Research Reports
Korea-China Agricultural Trade: Competitiveness & Trade Barriers
-
AuthorMoon, Hanpil
-
Publication Date2011.11.30
-
Original
Based on the analysis of agricultural trade pattern between Korea and China in the context of competition or complementary cooperation, this study synthesizes several factors affecting their agricultural trade structure, gives a comprehensive outlook on structural changes in agricultural trade between the two countries, and finds some implications for Korean agriculture.
Agricultural trade between Korea and China shows a clear one-way trade from China to Korea and consists mainly of inter-industry trade. The products available to intra-industry trade are rare with the exception of several processed foods. This overwhelmingly unbalanced trade structure makes it difficult for two countries to avoid severe competition and build mutually beneficial cooperative relationship in agricultural sector, and is not expected to change in the near future.
The implications from our analyses on relevant issues in agricultural trade structure between Korea and China are summarized as follows;
First, agriculture in two countries has similar production structure and development course, but also has distinctive resource endowments and growth stages, which lead to current overwhelming one-way trade and leave not much room for complementary relation in the near future. It is necessary to find a constructive cooperation plans between the trading partners towards co-prosperity under the more liberalized trade in the future, focusing on the establishment of specialization system reflecting their comparative advantages in agricultural production.
Second, the survey results reflect the change of consumer perceptions about chinese agricultural products toward more positive direction. Korean residents in China and restaurant managers, who have experienced chinese agricultural products more than general consumers, responded more positively about tastes, food safety, prices of chinese agricultural products and showed higher willingness to pay than general consumers did. It suggests that general consumers are likely to become more positive on chinese agricultural products if they have more opportunity of direct access to these products, implying potentiality of import increase of chinese agricultural products when the bilateral FTA is in effect.
Third, the removal of inspection and quarantine barriers usually takes quite a long time, because the import prohibiton of a product on account of plant disease, pest, and animal disease is lifted through various risk assessment process having eight steps. Recently, however, exporting countries and international organizations are seeking to reduce the period of the risk assessment and to set a common standard. Bilateral quarantine negotiations are also affected by political and diplomatic situations and may accelerate the procedure.
Fourth, Chinese government has adopted several policies for promoting disease-free agricultural production regions. Also, China is trying to introduces the concept of regionalization in its FTA negotiations, persuading their trade partners. Therefore, Korean government should prepare for the possible request of Chinese government on the issues in the forthcoming Korea-China FTA negotiation.
Researchers: Moon, Hanpil; Choi Sei-Kyun, Dae Hee Chung
E-mail address: hanpil@krei.re.kr
- Next
- A Research for the Establishment of Korea-China Agriculture Policy Simulation Model
- Prev
- Depicting Alternatives for Amending and Promoting Support Systems of Social Enterprises Located in Rural Areas