Farmers’ and fishermen’s associations and irrigation associations are grass-root groups that have direct impact on the stakeholders. Because of the changed socio-economic conditions, these associations have to re-adjust and transform so that they can be efficient in their management and effective in their services and be able to re-direct themselves toward the development of diverse services for the value-added agricultural industry.

1. Improving management of farmers’ and fishermen’s associations

1. For the transformation of the farmers’ associations, the COA has revised the Farmers’ Association Act and supplementary regulations, the supervising and auditing protocols, the qualifications and reviewing processes for the new members, and the associations’ financial management procedures. The COA played an active role in supervising the associations’ 18th combined recruitment examinations, and was instrumental in combining two associations located in Dapu and Chuji townships in Chiayi County that had had difficulties in credit management. During the year, the COA also conducted 12 training classes on the associations’ general management and accounting protocol for 1,085 staff members. The COA also assisted six associations in an innovative transformation, 17 farmers’ associations in adopting new corporate identity systems, and 22 associations in developing economic services.
2. The COA conducted an annual evaluation of fishermen’s associations with regard to administration, services, finance, supply and marketing, etc. The effort was to ensure their smooth operations and to secure the fishermen’s welfare. The regulations governing the associations’ personnel management were also revised to better protected staff interests and ensure better services. Besides, training classes were held in baking, 4-H club management, and leadership skills. During the year, there were 80 trainees for these activities.
3. The COA offered NT$2.229 billion to assist the farmers in paying irrigation association membership fees and NT$500 million in aid to six irrigation associations with financial difficulties. Such aid reduced farmers’ production costs by NT$5,864 per hectare and ensured maintained the associations’ routine operations for the benefit of 1.260 million members. In addition, the COA provided funds to the Taiwan Joint Irrigation Association (TJIA) for holding staff training workshops on the improvement of association operations, and forums on the associations’ structural position, future development and re-organization.

2. Strengthening of agricultural financing system

1. The COA continued with varies supervisory and advisory measure to ensure that all agricultural financial organizations will provide excellent services. At the end of 2007 the Agricultural Bank of Taiwan (ABT) held deposits and loans of NT$392.0 billion and NT$42.3 billion, respectively. There were increases of NT$74.9 billion and NT$28.8 billion, respectively, over the previous year. As to the credit departments of all farmers' and fishermen's associations, they had the combined deposits and loans of NT$1.3573 trillion and NT$721.8 billion, respectively. The deposits decreased by NT$16.6 billion, and the loans increased by NT$59.9 billion. The non-performing loans (NPLs) were NT$45.1 billion with an NPL ratio of 6.25 percent, a reduction of NT$8.7 billion or 1.88 percent from the previous year. During 2007, the earnings totaled NT$4.535 billion, or an increase of NT$860 million. These figures clearly indicate that the centralized management of Taiwan's agricultural financing organizations is effective and producing significant outcomes.
2. During the year, a total of NT$36.0 billion was appropriated as special loans for farmers and fishermen to finance their operations. Another NT$250 million was appropriated to the Agricultural Credit Guarantee Fund to reinforce its guarantee capacity. In 2007, about 40,000 farmers and fishermen obtained NT$20.1 billion in loans. A computer-based accounting system was designed to improve agricultural loan management.
3. To improve the legal framework of agricultural financing, several regulations were revised with regard to the qualification, appointment and discharge of credit department heads risk control in the credit departments, and controls on currency transactions money laundering in the agricultural financial institutions.
4. To reduce the burden of deposit insurance premiums on the credit departments of the farmers’ and fishermen’s associations, the Financial Supervisory Commission of the Executive Yuan approved the COA’s proposal to set the deposit insurance premium lower than for other financial institutions, which saved NT$80 million in 2007. More than 200 credit department benefited from this change.
5. During the year the COA permitted four farmers’ associations to re-establish their credit operations after resolving their management problems.
6. To integrate the various financial information management systems operated by the four joint information centers of the farmers’ and fishermen’s associations and the Agricultural Bank of Taiwan, the National Agriculture, Fishery and Finance Information Center was established in the year.
7. The BSI Group (a.k.a. the British Standards Institution) accredited the online reporting systems, the management information systems, and the checking and tracking systems for operational activities at the COA’s Bureau of Agricultural Finance with the international standard ISO27001 related to information security.