange,
Beijing, 1-3 December 2019
1
Imprint
Published by the
Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH
Registered offices
Bonn and Eschborn, Germany
Friedrich-Ebert-Allee 32-36
D-53113 Bonn, Germany
T +49 228 4460-0
Dag-Hammarskjöld-Weg 1-5
D-65760 Eschborn, Germany
T +49 6196 79-0
I www.giz.de
Name of project
Support of Regional Economic Cooperation in Asia (SRECA)
Project Office
TaYuan Diplomatic Office
14 Liangmahe South Street, Chaoyang District
10600 Beijing, PR China
T +86-10-8532-1857
I [email protected] / www.giz.de/en/worldwide/34101.html
Author(s)/Compiled by
Huo Junyu, GIZ SRECA
Editor(s)
Florian Miß, GIZ SRECA
Photo credits
GIZ
Disclaimer
The views and opinions expressed herein are based on conference inputs and do not necessarily imply or reflect
the opinion of the organisation.
On behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ)
GIZ is responsible for the content of this publication.
Beijing, March 2020
2
Contents
1. Agenda ................................................................................................................................................................................ 6
2. Introduction ................................................................................................................................................................... 10
2.1 Background .................................................................................................................................................................. 10
2.2 Key Aspects of the Events ...................................................................................................................................... 11
3. The 2019 Agricultural Trade Policies Conference ......................................................................................... 12
3.1 Session I – Agricultural Markets Dynamics and their Implications for Food Security ................. 13
3.2 Session 2 – Agricultural Dimensions of Agricultural Policies ................................................................. 15
3.3 Session 3 – Innovation in the Agriculture and Food System ................................................................... 20
3.4 Session 4 – Rural Rivitalisation Via Agricultural Trade ............................................................................ 23
4. Regional Knowledge Exchange on Export Processes for Agricultural Goods to China ................... 27
4.1 Concepts of NTBs and the Contexts for trading with China .................................................................... 28
4.2 The Inspection and Quarantine Procedures for Imports to China ........................................................ 32
4.3 Matchmaking Opportunities ................................................................................................................................. 38
5. Recommendations and Way Forward ................................................................................................................. 39
6. Project “Support of Regional Economic Cooperation in Asia (SRECA)” ................................................ 40
3
List of tables
Table 1: China's Agricultural Product Imports Viewed by Regions ................................................. 32
Table 2: Fruit Imports by Main Categories in China (2018) ................................................................ 33
Table 3: Fruit Imports by Main Countries in China (2018) .................................................................. 34
Table 4: ATPC Expos............................................................................................................................................. 38
List of Figures
Figure 1: China's Import and Export Proportion in the World........................................................... 14
Figure 2: China's Import and Export Structure ......................................................................................... 14
Figure 3: Support to Agricultural Market in China .................................................................................. 17
Figure 4: Percentage of Gross Farm Receipts (2016-2018) ................................................................ 18
Figure 5: China's Budgetary Expenditure to Public Goods .................................................................. 18
Figure 6: Trade Barriers Employed by Countries .................................................................................... 19
Figure 7: Traceability Along the Supply Chain .......................................................................................... 21
Figure 8: Technical Design of China's AI Pig Farm .................................................................................. 22
Figure 9: Animal Identification ........................................................................................................................ 22
Figure 10: Concept of Rural Convergence ................................................................................................... 25
Figure 11: Income of the Business Entities with Roral Convergence .............................................. 26
Figure 12: World Merchandise Trade and GDP ........................................................................................ 28
Figure 13: Countries' Share of the World Import..................................................................................... 29
Figure 14: World Application of SPS ............................................................................................................. 30
Figure 15: World Application of TBT on Food Products ....................................................................... 30
Figure 16: Import-weighted tariffs and Ad Valorem Equivalents (AVEs) of NTMs imposed by
economies, by sub-region ........................................................................................................................ 31
Figure 17: Import-weighted tariffs and AVEs of NTMs, by sector .................................................... 31
Figure 18: Development of China's Fruit Product Imports .................................................................. 33
Figure 19: Fruit Imports by Main Categories in China (2018) ........................................................... 34
Figure 20: Fruit Imports by Main Countries in China (2018) ............................................................. 34
Figure 21: Development of China's Meat Product Imports .................................................................. 35
Figure 22: SPS Inspection and Market Entry of Meat & Fruits Products into China.................. 36
4
List of Abbreviations
ACFTA ................................................................................................................ ASEAN-China Free Trade Area
AMS .....................................................................................................................Agricultural Domestic Support
AQSIQ ........................................ Administration of Quality Supervision, Inspection and Quarantine
ASEAN .............................................................................................. Association of Southeast Asian Nations
ATPC ..................................................................................................... Agricultural Trade Promotion Centre
AVE .................................................................................................................................... Ad Valorem Equivalent
BMZ .................................................... Federal Ministry for Economic Cooperation and Development
CAGR ............................................................................................................... Compound Annual Growth Rate
CASS ............................................................................................ Chinese Academy of Agricultural Sciences
CFNA ................................................................................................................................................................................
..... China Chamber of Commerce of Import/Export of Foodstuffs, Native Produce and Animal
By Products
CIFIE .......................................................................................... China International Food Ingredients Expo
COFCO ............................................................ China National Cereals, Oils and Foodstuffs Corporation
EST ............................................................................................................ Trade and Markets Division of FAO
EU ..................................................................................................................................................... European Union
FAO ............................................................... Food and Agriculture Organization of the United Nations
GACC ..................................... General Administration of Customs of the People's Republic of China
GDP .................................................................................................................................. Gross Domestic Product
GIZ ............................................................... Deutsche Gesellschaft für Internationale Zusammenarbeit
GTI .................................................................................................................................. Greater Tumen Initiative
GVC ............................................................................................................................................. Global Value Chain
MARA ............................................................ Ministry of Agriculture of the People's Republic of China
NTM ...........................................................................................................................................Non Tariff Measure
OECD ...................................................The Organisation of Economic Cooperation and Development
OIE ...................................................................................................... World Organisation for Animal Health
R&D .............................................................................................................................. Research & Development
SME ...................................................................................................................... Small and Medium Enterprise
SPS ...................................................................................................... Sanitary and Phyto-Sanitary Measures
SRECA ....................................................................... Support of Regional Economic Cooperation in Asia
5
TMT ....................................................................................................................... Technical Measures to Trade
UN ......................................................................................................................................................United Nations
UNCTAD .......................................................... United Nations Conference on Trade and Development
UNESCAP .................... United Nations Economic and Social Commission for Asia and the Pacific
WTO .......................................................................................................................... World Trade Organization
List of Definitions
Ad Valorem Equivalent: A tariff that is not a percentage (e.g. USD per ton) can be estimated as a
percentage of the price (WTO, 2019)1
Compound Annual Growth Rate: The increase rate from which a value inclines over a specified
period of time (Conference Presentation, Huang Haiqian, CFNA, 2019)
Market Price Support: An indicator of the annual monetary value of gross transfers from
consumers and taxpayers to agricultural producers arising from policy measures creating a gap
between domestic producer prices and references prices of a specific agricultural commodity
measured at the farm-gate level (OECD, 2019)2
Producer Nominal Protection Coefficient: The percentage ratio between the domestic distorted
price and the counterfactual (undistorted) price; conventionally calculated as the ratio between the
domestic price and the world price (Scandizzo, 1989)3
Rate of Protection: The indicator measures the average percentage deviation of actual prices from
those that prevail without interventions (FAO, 2019)
Food Self-Sufficiency Rate: The proportion of the total domestic food supply in the total domestic
food consumption (Conference Presentation, Zhu Jing, Nanjing Agricultural University, 2019)
1 WTO, 2019, WTO Glossary, https://www.wto.org/english/thewto_e/glossary_e/glossary_e.htm 2 OECD, 2019, OECD Glossary, https://stats.oecd.org/glossary/search.asp 3 Scandizzo, P.L., 1989, Measures of protection: methodology, economic interpretation and policy relevance, FAO Economic and Social Development Paper 84, Rome.
