CHINA-AGRICULTURE: OBOR

Following the spike in global grain prices a decade ago, Chinese officials urged agribusinesses to secure farmland overseas to fill the country's growing food deficit. China's Agriculture Ministry claims China now has 1,300 companies which have made $11.7 billion in total investments in agriculture, forestry, and fisheries in 85 countries and regions. To promote the Belt and Road Initiative, Chinese leaders have in recent weeks begun rebranding these foreign farm investments as a form of international cooperation. The strategy envisions giant agro-industrial parks, tractors and irrigation networks spreading out along the "New Silk Road" of railroads, highways and ports being built by Chinese companies to create 'new flourishing farms in the deserts, mountains, hillsides and steppes of Asia, Africa and Eastern Europe' and promote global food security, end poverty and spread environmentally friendly production methods'. Ye Xingqing, Director of an agricultural economics think tank affiliated with the State Council, wrote in June in a newspaper commentary, that agricultural investment in Belt and Road countries is needed to stabilize China's future food supply and diversify its food import sources. He wrote that sharing technology and encouraging institutional innovation will eventually produce food surpluses in these nations to address future food deficits in China and avoid risky dependence on supplies from the U.S. and other nations in the Americas and Oceania. A State Council initiative this year to develop domestic agricultural processing industries has received President Xi Jinping's endorsement. However, Chinese researchers have found that overseas farm investments have generally fallen far short of their goals, with little exported back to China. Chinese investors complain of corrupt officials, inefficient local bureaucracies and burdensome local taxes, as well as inadequate support from their own government. Chinese companies have been farming in Russia, for example, for more than 15 years, but they have only begun to send produce back to China in the last few years. The investors have complained that Russian officials impose exorbitant tariffs on equipment imported from China, refuse to issue work visas and have dragged their heels on an agreement on grain exports. In Bulgaria, a Chinese company acquired 10,000 hectares of land in an impoverished region but quickly abandoned it when it discovered the land was unproductive and its managers could not communicate with local laborers.

China's degraded environment also motivates investors to look for pristine farmland overseas.  A 2007 pollution census identified chemical fertilizer runoff and livestock manure as major sources of water pollution. China's first soil pollution survey found that 19% of farmland was contaminated with heavy metals. The pumping of irrigation water from ever-deeper wells has depleted underground aquifers and the soil has lost organic matter in many areas.







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