2009, Volume 17, Paper 2
ISSN: 1883-5675

Uncover the Causes of China’s Low Utilisation of Grain TRQ

Zhang-Yue Zhou
Xia Kang

Abstract

Since China’s accession to the WTO in late 2001, China’s utilisation of grain TRQs
(tariff-rate quotas) has been very low, being only about 12 per cent on average during 2002-08. This is in sharp contrast to anticipations of many analysts who believed that China’s grain imports would grow significantly after its WTO accession. This paper examines China’s management of grain TRQs and analyses why the grain TRQ utilisation is low. Our study shows that the primary cause for the low utilisation of the TRQ has been due to comfortable domestic supply situations, thanks to policies promoting domestic supply. Whether China’s grain TRQ usage will increase and how its grain trade policy will evolve in the future will continue to be affected by domestic grain supply and demand, and also by the outcomes of bilateral and multilateral free trade negotiations.

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