Sat, Mar 15, 2014 - Page 8 News List

Half-baked pilot zones ruin recipe for success

By Du Yu 杜宇

Pineapple cakes are a very popular gift to bring when visiting friends and relatives. Relying on processing and marketing strategies, businesses have created a pineapple cake industry worth NT$25 billion (US$824 million) per year, much higher than the value of pineapples sold on their own. The area planted with pineapple has increased by more than 1,000 hectares, and some businesses and pineapple farmers have entered into agreements to guarantee the supply and stabilize the price — NT$10 per 600g — and this helps increase the income for farmers.

A deeper analysis of why pineapple cakes have become so popular in recent years reveals that it is because the core ingredient is locally produced pineapple in combination with a golden recipe and outstanding marketing. It is the combination of these things that has created this little Taiwanese miracle. It is probably easy for consumers to imagine whether the taste and quality would be the same if pineapples were to be imported and combined with domestic processing technology and labeled as “Made in Taiwan.” Would consumers still be willing to buy the product, even if it looked the same?

Pineapple cakes can serve as an example when looking at the free economic pilot zones. With respect to value-added agricultural processing, one of the five focal points of the zones, the government repeatedly declares that it will improve agricultural business in order to benefit farmers. This slogan does not stand up to the test. Consumers are willing to spend more on products made in Taiwan because they trust the quality, processing techniques and food safety of locally produced agricultural products. If the government wants to import large volumes of agricultural raw materials of different varieties, but with similar names and of different quality — citing the restricted production area and production volume of agricultural products in Taiwan — and then process these raw materials in the free economic pilot zones before exporting them under the “Made in Taiwan” label in a process a bit like selling good rice with grain of lower quality mixed in, it might look like an improvement to agricultural business, but it would in fact spoil the recipe. Why would consumers continue to buy products with the “Made in Taiwan” label on them? Such a policy would have a negative impact on Taiwan’s farmers and agricultural industry.

Even if the government managed to find other distribution channels for pineapple cakes made in the free economic pilot zones, that would only brighten up Taiwan’s export figures a little. The true beneficiary would not be the Taiwanese farmer or the Taiwanese agricultural industry. It is important that this remains clear.

President Ma Ying-jeou (馬英九) has on several occasions demanded that the legislature pass the law regulating the free economic pilot zones during its current session. He has also issued instructions that ministers and agency heads do more to support this policy. The main reason the government cannot gain majority support is that its policies and its ability to implement them fall far short of public expectations, since Taiwanese have grown tired of glib government officials.

The free economic pilot zones are not critical to the future of local agriculture. The authorities concerned should integrate industry, government, academia and researchers in a search for other local crops to use as core raw materials for new products, such as sweet potato, taro and red bean. They should then rely on proven processing technologies and marketing strategies to create yet another Taiwanese agricultural golden miracle.

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