6
1. Agenda
2019 Agricultural Trade Policies International Conference (1-2 December 2019)
1 December (Sunday)
9:00-12:00 Registration
14:30-15:30
Opening Session
Chair: Zhang Lubiao, Director General of ATPC
Opening statements:
• Zhang Taolin, Vice Minister of Ministry of Agriculture and Rural Affairs
• Kim Hong-Sang, President of Korea Rural Economic Institute
• Sun Tan, Vice President of Chinese Academy of Agricultural Sciences
• Frank van Tongeren, Head of Division, Smart Data and Modeling Division,
Trade and Agriculture Directorate, OECD
• Vincent Martin, FAO Representative in China and DPR Korea
15:30-16:30
Keynote Speech: Fan Shenggen, IFPRI
Vincent Martin, FAO
Frank van Tongeren, OECD
16:30-17:40 15th anniversary of the founding of Agricultural Trade Promotion Centre (ATPC)
2 December (Monday)
8:30-10:10
Session 1: Agricultural Market Dynamics and their Implications for Food
Security
Chair: Peng Tingjun, Department of International Cooperation, MARA
Presentations:
• Global Cotton Market Situation (Georgios Mermigkas, FAO)
• Agricultural Trade and Food Security in China (Professor Zhu Jing, Nanjing
Agricultural University)
• China’s Agricultural Import Pattern and Analysis on Import Diversification
(Dr. Yang Jing, ATPC)
• Medium-term Impacts of a Further Spread of African Swine Fever on
International Agricultural Markets (Mischa Tripoli, FAO)
Discussants (up to 10 minutes): Tian Weiming, China Agriculture University
Open discussion (30 minutes): all participants
7
10:10-10:25 Coffee/tea break
10:25-12:05
Session 2: International Dimensions of Agricultural Policies
Chair: Zhang Xiaowan, ATPC
Presentations (15 minutes each):
• Changing Landscape of Agricultural Policies (Florence Bossard and Silvia
Sorescu, OECD)
• Public Stockholding and Import Surges (Georgios Mermigkas, FAO)
• Research on the Forced Effect of Technical Measures to Trade on Chinese
Agricultural Exporters (Xie Zhongmin, ATPC)
• Zhejiang’s agri-products trade practice and research on development
countermeasures (Yuan Yijun, Zhejiang Provincial Department of Agriculture
and Rural Affairs)
Discussants (up to 10 minutes): Professor He Xiurong, China Agriculture
University
Open discussion (30 minutes): all participants
12:05-13:30 Lunch
13:30-15:25
Session 3: Innovation in the Agriculture and Food Systems
Chair: Georgios Mermigkas, FAO
Presentations:
• Application of Computer Vision and Phenotype Technology in Agriculture
(Sun Tan, Chinese Academy of Agricultural Sciences)
• Innovation in Food and Agriculture: Main Findings from Selected Country
Reviews (Shingo Kimura, OECD)
• Widen Agricultural Market through E-commerce (Luo Lin, International
Government Affairs of Alibaba Group)
• New Technologies in Tracking Animal Diseases and Residues (Mischa Tripoli,
FAO)
• Guolian Group Supply Chain Innovation (Zhao Hongmei, Guolian Aquatic
Products)
Discussants (up to 10 minutes): Silvia Sorescu, OECD
Open Discussion (30 minutes): all participants
15:25-15:40 Coffee/tea break
15:40-17:20
Session 4: Rural Revitalization - Country Experiences
Chair: Silvia Sorescu, OECD
Presentations (15 minutes each):
8
• Global Reflection on Rural Revitalisation (Chen Zhigang, Zhejiang University
and International Food Policy Research Institute)
• Experiences on Rural Development in Korea (Dr. Kim Yong Lyoul, Korea Rural
Economic Institute)
• China Rural Revitalization Strategy (Professor Cheng Guoqiang, Tongji
University)
• The Influence of Rural Revitalisation Strategy on Agricultural Trade (Zhang
Junping, ATPC)
Discussants (up to 10 minutes): Mischa Tripoli, FAO
Open discussion (30 minutes): all participants
17:20-18:00 Wrap up and Closing remarks
Regional Knowledge Exchange on Export Processes for Agricultural Goods to China (3
December 2019)
3 December 2019 (Tuesday)
8:30—8:40 Opening Remarks by ATPC & GIZ
Remarks by:
• Mr. Florian Miß, Project Director of SRECA, GIZ
• Mr. Zhang Lubiao. Director General of the Agricultural Trade Promotion
Center (ATPC), Ministry of Agriculture and Rural Affairs
8:45—9:25 Session 1: Agricultural Trade, Markets Dynamics and Non-Tariff Measures
(NTMs)
• Current trends in the global agricultural trade
• Non-tariff barriers in agricultural trade
• OECD-FAO Outlook for the global agricultural trade (2019-2028)
Speaker: Mr Georgios Mermigkas, Economist of Trade and Markets Division
(EST), FAO
9:25—10:05 Session 2: Introducing and evaluating the reform of the supervisory and
registration system in the Bureau of Import and Export Food Safety, General
Administration of China Customs
• The process of importing agricultural products to China
• Necessary certifications
• Procedure of agricultural products inspection
• Packaging and transport processes
Speaker: Mr. Kong Xiaobang, Director of the Bureau of Import and Export Food
Safety, General Administration of Customs of the People's Republic of China
10:05—10:20 Group Photo & Coffee Break
10:20—11:00 Session 4: China Imports and Exports of Agricultural Products
9
• Introducing the China Chamber of Commerce of Import/Export of
Foodstuffs, Native Produce and Animal By Products (CFNA)
• Introducing imported food market in China
Speaker: Mr. Huang Haiqian, Director of the Meat and Seafood Department, China
Chamber of Commerce of Import/Export of Foodstuffs, Native Produce and
Animal By-products (CFNA)
11:00—11:40 Session 3: Chinese businesses’ demand and requirement in importing food
products
• Introducing China National Cereals, Oils and Foodstuffs Corporation
(COFCO) with a short video display
• Introducing COFCO’s ecommerce portal: womai.com
• Introducing COFCO Food Import Co., Ltd (the main countries of origin for
COFCO’s imported goods, the requirements and demands on importing
food products to China)
Speaker: Ms. Iris Lee, Deputy General Manager of the Import Food Division,
COFCO Food Import Co., Ltd
11:40—12:10 Session 5: The Agricultural Trade Promotion Centre (ATPC) and its
international cooperation projects
• ATPC’s international cooperation projects
• Introducing China Fisheries & Seafood Expo and China International
Aquaculture Exhibition
• Introducing China Potato Expo
• Introducing China International Food Ingredients Expo
Speaker: Ms. Zhang Xuechun, Deputy Division Director of the Exhibition Division,
ATPC; Mr. Wang Xiusong, Division Director of the Liaison and Cooperation
Division, ATPC and Mr. Lyu Xuan Han, Assistant Researcher of the Liaison and
Cooperation Division, ATPC; Ms. Yuan Tong, Division Director of the Trade
Promotion Division, ATPC
12:30—13:30 Joint Matchmaking Lunch of the speakers & participants
10
2. Introduction
The Support of Regional Economic Cooperation in Asia (SRECA) Project invited 20 trade policy
makers and practitioners from its partner instituions in Cambodia, Lao PDR, Vietnam and Mongolia
to attend the 2019 Agricultural Trade Policies Conference on Agricultural Trade and Rural
Revitalisation organised by the Agricultural Trade Promotion Centre (ATPC) of the Ministry of
Agriculture and Rural Affairs, China, OECD, and FAO from 1 to 2 December 2019 in Beijing, China.
Furthermore, the delegates actively participated in the Regional Knowledge Exchange on Export
Processes for Agricultural Goods to China jointly organised by GIZ SRECA and ATPC on 3 December
2019 in Beijing to gain insights on China’s agricultural product importing requirements and the
demand of the Chinese agri-food market.
