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China's agricultural and rural policy is evolving rapidly. Strict
central planning and taxation of agriculture (1950s to 1970s) has
been replaced by reliance on markets and agricultural subsidies
in the 21st century. China has an ambitious and challenging set
of objectives. The government is using an array of subsidies, tax
cuts, and infrastructure spending policies to boost lagging rural
incomes, preserve social and political stability, encourage grain
production, improve food safety, prevent environmental degradation,
and increase agricultural productivity. The following table provides
a brief overview of the main agricultural policy measures used by
the Chinese government. The measures are used by the national government
unless otherwise specified.
Summary of China's agricultural
policy measures |
Measure |
Description |
Direct subsidies |
Provide small payments to grain farmers based on historical
grain acreage; introduced in 2004. Subsidize purchase of high-quality
seeds and agricultural machinery. |
Agricultural tax cuts |
Eliminate taxes on farmers. |
Improved market infrastructure |
Establish and support wholesale markets, commodity exchanges,
and futures markets. Promote e-commerce and improve cold storage
and transportation facilities. |
Rural infrastructure investment |
Fund water-efficient irrigation, drinking water, electrification
projects, methane plants, a rural road network, antipoverty
efforts, and develop "production bases" for grain or other
commodities. |
Loans for farmers and agribusinesses |
Direct rural credit cooperatives to extend more loans to farm
households. Give preferential bank loans to selected agribusinesses
that contract with farmers. |
Land protection |
Strictly enforce rules regarding conversion or sale of cropland
for nonagricultural use. |
Research |
Consolidate and increase funding for research institutes developing
crop and livestock varieties with improved quality and yields.
|
Food safety standards |
Establish and enforce standards for chemical residues
and other harmful substances in food. Establish animal disease
monitoring
and control systems and safe livestock feed production. Promote
organic and "green" agriculture. |
More on China Agricultural Policy:
China's Market Stabilization
Measures
China's Policies Affecting Factors
of Production and Inputs
China's International Trade Policies
China's History of Agricultural
Policy
For More Information:
See briefing room readings page for ERS reports on Chinese
policies.
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