With the deeper Chinese reforming and opening up, not only the amount of foreign capital in Agriculture grows rapidly, but also its usage and scope expands. However, at the same time phenomena can’t be ignored that Agriculture uses a small amount of foreign capital and structure is not reasonable.
It’s said that by the end of 2005, Chinese agriculture had used FDI amount in contract of over 32.9 billion USD, covering all the provinces, cities and autonomous regions in China and all aspects of agriculture, forestry, water resources, livestock agriculture and fishery.
Officials in Department of International Co-operation, Ministry of Agriculture said Chinese agriculture using foreign capital fills the gap of shortage of domestic capital used in it. Foreign advanced technologies and equipment were introduced into China, as well as qualified varieties and advanced management, which promotes the development of the produce processing industry, levels up the industrial management of agriculture and accelerates the reform in rural areas and agriculture.
Officials in Ministry of Agriculture said in the past few years, although foreign capital used in Chinese agriculture has grown up fast, it should be noticed that agriculture uses a small amount of foreign capital and structure is not reasonable. Foreign capital polices in agriculture need improving in a further step, so does the foreign capital environment. Risk protection system needs consummated.
According to the statistics, foreign capital used in agriculture accounts for less than 4% of total foreign capital used in China. By the end of April 2005, agricultural FDI amount in contract only had accounted for 1.93% of total FDI amount. There is also imbalance when it comes to the FDI distribution in agriculture. About 90% is invested in east China.
Compared with the past, at present foreigners have new motives to invest in Chinese agriculture. Multinational enterprises start directly investing in the producing process of Chinese agriculture, which breaks the pattern where they focused on investing in the processing and sale sector of Chinese agriculture. The new trend of changing from salesmen to farmers indicates great impacts on Chinese traditional cultivating and organizing patterns.
Japanese top brewer Asahi along with Itochu Corporation and Sumitomo rent 86.7 hectare land in Laiyang Shangdong Province, planning to cultivate cows and build up greenhouses using organic farming. The Chinese part offered 33.3 hectare land for the diary farm, exempted them from three year rent, built up power stations and paved the way to the field. Japanese part was charged for other land rent charges of 12,000 Yuan per hectare every year for the first five years. Afterwards the charges will be increased by 3,000 Yuan every five years. The contract term is 20 years. Seto, president of Asahi, expressed many times that after the success of the prototype, they will “colon” as many as 20 to 30 such projects in China.
Heng River Fruit, Macao mainly sold fruits in Mainland. Since March 2003, it has changed from selling to growing. It built a 6,700 hectare citrus production base in Jiangjin, Chongqing City. It uses the operational pattern of the company provides seeds and technologies, the association of fruit farmers participates in management, farmers cultivate fruits and the company purchases.
French Vivendi Universal is one of the global 500 companies. Its branch Connor Orange Juice is one of the best in the global beverage industry. Zhongxian County in Chongqing City is one of the three regions in the world which are optimum for growing citrus. In 1997 Vivendi Universal started building an equity joint citrus orchard with farmers in Zhongxian County. Only a few years later the investment reached up to 600 million Yuan (Chinese investment and farmers’ investment and labor included), including a 10,000 hectare orchard base and a world leading technology center.
[Origin：www.xinhuanet.com，www.chinafiw.com]