2.1 Background
On behalf of the Federal Ministry for Economic Cooperation and Development (BMZ), the Deutsche
Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH is implementing the project “Support of
Regional Economic Cooperation in Asia (SRECA)”. To involve countries to reap the full potential of
Asian regional integration, SRECA focuses on improving agricultural trade services in its four focus
countries Cambodia, Lao PDR, Vietnam and Mongolia. Via regional and triangular cooperation with
China, one of the biggest global markets for agricultural goods in the region, SRECA aims to establish
platforms for export-oriented SMEs in the focus countries to gain first-hand knowledge and
opportunities of market entry to China. With 15 years devotion in developing Chinese agricultural
11
trade and outreach, ATPC partners with SRECA to strengthen capacity in China’s neighbouring
countries on policy reforms of the global as well as regional trade and China’s agri-food regime.
While celebrating the 15th Year Anniversary of ATPC, the 2019 Agricultural Trade Policies Conference
on Agricultural Trade and Rural Revitalisation was organised, focusing mainly on the resilience and
trade sustainability of the global agri-food market. The Regional Knowledge Exchange on Export
Processes for Agricultural Goods to China on the other hand, aimed to delve into the practical
procedure for the focus countries to export agri-food products to China. The following pages
summarise the key contents and outcomes of the event. Detailed information including global,
regional and country-wide market analysis, policy suggestions, technological practices and country
exporting guidelines can be retrieved from the respective summaries from the following pages.
2.2 Key Aspects of the Events
The 2019 Agricultural Trade Policies Conference on Agricultural Trade and Rural Revitalisation
1) To explore the dynamics of agricultural markets and their implications for food security
within the framework of an interconnected global economy.
2) To explore the synergies and trade-offs of different policy approaches aimed at creating a
more productive, sustainable and resilience agri-food system.
3) To gather specific country and regional experiences, with a view to focusing on future
agricultural policy solutions for China and the world.
The Regional Knowledge Exchange on Export Processes for Agricultural Goods to China
1) To share upfront knowledge on China’s market demand and SPS procedures on agricultural
products to decision makers in the agricultural trade sphere of the focus countries.
2) To serve as a pilot triangular project testing out the impacts of organising regional knowledge
exchange workshop in the designed manner and collect feedbacks for future practices.
12
3. The 2019 Agricultural Trade Policies Conference
The conference was opened up by setting forward key concepts of developing a sustainable and
resilient agricultural economy where trades take place on a level playing field minimising distorted
competitions, to enable countries with the capacity to ensure food security, sufficient food provision
and ecological prosperity. Estimations show an annual average of 700 billion USD issued to support
the agricultural sector4. One main challenge is to support investments towards the development of a
more environmental friendly, efficient, transparent and socially empowering agricultural sector for
rural revitalisation.
Four thematic sessions on 1-2 December explored policy and innovative solutions that can respond
to ongoing issues in the global agricultural sector. After an introductory analysis of the international
agri-food market an evaluation towards the key explorations in agri-food sector policies and
innovative technologies followed. The conference was closed with a session reviewing global efforts
to revitalise rural regions and showing implications on the agri-food trade sector.
In particular response to trade regimes in Cambodia, Lao PDR, Vietnam and Mongolia, and to
especially address the needs of small scaled farmers and export-oriented SMEs in the four countries,
the report summarises the following deliverables from the thematic sessions.
4 OECD, 2019, Producer and Consumer Support Estimates, OECD Agriculture statistics (database),
http://dx.doi.org/10.1787/agr-pcse-data-en , last accessed on [03/02/2020]
Agricultural Markets Dynamics Agricultural Policies
Agricultural Innovation Rural Revitalisation
13
3.1 Session I – Agricultural Markets Dynamics and their Implications for Food Security
The globalised world trade makes the dynamics of agri-food markets across countries and across
sectors more intertwined than ever. The FAO economists, Georgios Mermigkas and Mischa Tripoli
from the Trade and Markets Division probed into, first, the sustainability within the cotton value
chain, leading to resilience both in the cotton trade cycle and in resource preservation. Second, how
food insecurity in one country can influence the global agri-food market on multifaceted levels. The
professor from Nanjing Agricultural University, Zhu Jing, and the Deputy Division Director of ATPC,
Yang Jing introduced the Chinese agri-food market dynamics to date. Main outcomes drew the
following picture:
Analysis of the Current Dynamics of the Chinese Market
China opened up its market from the 1978 Reform and Opening up. Further opening up of the Chinese
market took place since China’s accession to the WTO. Partaking actively in the global agricultural
trade arena, China has transformed from a net exporter to the world’s second largest Importer of
agro-products (2017) as well as the 4th largest exporter of agro-products in the world (2016) as
shown in Figure 1.
World Trade - Food Security
- Inelastic food product insecruity in one country can leverage to a regional and global supply gap
of the product
- Volatility in the global market means both price upflows and opportunities for alternative products
Chinese Market - Food Security and Trade Dynamics
- China ranked 45th among 113 countries in the 2017 Global Food Secuity Index
- China mainly imports land-intensive products and exports labour-intensive products
- Imports become an increasingly important supplement to China’s food market since the WTO
accession
World Trade - Sustainability in the Trade Cycle
- At the late maturity stage of a product, the market power is on the retail side, consolidation
often takes place
- Technology for sustainable production can save on resources and lower the cost
Chinese Market – Diversifying Food Consumption
- China is the second biggest agro-product importer
- Chinese consumers are open to diversified choices of agro-products
Market Dynamics
14
Figure 1: China's Import and Export Proportion in the World
Source: Conference Presentation (Yang Jing, ATPC, 2019)
Having 9% of the world cultivated land and counting around 20% of the world population, China
mostly imports land-intensive products and exports labour-intensive products as shown in Figure 2:
Figure 2: China's Import and Export Structure
Source: Conference Presentation (Zhu Jing, Nanjing Agricultural University, 2019)
With the urbanisation and rising income levels in China, the diet patterns in China are still
transforming to a higher diversification pattern. Chinese consumers are open to a greater variety of
quality agri-food products. This means opportunities for Mongolia’s meat exports and for Cambodia,
Lao PDR and Vietnam to export their specialty fruit products. In addition to the positive future
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
export import
15
trajectory, China ranks currently the 4th largest importer of beef products and 5th largest importer of
fruit products.
Suggested Market Research Strategies for Countries Prior to Exporting
Researching the level of self-sufficiency rate of the product within a market is crucial before a country
export the relevant product to the country.
Countries are suggested to leverage the impacts of regional/global trade agreements, initiatives and
WTO regulations aiming for freer and more transparent trade within national trade startegies.
Suggested Market Contingency Plan for Food Insecurity Outbursts in the Global Market
In the interconnected global market, countries are suggested to set up contingency analysis of the
potential food insecurity outbursts in their home countries and their trading partners. This is to first
foresee the transformation of demand-supply patterns of a product itself and related products on a
long term spectrum; second, to plan for alternative imports/exports; and third, to come up with
measures reviving this product market alongside of the country’s steps resolving the food insecurity
problem.
3.2 Session 2 – Agricultural Dimensions of Agricultural Policies
Agricultural policies both within countries and imposed on trade between countries yield significant
impacts on the producers and the retailers of the agri-food sector. In this session, economists
Florence Bossard and Silvia Sorescu from OECD probed into the domestic agricultural support
policies in China, in comparison to other nations. The experts suggested governments to input more
capacity and funding towards the public services in the agri-food sector, it was also mentioned that
countries need to carefully select the public stockholding release time. “While the WTO’s Agreement
on Agriculture sets no limit on how much food governments can buy at market prices as part of their
public food stockholding schemes, nor on domestic food aid to poor citizens, it does require
purchases made at administered prices under these programmes to count towards the country’s
overall ceiling on trade-distorting support. The challenge now for WTO members is to construct an
equitable and sustainable solution to the problems that countries have raised: one that takes into
account food security objectives, and which is based on concrete evidence about the operation of
public stockholding programmes, and the extent to which they might affect the functioning of global
markets.5” The economist from FAO, Georgios Mermigkas also explained the volumn surge and the
implied price depression in the domestic market when import surge takes place. In another session
input, Xie Zhongmin from ATPC found that while tariffs impose definite financial pressures on the
traders, technical measures to trade (TMTs) has “forced” Chinese enterprises to bolster their
technological capacities and product standards. By taking a province-specific lens, the Division
5 ICTSD, 2016, Public Stockholding for Food Security Purposes: Options for a Permanent Solution, https://www.ictsd.org/sites/default/files/research/public_stockholding_for_food_security_purposes_options_for_a_permanent_solution.pdf , last accessed on [20/02/2020]
16
Director from Zhejiang Provincial Department of Agriculture and Rural Affairs introduced Zhejiang
Province’s policies supporting agricultural trade with timely trade monitoring system, e-commerce
and efficient transportation facilities. Main outcomes drew the following picture:
Reviewing China’s agricultural support policies & Implications for other economies
China’s support policies for its agricultural producers takes the main form of market price support
(MPS). Budgetary transfers to support general services to producers (collectively or individually)
have become more prevalently adopted by the Chinese government. However, on the aggregate level,
it still is less important than market price support as shown in Figure 3.
