Asia–Pacific food markets and trade in 2005: a global, economy–wide perspective

Abstract

Rapid industrialization in East Asia, particularly China, is raising questions about who will feed the region in the next century and how Asia will be able to pay for its food imports. The paper ®rst reviews existing food sector projections and then takes an economy-wide perspective using projections to 2005, based on the global CGE model known as GTAP. After showing the impact of implementing the Uruguay Round, the paper explores several alternative scenarios. A slowdown in farm productivity growth is shown to be costly to the world economy, as is slower economic growth in China. Failure to honour Uruguay Round obligations to open textile and clothing markets in OECD countries would reduce East Asia's industrialization and thereby slow its net imports of food. On the other hand, the trade reform that is likely to accompany China's (and hence Taiwan's) membership of the World Trade Organization (WTO) adds 30 per cent to estimated global gains from the Uruguay Round. Their WTO accession is projected to boost exports of manufactures and strengthen food import demand by not only China but also its densely populated neighbours with whom it trades intensively.The 1995±96 season saw a dramatic rise in international grain prices and a drop in per capita world grain stocks to near-record low levels. That, together with concerns about the erosion of agriculture's resource base, and in particular the projections by the Worldwatch Institute suggesting massive grain imports by China in the twenty-®rst century, have called into question the long-term prospects for the world food situation. By contrast, a soon-to-be-published study by Mitchell, Ingco and Duncan suggests grain will be abundantly available for the foreseeable future so

Agriculture and Non-Agricultural Liberalization in the Millennium Round

“…Following earlier projections work with the GTAP model (Gehlhar et al, 1994;Anderson et al, 1997, we assemble external projections for population, skilled and unskilled labor, investment and capital stock. When combined with assumptions about likely productivity growth rates, this permits us to predict the level and composition of GDP in 2005, as well as trade flows, input usage, and a wide range of other variables.…”

China's Accession to the WTO: Timing is Everything

“…China's application to join the WTO has aroused a number of concerns from both developing and developed member nations. Some of the issues raised have included how China's growth and accession will affect the world food markets (Anderson, Dimaranan, Hertel and Martin, 1997); whether China's accession will further increase the U.S. trade deficit (USITC, 1999); whether increased competition will result in lower real wages for skilled and unskilled workers (Scott, 1999); and how increased competition will affect the development prospects of other nations in South Asia who compete in similar markets to China.…”

Long-Run Impacts of China’s WTO Accession on Farm-Nonfarm Income Inequality and Rural Poverty

“…What they underscore is that whether a particular group gains or loses from a shock such as WTO accession in the long run depends heavily on their sources of household income and their capacity to adapt to the changed economic circumstances. 15 They are especially small when compared with the changes that are taking place in the course of normal economic growth, as shown retrospectively in Tables 1-5 above and prospectively in earlier analyses by Anderson et al (1997a, b) and in Ianchovichina and Martin (2002).…”