ABSTRACT
China’s large population size and a significant proportion of its people living in
rural areas suggests that WTO accession will have significant implications for its
agricultural sector and the rural population. The Chinese agriculture is generally
considered to be very vulnerable to tariff reductions resulting from trade
liberalization under the terms of accession. The former Chinese Premier Zhu
Rongji openly expressed his concern about the negative impact of accession on
China’s agriculture and rural incomes. Reduction of tariff and non-tariff barriers
will raise import competition for Chinese agriculture resulting in lower prices
which will depress farmers’ incomes. In this chapter we discuss China’s
commitments in terms of agricultural trade, the short and long-term effects of
tariff reductions on resource allocation, and rural incomes. We argue that the
agricultural impact of accession is better understood in terms of the effects on
rural incomes than on rural unemployment. The latter is a more ambiguous
concept in the case of agriculture than the concept of the working poor.