Due to market price support in China, producers receive prices higher than those common on world
markets. This is mainly due to domestic policies like minimum purchase prices and further trade
policies like trariff rate quotas (TRQ) or state trading. The level of support varies and is diversified
across commodities. Sugar, rapeseed, wheat, rice are strongly supported through prices, followed by
livestock and imported fruit and vegetables. Soybeans and maize are supported by direct payments.
Apples, peanuts, eggs, and exported fruit and vegetables are not supported in that regard. Of course
these market price supports come with an impact. It does put an implicit tax on consumers through
agricultural price policies and generates signals to producers that deviate from market signals. This
distorts both, production and trade by reducing the allocative efficiency of resources (Conference
Presentation, Florence Bossard and Silvia Sorescu, OECD, 2019).
Due to the market price support in China, when analysing product price levels in China, trading
partners are suggested to take into account the government interventions.
Monitoring and Evaluating Agricultural Policies
- Despite the increasing budgetary transfers, market price support remains the key agricultural
support policy in China
- Governments are encouraged to invest more in the public goods in agriculture
TMTs “forcing” Chinese Exporters to Enhance Technology
- TMTs forced exporters to increase their R&D input, which in turn promoted an increase in
exporters' TFP.
- Among the five different types of TMTs for agricultural products, the maximum residue limits
has the most significant “forced effects”
Public Stockholding and Import Surges
- Many countries continue to rely on public stockholding to achieve producer & consumer oriented policy objectives,
therefore, paying attention to the stock release means and timing is suggested to reduce distorting effect
- Import surges can occur due to a country’s increased per capita consumption, or domestic changes in trade policies,
climate and other spheres; it does not necessary occur due to trading partners’ trade policies
Agricultural practices in Zhejiang, China
- Emergency policies play fundamental roles in Zhejiang's agricultural trade market
Infrastructual development support efficient logistics of products
- Corss border e-commerce diversifies both import and export products
Agricultural Policies
17
Figure 3: Support to Agricultural Market in China
Source: Conference Presentation (Florence Bossard and Silvia Sorescu, OECD, 2019)
China’s budgetary transfers have increased consistently. Proportionately, 40% of the transfers goes
to Input Subsidies, 48% goes to Direct Payments and 12% goes to Agri-environmental payments &
Agricultural development projects in poor regions. Direct payments have been suggested one efficient
means of support for the producers. In addition, to respond to the many environmental and
livelihood issues, investment in the agri-environment and agricultural development support is
encouraged. The % Producer Support Estimate (PSE) indicates the extent to which agricultural
policies modify farmers revenue. In China’s perspective, 15.3% of gross farm revenue comes from
domestic and trade policies enacted in 2016 to 2018 (Conference Presentation, Florence Bossard and
Silvia Sorescu, OECD, 2019).
Countries undertake varied ways to support their agricultural sector, a rebalanced agricultural
support portfolio is encouraged for all countries. In comparison to other nations, China’s MPS is quite
positive but the share of most distorting support remains important as shown in Figure 4. Under the
WTO Agricultural Agreement the main conceptual consideration is still that there are basically two
categories of domestic support — support with no, or minimal, distortive effect on trade on the one
hand (green box) and trade-distorting support on the other hand (amber box). Governments
providing agricultural research or training is considered to be non or minimal disortive, whereas
market price support would be more disortive.6
6 WTO, 2020, Domestic Support, Agricultural Agreement https://www.wto.org/english/tratop_e/agric_e/ag_intro03_domestic_e.htm , last accessed on [20/02/2020]
18
Figure 4: Percentage of Gross Farm Receipts (2016-2018)
Source: Conference Presentation (Florence Bossard and Silvia Sorescu – OECD Database, 2019)
China also commits part of its budgetary support to the national agro-product stockholding, sectoral
innovation, infrastructure, marketing and other public services (Figure 5).
Figure 5: China's Budgetary Expenditure to Public Goods
Source: Conference Presentation (Florence Bossard and Silvia Sorescu – OECD Database, 2019)
-50
0
50
100
150
200
250
300
Transfers, USD billion
Market transfers to producers Budgetary transfers to producers Public good expenditures Consumers subsidies
19
However, China’s expenditure to public goods remains low compared to producer support. Countries
are encouraged to distribute more support in this sector to sustainably empower their agricultural
sector. In the digital era, countries are especially suggested to invest in their Research and
Development vitality, ensuring e-connectivity and therefore entail reforms in the agricultural
production empowered by Information Technology.
The Positive Impacts of technical measures to trade (TMTs)
Tariffs and Non-Tariff Barriers (NTBs) are two common trade barriers countries face. Throughtout
years, the global tariff levels have been declining, whereas NTBs like TMTs – among others sanitary
and phytosanitary measures (SPS) – are rising (Figure 6).
Figure 6: Trade Barriers Employed by Countries
Source: Conference Presentation (Xie Zhongmin, ATPC, 2019)
TMTs imply consumers’ demand for quality and safe products, indicating improved standards of
living across the globe7 . To comply with the technical requirements imposed by TMTs, trading
enterprises require the technological capacities to upgrade their product in terms of quality,
packaging, hygenic and safety levels in order to fulfil or even surpass the TMT requirements.
7 WTO, 2020, Technical Information on Technical barriers to trade,
https://www.wto.org/english/tratop_e/tbt_e/tbt_info_e.htm , last accessed on [04/02/2020]
20
Data shows that Chinese agricultural exporters improve their reasearch and development (R&D)
when conforming to their trading partners’ TMTs. A regression analysis showed a “forced effect” on
the technical capacity of Chinese agricultural enterprises due to TMT requirements of foreign
markets. Out of the all TMTs for agricultural products, the maximum residue limites yields the most
signicicant improvedment in Chinese enterprises’ technological development. In addition, TMTs
from the U.S., Japan, and the EU have had the largest capacitating impact on the Chinese agricultural
exporters (Conference Presentation, Xie Zhongmin, ATPC, 2019).
TMTs therefore, when defined fairly and transparently, can be set up by countries and enterprises as
targets of technological advancement. Technical improvement “forced” by TMTs can also leverage
the achievement of varied sustainable goals in the human society.
