By Wang Jiping
China is famous for its advanced production technologies and high-quality products in the field of agriculture, while most ASEAN countries have an agriculture-based economy, demanding agricultural machinery and goods. Some agricultural experts have long believed that China and ASEAN are good trade partners which can achieve win-win outcomes in this area.
Today, against the background of the rapidly developing sphere of big data, “bringing in” and “going global” take centre stage and the China-ASEAN Free Trade Area (CAFTA) is being advanced. What have China and ASEAN gained in terms of cooperation in the traditional field of the agricultural means of production? In the future, what kinds of efforts they should make together?
With these questions, China Report ASEAN sat down to talk with Li Dianping, Chairman of China-ASEAN Chamber of Agricultural Commerce (CACAC).
Growing from Zero
Thanks to successful policies that have been launched during the past 26 years and improvement of the bilateral trade environment, China-ASEAN cooperation in the agricultural means of production has gone from zero to flourishing, said Li.
In 1991, China and ASEAN established dialogue relations, which were later upgraded to a comprehensive dialogue partnership in 1996. In 2002, China and ASEAN signed a Framework Agreement on Comprehensive Economic Cooperation between China and ASEAN, announcing intentions to implement the CAFTA and later in 2015 the CAFTA was upgraded to bring more convenience for promoting bilateral trade. Moreover, the Asian Infrastructure Investment Bank (AIIB) established by China, with all the ASEAN countries as its founding member states, formally opened its doors for capacity product cooperation, the establishment of various industrial parks, and the construction of railways between China and Thailand, and China and Laos.
“Thus, the above-mentioned all provide more opportunities for agricultural enterprises to export their products bilaterally and at the same time bring in what they need,” said Li, adding that Laos’ potassium fertilizer brought into China is a good example. Lao is endowed with potash ore that has attracted ten foreign enterprises to explore; nine of them are Chinese companies.
More importantly, China has already made the agricultural means of production a market-oriented industry, which affords the industry greater added-value through green means. Now most ASEAN countries are promoting industrialization, urbanization and agricultural modernization.
“It means that bilateral cooperation will turn to focus on high-end technologies and exchanges of development thoughts and experiences, instead of simple trades of agricultural products,” Li said.
Importance of Industrial Parks
According to Li’s view, China’s rural land circulation helps to release the rural labor force in line with quickly making China’s agricultural production more specialized, large-scale and modernized and accelerating the socialization of production services. Under this background, some large Chinese agricultural business operators would like to bring in more advanced technologies and, at the same time, they are more willing to go global. Now they are especially glad to go to neighboring countries to invest into establishing modern agricultural industrial parks.
“This becomes a new way to broaden China-ASEAN cooperation in the whole agricultural industry, and surely cooperation in the field of the agricultural means of production will be included,” Li said.
Now, Guangxi province has built such parks with Brunei since 2014. Hunan province has worked together with Laos to build parks principally focusing on the rubber industry and has also built industrial parks with Thailand.
Thailand is home to many agricultural resources including rubber, rice, orchid and cassava that are also important agricultural ingredients for deep processing. Now lots of Cantonese businessmen are keen on these resources and some of them have already gone there to seek their fortune.
Li added that the discrepancy and complementarity in China and ASEAN agricultural developments provide the basis for bilateral cooperation. By investing into ASEAN markets of the agricultural means of production, Chinese agricultural operators could bring more high-quality agricultural raw materials in to better the quality and enhance the added-value of processing agricultural products, and finally extend the industrial chain to better satisfy Chinese consumers’ needs and make themselves act more competitively in the world market.
Smart Development Stand for Future
Discussing the future development tendency of this industry, Li highlighted that during the “Internet Plus” epoch, combining it with e-business is a must.
“In fact, developing e-business is not a pipe dream for China or its ASEAN counterparts, especially for China. China has large e-business enterprises like Alibaba, JD.com, GXYJ.com, whose business branches have extend into many sectors of the agricultural industry,” Li said, adding that this helps Chinese agricultural e-business develop quickly and steadily, going aboard to meet with ASEAN businesses to make cross-border agricultural e-business boom together.
“In this way, operators related to each sect of this industrial chain will finally gain real benefits,” said Li.
Finally, Li mentioned that since “smart” has been a key word today, developing big data is also favored by operators.
Now, emerging agricultural companies in China and ASEAN are seeking support from big data related to soil, climate, etc., to fix planting and production plans and help planters to follow a path of sustainable development.