China to post record farming trade deficit due to WTO entry: paper

Asian Economic News, Jan 10, 2005

BEIJING, Dec. 31 Kyodo

China is set to post a record-high $5.5 billion trade deficit in agricultural products in 2004, partly due to an influx of foreign products linked to the country's entry into the World Trade Organization, state media reported Friday.

''The country has become a net importer of agricultural products three years after joining the WTO,'' the China Daily quoted Ke Bingsheng, director of the Agricultural Ministry's Research Center for Rural Economy, as saying.

The paper quoted Ke as saying that imports increased as China moved to fulfill its commitments to widen market access to foreign commodities by reducing tariff rates on agricultural products.

China joined the WTO in December 2001, in a move widely seen as a major milestone in China's integration into the global economy.

While the expected trade deficit indicates that China, a major agricultural goods exporter, has begun to rely on imports to feed its own people, Ke said that should not be a reason for panic, according to the paper.

China's self-sufficiency in grain still exceeds 96 percent, even if China uses up its committed tariff-rate quotas, or minimum market access, on corn, rice and wheat imports, Ke was quoted as saying.

Agricultural Minister Du Qinglin said earlier that China has greatly improved its grain production capacity and has the ability to rely on itself for its food supply, the paper said.

Of the total farm produce imports this year, edible oils and oil-linked imports such as soybeans are likely to account for 40 percent, according to the paper.