3.3 Session 3 – Innovation in the Agriculture and Food System
Technological innovation drives long term development in the agri-food sector. Former OECD
agricultural policy analyst Shingo Kimura first evaluatesd how knowledge production and knowledge
transfer can be made more responsive through enabling policies. Then FAO introduced animal
traceability systems as a digital solution that supports the surveillance, data analysis and certification
along the food production chain. The Vice President from the Chinese Academy of Agricultural
Sciences (CASS), Sun Tan and Zhao Hongmei, the Deputy General Manager from the Chinese
enterprise - Zhanjiang Guolian Aquatic Products took a focus in China’s R&D and application of
traceability technology in the meat, fruit and seafood markets. Main outcomes drew the following
picture:
How innovation can be supported by policies
- Innovation needs enabling environment across sector, therefore supporting policies should not be
sector-specific
- Supply and demand side policies should co-play to address areas need technological support
- Environmental concerns should be mainstreams in all innovation policies
Animal Traceability & its Implications
- Animal Traceability can support on the surveillance, data analysis and certification along
the production chain
- Animal Traceability especially provides solutions for food security control
China's R&D in Traceability
- Traceability via technology along the GVC enables e-connectivity and helps producers perceive market opportunities in advance
- Both the meat and fruit product production & retailing can benefit from traceability
Traceability in the Seafood Market
- Traceability entails quality in the production and management in China's seafood chain
- China's upper middle class rises in population, demand in seafood rises
Innovation in Agri-Food Sector
21
Suggested directions of policy reform for innovation in the agri-food sector
One key challenge for governments is to make the agricultural innovation system more responsive
to needs and more effective in generating innovative solutions. This requires efforts beyond making
R&D policies specifically for the agri-food sectors, since the cross-sectoral policy and market
environment matters for innovation. Policiymakers need to support the agricultural sector to become
more integrated with other sectors. Traditionally, agriculture has been treated differently from other
parts of the economy but consumers’ preference, international and regional initiatives, connectivity
between countries now have a much greater impact on agricultural production. Therefore,
encouraging research efforts analysing other sectors’ influence on agri-food economy, and
supporting agricultural producers to gain a more rounded understanding of the economic sector can
help them innovate towards more sustainablity. Policies should less focus on commodity specific
support but enhance the producers role in business and risk management. Therby, open up for
enhanced input from the private sector and service providers into policy making.
China is currently one of the largerst investor into public agriculture R&D system with one of the
largest decentralised networks in that regard. One issue that might be faced here, is that is sometimes
more difficult for public R&D institutions thasn private ones to commercialise their inovations.
Engaging producers more into public innovation processes and agendas, like co-funding for
agricultural R&D schemes with relevant private sector associations could avoid mismatch of skill
supply.
Innovation facilitating more environmentally friendly agricultural production and retailing is also
suggested for countries to devote more research efforts in. With the agricultural sector performing
aligning a green code of conduct, countries are more likely to achieve their environmental sustainable
targets (Conference Presentation, Shingo Kimura, OECD, 2019).
Traceability in the Agri-food Sector
Traceability is a system through which agri-food products can be traced from the production field to
their consumption. Traceability is made possible through varied digital solutions including
blockchain, big data, Internet of Things sensors, motion sensors and Artificial Intelligence as shown
in Figure 7.
Figure 7: Traceability Along the Supply Chain
Source: Conference Presentation (Mischa Tripoli – adopted from TE-Food by FAO,2019)
22
Some producers in China have adopted artificial intelligence (AI) Pig Farming technology (Figure 8)
to store real time data about the health level, drinking, exercising and eating habits of their pigs.
Animal identification (Figure 9) through AI is also actualised to detect individual illness and
productivity. The data accessible in the traceability system has also made the detection of early signs
of animal disease possible, preventing potential animal disease outbreaks.
Figure 8: Technical Design of China's AI Pig Farm
Source: Conference Presentation (Developed by Chai Xiujuan and Sun Tan, Chinese Academy of Agricultural Sciences, 2019)
Figure 9: Animal Identification
Source: Conference Presentation (Mischa Tripoli, FAO, 2019)
23
Likewise in the fruits and vegetables sector, traceability along the production cycle can help farmers
make more informed decisions on the harvesting time. They can then make systematic comparisons
between their product’s harvesting time with that of other countries, to export effectively to fill in
the supply gap of the relative countries.
3.4 Session 4 – Rural Rivitalisation Via Agricultural Trade
Rural networks in the agri-food sector like, producers, retailers, and marketing entities from within
and outside of rural regions base their livelihoods on the agricultural prosperity. Hence, rural
revitalisation has become a fundamental step facilitating better living conditions for people in and
beyond the 44.7% world population residing in rural regions8. Moreover, rural revitalisation is seen
essential to eradicate absolute poverty across countries. In this session, Chen Zhigang, Dean of China
Academy for Rural Development in Zhejiang University analysed the concept and practices of rural
revitalisation across countries and proposed urban rural economies to be developed as a unity. From
an agri-food trade perspective, the Director from the National Development Research Centre of
Tongji University, Cheng Guoqiang, and Zhang Junping, the Division Director from ATPC presented
on China’s Rural Revitalisation Strategy. Kim Yonglyoul, the Research Director from Korea Rural
Economic Institute then introduced Korea’s innovative policy approach to support industries
combining agricultural production with manufacturing and services provision to enhance the income
level of rural communities. Main outcomes drew the following picture:
8 World Bank, 2019, Rural Population Percentage in World Populaton,
https://data.worldbank.org/indicator/SP.RUR.TOTL.ZS , last accessed on [08/02/2020]
Promoting Endogenous Rural Development via Policies
- Investment and policy focus on the infrastructure, environment protection, public
services and welfare of farmlands & producers can lead to sustainable agricultural prosperity
- Adopt a “Rurbanomic” Approach Build rural economy as an equal development partner for the
urban economy
Rural Convergence: Korea's modern approach to rural vitalisation
- Policy promotes convergence of industries to help rural communities prosper (6th Industry
Approach)
- Product Development and Joint Marketing for the converged industries are crucial
China's Domestic Agricultural Policies for Revitalisation
- China aims to revitalise rural areas fully by 2050
- For the essential goals of food security and social stability, China's Agricultural Support Indensity
has increased in the past four decades
Rural Vitalisation empowers agricultural trade
- Comprehensive capacity of grain production is a mandatory indicator for rural reviatlisation
- Education and R&D are two appraoches to capacitate the agri-food sector
Agri-food production and Rural Revitalisation
24
China’s Rural Revitalisation Strategy and its implication for agri-food trade
The gaps between both the per capita disponsible income and the per capita consumption of urban
and rural households have remained significant in China despite the downward trajectory especially
from the 21st century. To narrow the urban-rural disparity, Chinese government proposed a national
strategy of “Rural Revitalisation” in its National Congress in 2017, and later set a goal such that “by
2050, rural regions in China will be fully revitalised, the agricultural sector is strengthened, the
ecological legacy is preserved and rural households lead a prosperous life”9.
To strengthen the agricultural sector, Chinese government imposes a bottom-line principle to first
support small-scaled farmers to guarantee their basic livelihood; second, on a macro scale, to ensure
the sufficient and secure food supply through domestic agricultural industry and global agri-food
trade. Modernisation of agricultural practices has been promoted to be a crucial approach to
structurally transform China’s agricultural sector, while at the same time, education programmes are
facilitated in rural China preparing the rural settings with more skilled labours. The rapid reform in
China’s rural context foresees Chinese consumers’ demand towards higher quality agri-food supply
with guaranteed food security from both within China and beyond.
To bind with WTO’s Agriculture Agreement10, China has been restricting its agricultural support
policies that can distort the international market. In 2019, 87% of China’s domestic agricultural
support are WTO’s green box measures, which means measures with no or minimal distortive effect
on trade11. China’s modification in its agricultural support policies also interprets that, to maintain a
sustainable trading relationship with China, exporting countries are suggested to focus primarily on
the quality of the products they export to China.
Scrutinising China’s development paths, a dual Urban-Rural development structure has been
embedded in China’s policies and practices (Workshop Presentation, Chen Zhigang, Zhejiang
University, 2019). Urban and rural economies are considered two separate development entities so
far. From the macro level, China is suggested to build the rural economy as an equal partner with the
urban economy. This requires governments and private sectors from all levels to holistically review
how infrastructure, education, health and technological sectors in China can progress on a level
playing field for China’s urban and rural regions. And via policy nudged connectivities, bringing along
more business opportunities to the rural community. A concept of ‘Rurbanomic Approach’ has been
proposed to describe the integrated urban-rural economic development pathway (Chen, et al.,
2019)12.
9 The government of the Republic of China, 2018, The National Strategy of Rural Revitalisation, No. 1 Document on Rural
Affairs. 10 WTO 2019, WTO Agriculture Agreement, https://www.wto.org/english/docs_e/legal_e/final_e.htm , last accessed on [26/02/2020] 11 WTO 2019, Domestic Support in Agriculture,
https://www.wto.org/english/tratop_e/agric_e/ag_intro03_domestic_e.htm , last accessed on [10/02/2020] 12 Chen et al., 2019, Rurbanomic Approach, International Food Policy Research Institute.
