Agrarian Crisis, WTO Entry, and Institutional Change in Rural China

Abstract

The far-reaching commitments that China has made entering the World Trade Organization (WTO) pose major challenges to the country`s fragile agricultural sector. These commitments are highly controversial and have sparked a heated debate over their potential impact on Chinese farmers. Tariff reductions, minimum access opportunities under the tariff-rate quota system, and the weakening of other mechanisms of state control and support are expected to bring surging imports of cheap agricultural products, which would in turn likely undermine the livelihood of large numbers of farmers and lead to high dislocation costs. A sharp fall in farmer income and extensive structural changes in the agricultural sector could exacerbate the ongoing agrarian crisis in China known as the ”san-nong wenti”-difficulties facing agriculture, rural areas, and peasants. This development, if it occurs, will have serious implications for state-peasant relations and the institutions governance in China`s rural areas.