Compared with industry and commerce, the relative weakness of the agricultural sector and the collective weakness of farmers have seen governments around the world adopt different measures to protect their agricultural industries.
As much as NT$70 billion to NT$80 billion (US$2.4 billion to US$2.74 billion) of Taiwan’s annual agricultural budget of almost NT$100 million is spent on subsidies. However, official information shows that annual incomes for farmers in Taiwan are still very low, on average less than NT$200,000.
Farming is tough work that does not reward farmers as well as they deserve. Many farmers have to go so far as to take out loans to stay in business and this has led to many young people going to places like Australia and New Zealand to work in farming to make some money.
Unchecked agricultural subsidies have contributed to huge financial burdens, lower usage rates for farmland, idle farmland and even the abandonment of farmland. This clearly shows that the way Taiwan uses its agricultural funds and the way subsidies are given out have now reached a stage where they need to be totally rethought.
Because standards for those applying for subsidies for fallow farmland are more lax, and because of a lack of effective monitoring of those receiving these payments, many people have been able to exploit the related laws.
This has generated widespread concern about phoney farmers taking government subsidies. However, so far, the relevant government bodies have failed to deal with this problem and this has seen an increase in the number of fake farmers claiming these subsidies, putting further strain on national finances.
A few days ago during an interview with the media, without even being asked, officials from the Council of Agriculture said that as much as 60 percent of the approximately 160,000 farmers who receive two lots of subsidies per year for farmland over 50,000 hectares that has been left fallow were not farmers at all.
Likewise, according to a survey on farmers’ incomes conducted by the Directorate-General of Budget, Accounting and Statistics (DGBAS), 40 percent of elderly “farmers” who receive subsidies are not engaged in agricultural work.
I believe investigative agencies should get to the bottom of this and force civil servants to give law-abiding farmers an explanation as to just what is going on.
Agricultural subsidies are the most frequently used policy tool by countries around the world to protect agriculture. Initially most countries adopted price support mechanisms for agricultural products.
However, as trade liberalization started and financial burdens became heavier, most nations made the gap between farmers’ output and their incomes the major focus of their policies. Taiwan on the other hand is still using price support polices. The current way Taiwan carries out agricultural subsidies has many aspects worthy of closer scrutiny.
For example, advanced Western nations also give out subsidies for farmland that is left fallow, but also emphasize “environmental subsidies,” whereas Taiwan merely emphasizes the quantity and amount involved in the subsidies given out while neglecting environmental management methods. This has caused large amounts of land going to waste, with pests causing further damage and polluting water sources.
Apart from the problem of subsidies for farmland that is left fallow, there is much inefficiency in Taiwan in terms of price subsidies for food and this results in distorted markets, the destruction of resources and additional environmental pollution. These are problems we really need to fix.
In the future, when Taiwan is thinking about how to adjust measures for purchasing agricultural products at guaranteed prices, apart from carrying out fixed payments, it is even more important that the actual conditions of industry and the market be taken into consideration and a diversified planning mechanism formulated. This is the only way that farmers’ incomes can be guaranteed while also ensuring efficient food production.
Concern over global climate change has led to an increased awareness of environmental protection and growing concern about food safety among consumers. Agricultural protection policies in advanced nations such as those in the EU have shifted away from merely focusing on the income of farmers and agricultural development, and instead developed an emphasis on agricultural and rural development coupled with a focus on agricultural environments and sustainable development in rural economies.
To achieve these goals, such nations have adopted measures such as assisting farmers in engaging in production according to EU standards, giving subsidies to farmers who produce high-quality agricultural produce, giving subsidies to farmers who adopt more advanced animal husbandry feeding methods and increasing the number of investment subsidies for young farmers to encourage them to get into agriculture.
They have also placed a special emphasis on those who meet the necessary environmental standards while also giving subsidies to those who engage in multifunctional forms of agricultural production in the hope of increasing the quality of agricultural products.
Additional benefits include the improvement of the environment in rural areas, leading to an increase in the diversification and multifunctional use of rural economies. This leads farmers to adjust the structure of their agricultural production, increasing environmental awareness among them and increasing the international competitiveness of their agricultural products.
These are all measures Taiwan’s agricultural bodies should seriously consider adopting, as they are the only ways to give farmers a tangible sense of improvement and recovery.
Du Yu is chief executive officer of the Chen-Li Task Force for Agricultural Reform.
Translated by Drew Cameron