25
Experiences in South Korea vitalising the rural communities
South Korea has seen signs of stagnated value added from around 2010 in the agricultural sector. To
stimulate income growth for South Korean households, the South Korean government spotted
opportunities in industries such as ‘farm-tourism’, ‘organic dining-out’, ‘processed farm produce’
which combine the primary, secondary and tertiary industries, yielding market opportunities along
the constantly modernising global economy. The convergence industry in rural areas are defined as
the 6th industry and has become a focus area in South Korea’s rural vitalisation policy.
Before 2015, the practices facilitating rural convergence remained in the policy level. From 2016
onwards, central government of South Korea together with the local governments connected efforts
with private agencies to support individual business entities by developing regional networks of
agriculture and other industries. By helping bridge business networks between enterprises at the
village, township, municipal and county levels, a clustered value chain is facilitated in a multi-layered
manner. To ensure the effective collaboration between the business entities across levels, a hub
standing independantly from the business activies is designated by the government (Figure 10).
Figure 10: Concept of Rural Convergence
Source: Conference Presentation (Kim Yonglyoul, Korean Rural Economic Institute (KREI), 2019 )
Efforts have seen improvemet in the sales and income levels of the business entities which partake
in the rural convergence industry. In 2015, proportionately, nearly all income increase in the
business entities with the 6th industry components came from their rural convergence practices
(Figure 11).
26
Figure 11: Income of the Business Entities with Roral Convergence
Source: Conference Presentation (Kim Yonglyoul, Korean Rural Economic Institute (KREI), 2019)
South Korea’s experience shows that, cooperative networks across industries and between urban
and rural contexts can enhance the competitiveness of all industries. To sustainably maintain the
impacts of the 6th industry in South Korea, it is suggested that there should be more inputs in the R&D
of product development and joint marketing for the rural convergence practices. In addition, the local
governments’ roles in supporting the multi-scale network remains crucial, especially in scenarios
where structural transformations needing support of skilled labour force. Government support
framework in the infrastructure, human resources aside, local governments are also expected to
respect the autonomies of the business entities, while identifying the private-led cooperative
partnerships, create an enabling environment for the proven workable collaborative mechanisms to
function in the long run.
27
4. Regional Knowledge Exchange on Export Processes for
Agricultural Goods to China
To serve as a platform for delegates from Cambodia, Lao PDR, Vietnam and Mongolia to gain first
hand information on entering into China’s agri-food market, the Regional Knowledge Exchange
Wrokshop was conducted for procedural information sharing and discussions with respective
Chinese actors. The half-day workshop was opened and moderated by Mr. Florian Miß, SRECA
Programme Director. He first welcomed the delegates, introduced the GIZ SRECA Programme and
outlined the objectives of the workshop. Mr. Zhang Lubiao, the Director General of ATPC also
delivered remarks to introduce ATPC’s mandate to promote agricultural trade through knowledge
sharing.
The workshop consists of the following three components:
First laying out the framework of Non-Tariff Barriers (NTBs) and the broader settings of trade in
Asia, Economists from FAO, introduced concepts and context of global agricultural trade and the
implications when NTBs are applied. Kong Xiaobang, Director of the Bureau of Import and Export
Food Safety, General Administration of Customs of the People's Republic of China (GACC), and
Huang Haiqian, Director of the Meat and Seafood Department, China Chamber of Commerce of
Import/Export of Foodstuffs, Native Produce and Animal By-products (CFNA) then introduced
the current process of inspection and quarantine for goods to be imported to China. They especially
advised in their presentations on how meat and fruit producers can register their entries to the
Chinese market. The procedural knowledge sharing was followed by China National Cereals, Oils
and Foodstuffs Corporation (COFCO), China’s largest food processing company opening up their
online and offline portals to establish more import collaborations between countries. The Deputy
General Manager of the Import Food Division, Iris Lee especially took a focus to introduce COFCO’s
Concepts and Contexts for Trading with China & NTBs
The Inspection and Quarantine Procedures
for Imports
Trade Matchmakingbetween countries
28
ecommerce platform. To further the business matchmaking potentials, ATPC introduced their three
product specialised exhibitions for delegating countries to partake and utilise the business
opportunities.
4.1 Concepts of NTBs and the Contexts for trading with China
Agricultural trade increased more than three-fold since 2000 with an average annual growth rate of
more than 6% (Figure 12). The key driving force behind is the economic growth supported by
population increase and advancement in transport and technologies. The interconnectivity across
countries in addition, eased market access to global trade.
Figure 12: World Merchandise Trade and GDP
Source: Workshop Presentation (Georgios Mermigkas, FAO, 2019)
China as an emerging economy, has its share of the world import increased from 2.3% in 2000 to
8.2% in 2016 (Figure 13).
29
Figure 13: Countries' Share of the World Import
Source: Workshop Presentation (Georgios Mermigkas, FAO, 2019)
As international trade evolves, the application of the conventional market entry barrier – tariffs
declined. Governments instead apply more NTBs to address their domestic public concerns, and in
particular in the agri-food markets to protect human, animal and plant health as well as to regulate
the technical characteristics of products (i.e. labelling, traceability of materials and quality
standards). Staticstics show that the two dominant measures of NTBs are SPS and TBTs which are
more or less on a constant rise since 1995 (Figure 14 and 15).
30
Figure 14: World Application of SPS
Source: Workshop Presentation (Georgios Mermigkas, FAO, 2019)
Figure 15: World Application of TBT on Food Products
Source: Workshop Presentation (Georgios Mermigkas, FAO, 2019)
31
NTBs compared to the traditional non-technical barriers can cost exporters more requiring them to
enhance their product quality standard endogenously and getting through the conformity
assessment procedures. It adds costs equivalent to around 20% of the value of agricultural trade.
Ad Valorem Equivalents can align the cost of NTBs on an exporter in commensurate with the tarrif
rate. Based on UNESCAP and UNCTAD’s statistics, Figure 16 and 17 demonstrates that even in
weighted average terms, costs of NTMs are reportedly high in Asia. In the agricultural sector, NTMs
are found especially high on animal products (Workshop Presentation, Georgios Mermigkas, FAO,
2019).
Source: Workshop Presentation (Georgios Mermigkas, FAO – UNESCAP and UNCTAD 2019)
Figure 16: Import-weighted tariffs and Ad Valorem Equivalents (AVEs) of NTMs imposed by economies, by sub-region
Figure 17: Import-weighted tariffs and AVEs of NTMs, by sector
32
4.2 The Inspection and Quarantine Procedures for Imports to China
Overview of China’s Import Profile
With the goal to foster an open and transparent trade policy, China applies global market regulations
to also ensure safe and high quality food imports. The total value of agricultural products China
imported and exported reached 216.5 billion USD in 2018, indicating an increase of 8.32% from 2017.
From January to September 2019, the total value of agricultural products trade reached 165.8 billion
USD, up by 2.2% proportionately from 2017; among it, the export value was 56 billion U.S. dollars,
decreased by 2.3%, and the import value reached 110 billion USD, increased by 4.6% (Workshop
Presentation, Huang Haiqian, CFNA, 2019).
The following 10 Chinese provinces and autonomous regions have imported products accounted for
87.61% of China’s total agricultural import value in 2018 (Table 1).
Table 1: China's Agricultural Product Imports Viewed by Regions
No. Regions Import Value Year to Year increase rate
1 Shanghai 212.33 11.62%
2 Guangdong 166.51 10.17%
3 Beijing 227.72 9.90%
4 Jiangsu 251.91 18.78%
5 Shandong 206.93 6.03%
6 Fujian 127.73 4.05%
7 Guangxi 106.86 -5.47%
8 Zhejiang 69.56 12.69%
9 Liaoning 59.91 -3.99%
10 Tianjin 54.70 27.45%
Unit: 100 Million USD
Source: Workshop Presentation (Huang Haiqian, CFNA, 2019)
China’s Imports in Fruits and Meat
The total value of fruit products China has imported reached 8.3 billion USD from January to
September 2019, increased by 27.19% from the previous year. China overall has imported 5.8 million
tonnes of fruits, increased by 30.7% from the year before. The Compound Annual Growth Rate (CAGR)
for China’s fruit product import value was 10.55% in China between 2009 and 2018 (Figure 18).
