As Taiwan's entry into the WTO draws closer, local rice farmers and agricultural officials are girding for the impact cheap foreign rice entering the market will have on domestic growers.
"We're headed for problems," said Kuo Chih-hong (
Kuo lamented that the "high cost of labor and Taiwan's small tillable land area have a great deal to do with our inability to compete with rice producers from America and China."
According to data from the Council of Agriculture, the high costs of production in Taiwan means that rice grown locally is three-to-four times more expensive than that grown in other countries.
A survey of international rice prices showed that 1kg of foreign-grown rice cost an average of NT$10, while Taiwan-grown rice costs NT$34 per kilogram, according to the council.
The government is considering to place a cap of NT$23 per kilogram on imported rice for retail sale after entry into the WTO, according to the council.
Taiwan's 800,000 rice farmers are set to feel the heat of cheap foreign imports in the first year after Taiwan enters the WTO, which is expected early in 2002. In that first year the government initially will allow 144,700 tonnes -- or 8 percent of total rice consumption -- of foreign rice to be imported.
While the council is planning to restructure the sales and marketing of home grown rice by putting smaller farming cooperatives into larger groupings to promote a "buy Taiwan" attitude, some of Taiwan's big food manufacturers are already slithering to get their teeth into the cheap foreign product.
Earlier this month Wei-Chuan Foods Corp (
The government's response to the new competitive environment is to cut Taiwan's rice output to bring supply more in line with demand and soften the impact of lower demand with subsidies for farmers that switch to cultivating other crops. Outlined in the council's policy response to entry into the WTO is a plan to shrink Taiwan's annual rice output which calls for the total land area of Taiwan's rice growers to be slashed by 50,000 hectares over the next few years.
While the plan also calls for newly disused rice paddies to be converted for farming other crops, it is unavoidable that farmers, many of whom are well into their middle age, will find themselves out of work.
"Many of our farmers are old and if they lose their jobs there is little they can do," said Wu Yuan-chang (
Further rising unemployment could cause social problems in farming communities, Wu said.
"How severely our industry is affected will depend largely on what sort of assistance we get from the government," Wu said.
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