Study On Barriers And Potentials Of Agricultural Trade Of The Cross-Strait And The Breakthrough Path

The overall economic and trade exchanges and cooperation have become increasingly frequent and close of the Cross-strait in spite of the economic and trading relations were impacted by the political situation since30years after the Mainland’s reforming and opening. Especially in recent years, the two sides resumed institutionalized consultations on the basis of the "1992Consensus", and basically realized the two-way "Three Links" of the Cross-strait. The Economic Cooperation Framework Agreement (ECFA) injected more new momentum to the Cross-strait economic and trading cooperation. Obviously the trading plays an increasingly important role as a link of the Cross-strait economic cooperation. It is not only an economic issue to deal with the problems of agricultural trading of the Cross-strait but also a political issue. Scholars have also launched fruitful researches about this. However, what are the main factors for the volatility of economic growth of the Cross-strait agricultural trade? How is the potential for the agricultural trading of the Cross-strait? What are the factors restricting? How should the two sides break through barriers and explore potentials to the agricultural trading of the Cross-strait? The existing literatures do not give a clear answer to these important issues.This article reveals the major constraints affecting the Cross-strait agricultural trading and estimates the potential through the collecting and reorganizing of literatures and logical reasoning as well as measurement analysis, the results show that the agricultural trading of the Cross-strait is promising. And how to build the integration mechanisms of the industrial chain and break through the barriers to trade are the keys to further take advantage of and explore the potential. This article mainly studies the three core issues:(1) what are the main factors for the volatility of economic growth of the Cross-strait agricultural trade?(2) How is the potential for the agricultural trading of the Cross-strait? What are the factors restricting?(3) How to select and break through the barriers of agricultural trading of the Cross-strait so as to enhance the trading level?Specifically, this study mainly comes to the following three conclusions: (1) The factors affecting the growth of the agricultural trading of the Cross-strait are different in different periods. From the view of the Mainland’s motive to increase the export of agricultural products to Taiwan, the trade growth was mainly due to the contribution of export competitiveness before the financial crisis of2008; after the financial crisis, the export growth of the Mainland’s agricultural products to Taiwan mainly relied on the effect of import demand, especially the demand for economies of scale; the effects of export competitiveness and the contribution of structural cross effects are negative. To increase the export competitiveness of the Mainland agricultural products and improve the structure of exported products is the key to promote the Mainland export of agricultural products to Taiwan. From the view of Taiwan’s motive to increase the export of agricultural products to the Mainland, the structural cross effects was the main factor to promote Taiwan’s exports of agricultural products to the Mainland before the accession to the WTO. After accession to the WTO, the Mainland’s demands for imports of agricultural products was released and the contribution to the effects of structural cross share declined, but was still higher than20%, which indicated that Taiwan’s agricultural products were still able to adapt to the needs of the adjustments of the Mainland’s imports of agricultural products; the contribution of export competitiveness effect declined slightly in three period, but at about30%respectively.(2) The Mainland’s export of agricultural products to Taiwan not only depends on the needs of Taiwan, but also subjects to the Mainland’s supply capacity. The main constraints of Taiwan’s export to the Mainland are the Mainland’s demands and self-regulating capacity. Further studies showed that Taiwan’s export of agricultural products mainly depends on the demands of importing regions including the agricultural added value of importing regions, the income level of per capita and the distance between importing and exporting regions. Taiwan’s import of agricultural products mainly depends on the supply capacity of the source, the distance between importing and exporting regions and consumption demand. The Mainland provides preferential policies to import products from Taiwan, while Taiwan may set up barriers to the importing of agricultural products from the Mainland. Taiwan prefers pro-American policy on the trading of agricultural products; the trade volume between Taiwan and APEC members is significantly higher than that and non-APEC members. Overall, the potential of agricultural trading of the Cross-strait can be developed, especially the potential of the Mainland’s exports to Taiwan which could be equivalent to1.75times of the actual trade volume in2010.(3) The economic and trade cooperation mechanism of the Cross-strait is not yet mature and facing all kinds of political, institutional and the conflict conditions of social and cultural values. The choice to break through the agricultural trading of the Cross-strait is to integrate the industry chain and rationalize the interests’allocation mechanism, while the establishment of the operating center with jointly investment, benefit and risks-share of the Cross-strait is a viable solution. The joint operating center of agricultural products of the Cross-strait should be equipped with five sections such as the agricultural exhibition and trade section, the financial services section, agricultural science and technology service section, logistics services section and agricultural deep processing section which are all run with a good environment such as enterprise business, market-oriented operation and risk and profit sharing. The comprehensive experimental zone in Pingtan has the advantage of good location, infrastructure, matching policy and agricultural trading and economic cooperation experience of the Cross-strait, so it is the preferred choice of the joint operating center of the Cross-strait. The smooth running of the joint operating center of the Cross-strait needs the strong support from the government, for example, government’s consultations of agricultural trade issues, the planning approval, tax and capital policy etc.The first conclusion is mainly to indicate the contribution level of the competitive effect, structural effect and demand effect in the growth of agricultural trade of the Cross-strait, which is a preliminary answer to the impact and restrict of the Cross-strait agricultural trade. The second conclusion is to further analyze the constraints such as trade policy and distance and came to the judgments of agricultural trading potential of the Cross-strait. Based on the first and second conclusion, the third one is to come up with the solution to break through barriers and increase potential from the perspective of the value of industrial chain from the perspective of the value chain and take the example of Pingtan comprehensive experimental zone to propose the establishment of the operating center.Overall, this paper studies the constraints, potential and breakthrough of the agricultural trade of the Cross-strait, which might contribute to the existing researches in the following areas:firstly, the rigorous measurement verification of the constraints which affect the agricultural trade of the Cross-strait; secondly, the measurement verification verifies the fact that the potential of Cross-strait agricultural trade did not get play and the agricultural trade policies of the Taiwan authorities is an important factor to hinder the Cross-strait agricultural trade; finally, this article analyzes the path to break through the barriers and enhance the level of trade from the perspective of the interests of the industry chain, and came up with the thought of the establishment of the operating center which is a new path and a blueprint for the development of the agricultural trading and even cooperation of the Cross-strait.