33
Higher import volumn is expected according to the rising trajectory of China’s imports during the last
decade.
Figure 18: Development of China's Fruit Product Imports
Source: Workshop Presentation (Huang Haiqian, CFNA, 2019)
With regard to the main categories of fruit products imported into China, cherries imported mainly
form Chile ranks the fruit product engendering the highest import value, durians from Thailand and
bananas from the Philippines are increasingly popular in the Chinese market (Table 2 and Figure 19).
Table 2: Fruit Imports by Main Categories in China (2018)
No. Main Product Import Value Year to Year Rate
1 Cherry 13.8 69.37%
2 Durian 10.87 97.03%
3 Banana 8.97 54.73%
4 Citrus Fruit 6.31 14.56%
5 Grape 5.82 -1.16%
6 Kiwi 4.11 17.56%
7 Dragon Fruit 3.96 1.77%
8 Longon 3.63 -16.92%
9 Others 23.32 35.72%
Unit: 100 Million USD
0
20
40
60
80
100
0
200
400
600
800
2009201020112012201320142015201620172018
Import Volumn
（10 thousand tonnes）
Import Value
（100 Million USD）
34
Figure 19: Fruit Imports by Main Categories in China (2018)
Source: Workshop Presentation (Huang Haiqian, CFNA, 2019)
China input 50% of its fruit import value to its neighbouring Asian market (Table 3 and Figure 20).
Southeast Asian countries are suggested to utilise their tropical climate, seizing opportunities in
China’s autumn and winter seasons to sell tropical fruit species to meet Chinese consumers’ demand.
Table 3: Fruit Imports by Main Countries in China (2018)
No. Countries/Regions Import Value Year to Year Rate
1 Thailand 20.30 66.40%
2 Chile 17.16 66.69%
3 Vietnam 7.80 15.16%
4 The Philippines 7.78 37.39%
5 New Zealand 4.45 25.60%
6 The United States 3.94 -24.93%
7 Australia 3.34 20.32%
8 South Africa 2.50 2.01%
9 Peru 2.23 1.10%
10 Ecuador 1.50 49.57%
Unit: 100 Million USD
Figure 20: Fruit Imports by Main Countries in China (2018)
Source: Workshop Presentation (Huang Haiqian, CFNA, 2019)
Cherry16%
Durian14%
Banana11%
Citrus Fruit8%
Grape7%
Kiwi5%
Dragon Fruit5%
Longan5%
Others29%
Thailand25%
Chile21%Vietnam
10%
The Philippines10%
New Zealand6%
the United States5%
Australia4%
South Africa3%
Peru3%
Ecuador2%
Others11%
35
The total value of meat China imported reached 11.09 billion USD in 2018, up by 16.82% from the
previous year. In terms of the import volumn, China imported 4.1 million tonnes of meat in 2018, the
rate of increase is 3.9% (Figure 21). The CAGR for China’s meat import value was 20.61% in China
between 2009 and 2018 (Workshop Presentation, Huang Haiqian, CFNA, 2019). Despite the rising
trend for China to import more meat products in the coming years, in 2019, with reform taking place
in China’s SPS measures, registering entry to China’s meat market becomes more efficienct, nearly
300 meat exporting enterprises from the global market registered to be authorised meat exporters
for China, in comparison to a total of less than 800 meat enterprises registered in the past decade.
China’s meat market is opening up only at a greater speed (Workshop Presentation, Kong Xiaobang,
GACC, 2019).
Figure 21: Development of China's Meat Product Imports
Source: Workshop Presentation (Huang Haiqian, CFNA, 2019)
China’s rising imports denote significant trading opportunities for regional and global exporters. For
agri-food product exporters, as SPS standards and TBTs have risen to become the key measure
Chinese government undertakes to regulate agri-food product entry, ensuring compliance with
China’s NTBs carries rising importance.
China’s SPS measures for Meat and Fruits
Representatives from the GACC and the Ministry of Commerce affiliated organisation, CFNA, the
largest Chinese national agricultural and food product import & export Chamber of Commerce,
introduced the supervisory and inspection procedures China requires their trading partners to get
through importing meat and fruit products13. Based on their presentations, the SPS inspection and
market entry procedures for fruit and meat products to China have been summarised into a flow
chart (Fugure 22).
13 Foreign Fruit Products permitted to be exported to China, GACC Document Downloads: http://www.customs.gov.cn//customs/jyjy/dzwjyjy/qymd/zwjcp/2372452/index.html
0
50
100
150
0
100
200
300
400
500
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Import Volumn
（10 Thousand Tones）
Import Value
（100 Million USD）
36
Figure 22: SPS Inspection and Market Entry of Meat & Fruits Products into China
Source: Adapted from Workshop Presentations by Kong Xiaobang (GACC,2019) and Huang Haiqian (CFNA, 2019), in
combination with reference from the ‘Measures for Administration of Inspection, Quarantine and Supervision on Fruit
Products entering China’, GACC, 201814, and ‘Measures for Administration of Inspectio, Quarantine and Supervision on
Animal Products entering China’, GACC, 201815.
Remarks and Suggestions:
Before the 2018 reform on SPS Inspection, the evaluation on the national product system and the
enterprise registration process took place separately. In line with WTO’s suggestions, China has since
2018’s SPS reform, merged the two different practices and based its enterprise registry practice on
the trust towards the exporting countries. More efficient inspection and periodic evaluation can take
14 GACC, 2018 (November), Measures for Administration of Inspection, Quarantine and Supervision on Fruit Products
entering China. 15 GACC, 2002, Revised in 2018, Measures for Administration of Inspection, Quarantine and Supervision on Animal Products
entering China.
Application for Entry
•Exporters are first suggested to confirm whether protocals have been signed between China and their country on admitting the fruit product they aim to export to enter the Chinese market
•New species exports should be applied directly by the Exporting country through the Department of Animal and Plant Quarantine, GACC
Risk Analysis
•GACC starts risk analysis of the fruit product based on the technical materials provided by the exporting country and risk assessment dialogues
•GACC carries outon-siteinspection of the fruit products
Protocol signing
•Both China Customs and the exporting country acknowledge the inspection results
•Exporteing countries that fulfil the SPS requirements can sign the bilateral animal and plant inspection and quarantine protocolwith China, protocol has more specified requirement towards imported products
Enterprise Registry
•Enterprises apply for registry to Chinese market via their national authorities
•Exporting country's authority assess the applicant enterprises' SPS standards according to their protocol signed with China
•Enterprises that fulfil the requirements are granted with a domestic SPS certificate and a recommendation to GACC
Border Inspection
•By border inspection of the products will be carried out by GACC
•The "Permit to Import Quarantine Materials into the People's Republic of China" and the exporting country's domestic SPS certificate alongside other defined technical materials are both requried for submission at entry
Evaluation
•Video inspection and retrospective on-site inspection take place periodly for GACC to guarantee trading country's product safety& quality
•Product species recognised with disease in certain partnering countries, import admission for the certain species from the countries are banned till the risk is announced eradicated by authorities (e.g. World Organisation for Animal Health - OIE)
37
place in this fashion, however, risks are also embedded when trading partners do not deliver their
domestic inspection conducts following the protocol they have signed with China.
In case malfunction of the protocol is discovered at the border gate, i.e. enterprises which do not meet
the requirements agreed in the signed protocol are recommended to enter the Chinese market, a
breach of trust between China and the exporting country is likely to influence the trading relations
between the two countries in the long run. Therefore, countries are suggested to carry out inspection
of the meat and fruit products strictly following the protocol.
Questions and Answers after the presentations:
1. Can the presented information on export procedures to the Chinese market be accessed
transparently online?
GACC aims to ensure transparency of information. Suggested procedures to enter the Chinese market,
China’s protocols signed with other countries, details of the registered enterprises to varied Chinese
markets can all be accessed through GACC’s webpage.
