Beijing pledges reform of hard-hit rural sector

PUBLISHED : Wednesday, 17 February, 1993, 12:00am
UPDATED : Wednesday, 17 February, 1993, 12:00am

CHINA yesterday pledged to ease the increasingly serious financial burden of farmers in poor inland districts by improving grain production and distribution and encouraging the development of rural industry.

The government in Beijing would also promulgate new legislation to prevent local authorities making arbitrary financial demands on the peasantry, Agriculture Minister Liu Zhongyi said yesterday.

The new Agricultural Basic Law, currently before the National People's Congress Standing Committee, would go a long way to help control the imposition of unreasonable charges and levies on poor farmers, Mr Liu said.

Speaking at a press conference in Beijing, he said the financial burdens faced by farmers in poor areas had been increasing ''very fast'' and were now ''very high''.

Local authorities, in their desire to develop as quickly as possible, were charging farmers directly for infrastructure projects, roads and telecommunications, even though the farmers could not afford such charges, he said.

Local governments should only charge farmers for projects that were in accordance with the local area's means and needs and should never force farmers to make payments. All contributions to local projects should be voluntary.

Although the practice of arbitrary charges had declined slightly since Beijing issued a number of urgent circulars in the second half of last year demanding that local governments reduce the burden on farmers, Mr Liu admitted the government could not legislate the problem away.

The fundamental task, he said, was to improve farmers' standard of living.

''If farmers become prosperous, they will not feel the burden [of these charges] so much,'' he said.

''For example, in the coastal areas where the rural economy is quite strong and there is a concentration of township and village enterprises, farmers do not feel a financial burden.

''It is the township and village enterprises in these areas which pay for development projects so the farmers do not have to pay any money out of their own pockets.'' As such, he added, farmers in prosperous areas could easily afford to pay for the installation of modern telecommunications, even satellite television.

To achieve economic development in the poorer areas, Mr Liu advocated the co-ordinated and comprehensive development of processing industries rather than concentrating on single crop production as in the past.

Farmers in poor grain-growing areas, for example, should utilise grain products more effectively to provide animal feed which could then be used for livestock raising, leading to meat industries and leather processing.

''All rural areas should try to develop the overall growth of agriculture, including farming, forestry and livestock breeding so as to effectively enter the market place,'' he said.

Mr Liu stressed, however, that the rural economy could not grow unless grain production, the backbone of agriculture, was guaranteed and enhanced.

''If grain production can grow, other problems can be solved relatively easily,'' he said.

The government would actively support grain production and take measures to ensure the interests of grain producers were protected.

Mr Liu stressed that this would not be achieved through price subsidies but through investment in basic infrastructure, irrigation, water conservancy and mechanisation.

But perhaps the most important measure to be taken if China was to realise its goal of producing 500 million tonnes of grain a year by the year 2000 was the reform of the grain market, he said.

Farmers needed a better information network and the country should establish a co-ordinated wholesale and futures market.

The minister also suggested that when China re-joined the General Agreement on Tariffs and Trade (GATT) it would not resort to price subsidies to protect agriculture.

''China's agriculture has the advantage of having comparatively low labour costs as well as several special products and techniques, so I'm confident we can compete on the open market under the terms of the GATT,'' he said.

Mr Liu said, however, that China should be accorded the preferential policies given to developing countries under GATT if it was to compete fairly.