Mon, Oct 19, 2015 - Page 8 News List

Agrarian reform must precede TPP

By Du Yu 杜宇

These are some of the ways that farmers could respond to cheaper, but less safe imported products that would enter the nation as a result of free-trade agreements.

Second, there is a need to increase industrial competitiveness. In the government’s annual agricultural budget of more than NT$100 billion (US$3.07 billion), up to 60 to 70 percent is paid out to farmers as welfare benefits, crowding out other agricultural policies.

In this year’s budget, between 20 to 50 percent is being used for agricultural development, while the money allocated for agricultural research is even lower. This is far less than agriculturally advanced nations, which slows the pace of agricultural restructuring and is useless in raising farmers’ incomes.

Given that science and technology are key to Taiwan’s agricultural transformation, the government should review the budget, increase funding for industrial research and development — including encouraging research and development among farmers themselves — so that the limited funds have a maximum multiplier effect.

Furthermore, to make progress in structural adjustments, in addition to accelerating generational change in rural areas, a joint farming system should be introduced. That would allow older farmers to keep their farmland and choose their partners by contracting their land to, for example, cooperatives, production and marketing groups, agricultural enterprises or high efficiency farmers. This would help elderly farmers to grow cash crops that are encouraged by the government. The farmers would receive subsidies and the cash crops would yield dividends after harvest. The farmers would not need to worry, as they do now, about a supply and demand imbalance.

Finally, in the past, to cope with accession to the WTO, government departments allocated hundreds of billions of New Taiwan dollars in bailout funds to cover the losses resulting from agricultural imports. Although this was partially effective, it did not have the desired effects on the adjustment of industrial structure, improving agricultural competitiveness, increasing farmers’ income, reinforcing the agricultural labor force and so on.

In-depth review is needed to bring improvements, such as financial management and control, to avoid making the same mistakes again.

Du Yu is chief executive officer of the Chen-Li Task Force for Agricultural Reform.

Translated by Clare Lear

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