2. How to acquire the full scope of the domestic regulations in China towards imported goods?
The then Administration of Quality Supervision, Inspection and Quarantine (AQSIQ), and now partly
merged into State Administration for Market Regulation (SAMR) and GACC, are responsible for
carrying out the inspection towards the import and export goods in the port provinces. According to
market standard in China, and concerns over safety, hygiene, health, environmental protection,
prevention of fraud, the agency deliver conducts under the People’s Republic of China Import and
Export Commodity Inspection Law. Further information can be accessed online. Research and
according capacity building efforts into Chinese economy’s domestic regulation is suggested.
3. How long averagely does it take for a protocol to be signed between China and the exporting
country?
Efficient protocol signing requires both the exporting country and China’s in-time actions. In cases
where significant hygiene / safety / quality issue is found and to be found, a protocol can even years
to be finalised. Some countries also take long to accomplish the application form, answering technical
questions from China; some need to go through complex legislative procedures in their government.
Fast signing however, takes only one to two months and in general terms it takes 6 months to a year’s
time.
4. As animal by-product sales are supported by CFNA, are there opportunities for countries to
connect with CFNA and estbalish trade relations with the Chinese enterprises CFNA
supports?
CFNA provides business consultancy for its enterprises and organise exhibitions on regular basis,
and therefore can serve as a bridge for win-win animal by-product trades to be facilitated if foreign
enterprises are interested.
38
5. How does CFNA collect its data?
CFNA especially focuses on animal products. It has a database on the imports and exports of animal
products. The database first collects data when protocols are signed between countries for
estimating im/export volumns and values. The second data collection takes place at the port through
logistics system. The third step is data collection inside Chinese domestic market for import product
data and Chinese company revenue forexport product data. When analysing other products, CFNA
acquires data from GACC database.
4.3 Matchmaking Opportunities
COFCO – China’s Largest Agri-food Corporation
Business Structure: COFCO is a state-owned agri-food enterprise taking up the largest food market
shared in China. Meat, Dairy, Oil and Oilseeds, Grains and Cereals as well as other agri-food categories
are the conventional products COFCO specialised in.
Within the e-commerce sector, COFCO developed its own platform “Womai”, through which it
introduces further imported agri-food products to Chinese customers.
COFCO imports agri-food products from around the world, especially from China’s neighbouring
countries where consumers’ preferences share more similarities. However, the trading partners need
to have their products first aligning with GACC’s requirements to utilise COFOCO’s distribution
channels. In China, all products and services, either domestically produced or imported, need to
comply with China’s national standards, which are officially called Guo Biao Standards (GB
Standards). COFCO suggests exporters to research into China’s food GB standards, market orientation,
TBTs and select permitted products best responding to Chinese consumers’ preferences.
ATPC Expositions
Expos are efficient platforms for agricultural exporters to broaden their networks and grasp business
opportunities. Three main expos are held every year by ATPC (Table 4). Registration has already
been opened for year 2020 and delegates from Cambodia, Laos, Mongolia, and Vietnam were invited
to partake in the expos. New attendees can be supported with travel expenses upon discussion.
Table 4: ATPC Expos
Name of the Expo Expected Date for Organisation
China International Food Ingredients Expo (CIFIE) 16-18 Oct 2020
China Potato Expo Jul 2020
China Fisheries and Seafood Expo 28-30 Oct 2020
More information on the expos can be accessed via ATPC’s website.
39
5. Recommendations and Way Forward As can be retrieved from the gathered outcomes of the Conference and the Regional Exchange,
China’s role in global agricultural trade has been continuously rising, having significant impact on
market potentials for exporters and importers. China puts eminant emphasis to ensure food security,
and aims to attain higher food quality to meet consumers’ demand. These policy and market criteria
towards the agri-food products are in turn reflected in the transformation of China’s SPS measures.
For exporting countries, therefore, developing an efficient system to in-timely keep track of China’s
latest SPS policies is crucial. As a digital information distribution platform, the Lao Trade Portal or
Lao Service Portal as well as the Vietnam Trade Information Portal could serve as examples to keep
up with information on free trade agreements (FTAs) and further trade policies. To be recognised as
qualified exporting enterprises and access China’s domestic regulations, businesses are suggested to
research into GACC’s Website for detailed requirements. Further online tools to enhance knowledge
on trade statistics in agriculutre and other fields are compile the SRECA Project Website, listing
international, regional, and national information portals.
GIZ will further support Viet Nam, Lao PDR, Cambodia and Mongolia with trade capacity building
measures in order to overcome barriers to trade. A status report on SPS regimes in Cambodia, China,
Lao PDR, and Vietnam has already been compiled, accessible. The document can be downloaded here.
SRECA is also working with partners and other GIZ projects on site to implement further trade-
related services like step-by-step export guidelines to China for SMEs, fact-sheets on SPS
requirements, or public-private dialogues on export processes. So far, the guidelines in Vietnam for
dragon fruit, watermelon, longan, and lychee, and the guidelines in Cambodia for mango, longan and
dragon fruit have been published in local languages and can be downloaded here.
To support the four project focus countries in developing further capacity on market access to China,
the project will implement further regional exchange platforms with Chinese key actors like ATPC,
GACC, CFNA, and further stakeholders. As multipliers, relevant project partners from public agencies
and private associations from Cambodia, Lao PDR, Mongolia, and Vietnam are supposed to be
addressed. Capacity building on trade-related services on a regional level, will be strengthened by
triangular or bilateral follow-up activities with partners in the focus countries.
Participants and relevant actors will be informed about further project activities in 2020 as well as
provided with project studies and research on agricultural export and market access to China. For
any remarks and questions, please contact Ms. Junyu HUO ([email protected]) .
40
6. Project “Support of Regional Economic Cooperation in Asia (SRECA)”
Background
Reducing tariff and non-tariff barriers is key in encouraging the free flow of trade and stimulating
cross-border investment between countries. The implementation of trade facilitation measures and
increasing trade-related services is crucial to overcome limited domestic markets, especially for
small and medium enterprises (SMEs). Given the development gaps in the region, lesser developed
countries such as Lao People’s Democratic Republic, Viet Nam, Cambodia and Mongolia encounter
obstacles in fully reaping the potential benefits of regional economic integration, with businesses
lacking the capacity to overcome trade obstacles and national administrations facing difficulties in
implementing rules and regulations for cross-border exchange.
Our Approach
SRECA, commissioned by BMZ and implemented by GIZ,
works with four selected focus countries –Cambodia, Lao
PDR and Vietnam in the framework of the ASEAN-China
Free Trade Area (ACFTA), and Mongolia in the framework
of the Greater Tumen Initiative (GTI) – and the PR China.
The latter is to adopt an active role as both an economic and
development partner to ensure the equal inclusion of the
focus countries’ interests in regional and global integration
processes. The objective is to improve the conditions for
regional and global agricultural trade in the selected focus
countries. The project supports public stakeholders at the
regional, national, and provincial level as well as giving
direct support to export-oriented business associations
and SMEs in the field of agricultural trade. To effectively
implement its measures, SRECA cooperates closely with
respective partners on site as well as further bilateral or regional GIZ projects in the focus countries.
Focus Areas
• Enhancing the access of SMEs in Cambodia, Lao PDR, Mongolia and Vietnam to trade-related
services for agricultural export
• Strengthening the structures for cross-border (sub-)regional cooperation between the focus
countries and China
• Fostering regional and triangular measures for knowledge exchange among the focus
countries and with China in the field of regional economic cooperation
A special focus is put on the inclusion of female entrepreneurs in regional economic integration processes and the utilisation of digital applications and tools.
The project is affiliated with the Sino-German Center for Sustainable Development.
Commissioned by German Federal Ministry for Economic Cooperation and Development (BMZ) Focus Countries Cambodia, Lao People’s Democratic Republic, Viet Nam, Mongolia Overall Term 2019-2022 Overall Goal Economic cooperation and agricultural trade between the focus countries and China is strengthened Further Information http://connecting-asia.org/
