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Taiwanese farms must upgrade to best quality

`Emergency exports of agricultural products during a glut is not a solution.'

Oranges are just entering their peak season in Taiwan, but Beijing and Taiwan's pro-China forces have already joined hands and said that they want to buy Taiwanese oranges. One can't help but wonder whether this is not another one of Beijing's "united front" tactics.

Remember when there was a glut of bananas in Taiwan last October? Beijing announced then that it would purchase a total of 2,000 tonnes at a cross-strait forum on agriculture sponsored by the Chinese Nationalist Party (KMT) and the Chinese Communist Party. A report released recently by the Council of Agriculture, however, shows that China in effect bought a mere 118 tonnes -- or 5.9 percent of what it promised to buy -- for a total of less than NT$2 million (US$610,000).

At that time, quite a number of Taiwanese organizations offered to boost their banana orders, while consumers started purchasing more bananas on a daily basis to help struggling farmers. However, certain media outlets mocked these efforts, saying that "even if all Taiwanese stuff themselves with bananas, they are still not not going to help the situation improve."

Statistics say otherwise. Two weeks after the issue was made public, domestic orders for bananas increased by more than 200 tonnes, allowing the wholesale price of bananas to recover to a reasonable level.

Emergency exports of agricultural products during a glut is not a solution. It would certainly be a good thing if Taiwan could sell its surplus produce to China -- without politics involved. However, as the experience with trying to sell bananas to China shows, business opportunities created as part of Beijing's "united front" tactics are deceptive. They either quickly vanish when the political end is fulfilled, or never materialize.

Taiwan should adopt a pragmatic approach in liberalizing its produce market to ease the pressure on local farmers. The Chinese market could be one of the links in Taiwan's agricultural export chain, but it is not the most important link, nor is it the only link. Taiwanese should not put all their efforts into investing in a high-risk market like China. Nor should Taiwanese farmers harbor any illusion that China's offer comes with no strings attached or give up on concentrating their efforts on adjusting and upgrading the agricultural industry as a whole.

Ever since Japan adopted stricter measures to test for chemical residue in agricultural products last May, some Taiwanese farmers have turned their eyes to China, which has less stringent import measures. That's a short-sighted strategy. If Taiwanese farmers could upgrade their agricultural technology and quality control to meet Japan's strict criteria, they would have an edge over their rivals and avoid the cut-throat competition in lower end markets. This would increase their chances of breaking into markets that demand higher quality standards like the US and Europe.

Both the Taiwanese government and farmers should view China's failure to purchase 2,000 tonnes of Taiwanese bananas and Japan's move to raise its inspection criteria for agricultural products as a turning point rather than a crisis.

Roger Wu is professor of agriculture economics at National Taiwan University Translated by Daniel Cheng
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