Monday, April 30, 2012


China's food production has achieved amazing growth rates in the past which showcases its prowess in modern agriculture technology. Though its population is growing at a moderate level, the food production has always kept ahead of population increase every year. But for occasional droughts and floods, there does not seem to be any major hiccup in food availability and even under such conditions the country is in a position to spend liberally on imports using the vast foreign exchange reserves it holds. Therefore it does not come as a surprise to see the targets for food production hiked recently for achieving a 100% growth in just three years! With a tight control over the economy and very little personal freedom, it may not be a surprise if the country gets to the post easily. Here is a take on this claim by China regarding its dream for doubling food production by the year 2015. 

"China has issued the 12th Five-Year Plan for its food industry, aiming to have output of 12 trillion yuan ($1.9 trillion) by 2015, the National Reform and Development Commission and the Ministry of Industry and Information Technology said in a joint statement. During the previous 5-year period (2006-2010), China's food industry generated an output of 6.1 trillion yuan, accounting for 8.8 percent of the country's total industrial output during the same period. To realize its output goal, the plan calls for a restructuring of the food industry. The plan sees food conglomerates as a major driving the force in the sector, accompanied by small and medium-sized enterprises.Chinese officials say they are making stronger efforts to address China's long-term food safety concerns amid rising public outcries that the country's food products can't be trusted. Scandals in the food sector are a nerve-racking issue for the Chinese authorities; numerous measures to enforce standards have failed to have the desired effect, meaning food safety remains a major public concern. Inefficient inspection methods -- an issue partly attributed to supervisory powers being shared between different government organs -- have been widely cited as a main cause. According to the plan, China will raise the threshold for businesses in the food sector and establish a sound monitoring system for food safety in addition to a different mechanism that attributes food safety responsibilities to businesses involved. Earlier this week, Chinese Premier Wen Jiabao said that China would not tolerate any move that sacrifices the health of the population to achieve profit-taking".

The statistics put out by Chinese may need closer scrutiny because of its obsession with glorifying the communist philosophy though independent international agencies have the means to verify production statistics scientifically. Interestingly the production increase is projected in terms of value , not in volume and there is always the inflation element that can vitiate the actual production figures. Even then the production increase will be substantial if Chinese are able to achieve the target. World needs to be worries about the quantum jump in food production in China because of its likely impact on global food prices. If Chinese chooses to export large quantities, the global food prices are bound to crash affecting the economy of many agricultural produce exporting countries, most of them being poor ones. Post-2015 era will be interesting to watch.


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