Agriculture (which includes crop farming, fisheries, forestry, and animal husbandry) can be called a “biological industry.” Being “biological,” it is closely tied to the climate, and to water and land resources. Being an “industry,” it constitutes an important link in the overall economy. Taiwan’s agriculture sector today must deal with numerous issues, such as food security, climate change, globalization, and regional economic integration, and the factors that impact agriculture have become increasingly complex. We must adopt new thinking to redefine “agriculture,” and increase its value-added through innovation and through linking it with other economic activities and sectors. At the same time we must ensure that labor, land, and water inputs are used more efficiently, emphasize quality over quantity in the domestic market, and increase our global competitiveness and ability to penetrate foreign markets.

Let’s review 2013. The main axis of the policies adopted by the Council of Agriculture (COA) is “Agriculture of Healthfulness and Sustainability,” the core agricultural policy theme within the government’s “Golden Decade National Vision” economic policy document (finalized in 2012). In 2013 the COA: (1) continued to promote greater competitiveness and internationalization in the agriculture sector, (2) increased flexibility and effectiveness in the distribution of our resources, and (3) made progress in many specific measures such as (a) readjusting the land use structure and revitalizing use of fallow land, (b) industrialization of agricultural technology, and (c) banning slaughtering of poultry at traditional markets. Now we examine in greater detail some of the more important developments in 2013.

Major policy accomplishments and innovations in 2013 Continued progress in agro-technology

Several years ago the government launched a program to promote “Excellence in Agriculture.” In 2013 the value of production under this program was NT$135.6 billion, an increase of 45.2% over 2008 (prior to the beginning of the program). Also in 2013, the income from agro- technology transfer was NT$84.12 million, an increase of 10% over 2012. Taiwan’s vaccine development industry in particular demonstrated the attainment of international standards in 2013 when the Animal Technology Institute Taiwan (ATIT) successfully transferred a “Mycoplasma hyopneumoniae subunit vaccine for pigs” to the well-known German firm Lohmann Animal Health. Aiming to speed up the pace of industrialization and internationalization of R&D results, on January 1, 2014, the government founded the Agricultural Technology Research Institute, which will serve as an institutional bridge between research institutes and the private sector.

Diversification of the rural economy

Exports of agricultural products in 2013 totaled US$5.08 billion, an increase of over US$1 million compared to the previous year. The five products which showed the fastest growth in export value were sugar-apples (Annona squamosa), Taiwan tilapia, tea, milkfish, and Phalaenopsis orchids. In addition, further progress was made in penetrating the market in mainland China, as Taiwan sold US$920 million in agro-products to the mainland in 2013, an increase of 16.4% over 2012. Cross-strait trade in agro-products, which for Taiwan was in deficit by US$280 million in 2008, showed a steady decrease in the deficit over time, and in 2013 this trade finally turned to a surplus of US$17.08 million.

Also in 2013, the rural leisure industry had annual production value of NT$10 billion, with over 20 million visits, increases of 17.5% and 8% respectively over 2012. Especially noteworthy is that about 260,000 of those visits were by foreigners, an increase of 22%. These figures indicate great success in the internationalization and diversification of the rural economy in Taiwan.

Restructuring the cultivation system

In an effort to raise food self-sufficiency and maintain the production environment, in 2013 the COA launched the “Plan to Restructure the Cultivation System and Revitalize Farmland.” Under this plan we encourage farmers to bring land back under cultivation, or to rent it out to someone who will, in order to grow import-substitution crops, special local crops, organic crops, and crops that have high potential for export. Compared to 2011, the amount of fallow land has fallen by 88,000 hectares (-44%), and contract farming has increased by 53,000 hectares. Of 48,343 hectares of land that was left continually fallow in 2011, surveys show that 31,360 hectares have been brought back under cultivation for rice or for contract crops, meaning that 65% of that unused land has been revitalized. These are remarkable achievements.

Free Economic Pilot Zones

Under the government’s Free Economic Pilot Zones (FEPZs) initiative, the first phase of which was formally launched in August of 2013, one of the target industries to benefit will be “value- added agriculture.” The COA has mapped out value-adding strategies, which aim to link abundant foreign raw materials with Taiwan’s competitive advantages (including safe high- quality raw materials produced under contract, critical production techniques and technologies, and agricultural R&D capabilities) to promote comprehensive value-added development in this sector. We are focusing on promotion of selected industries with international market potential— including ornamental fish and peripheral products; agricultural biotechnology (such as animal vaccines); and industrial processing of crop, fisheries, and animal husbandry products. These value-added industries will not only earn money in themselves, they will also expand demand for Taiwan’s primary agricultural products.

The FEPZs are based on the idea of creating regulated zones separate from the domestic economy, with a “shop in front, factory behind” model. In the first phase they are being set up in six seaports, one airport, and the Pingtung Agricultural Biotechnology Park (PABP). They will house business operations and logistics/warehousing services, and companies may undertake simple processing in an FEPZ or subcontract out more elaborate processing work to Taiwan factories outside the FEPZs. The COA is giving top priority to the PABP. As of the end of 2013, 14 firms had received approval to move into the Park, with investments amounting to NT$1.75 billion.

Banning traditional poultry slaughtering

Based on health concerns, on May 17, 2013, the COA initiated a ban on slaughtering of poultry at traditional markets. Related measures include: (a) assisting live-poultry butchering stands to transform to alternative services; (b) reorganizing the poultry production, slaughtering, and marketing structure; and (c) strengthening enforcement of the law against illegal slaughtering operations.

The policy is aimed at preventing human contact with live poultry to minimize the possibility of the avian influenza virus infecting humans, and it also improves food hygiene and safety for all citizens. Although there was some controversy among stakeholders in the early phase of implementation, thanks to the concerted efforts of various ministries as well as municipality, county, and city governments, the policy has won widespread support. The number of indigenous chickens sent to slaughterhouses rose from an average of 86,000 per day in April of 2013 to 207,000 per day in December.

Promoting local consumption

The COA has been actively promoting “local production, local consumption.” We emphasize that domestically produced agro-products are fresher, and encourage citizens to consume more locally produced agro-products to support domestic agriculture. Aiming to increase consumption of domestic rice in particular, we have taken a number of steps, including: (i) holding information campaigns to inform the public about domestic rice, (ii) coming up with more diversified and creative rice foods, (iii) encouraging the processing and use of rice flour, and (iv) arranging presentations that bring together the mass media and manufacturers of processed rice products, (v) promoting the “Taiwan Rice” brand. This is all part of a larger effort to communicate with consumers, promote education about local farming, and work with catering services and restaurants, in order to develop the habit in young people of consuming domestic agro- products.

Coping with internationalization

Another major challenge for agriculture in Taiwan is coping with trade liberalization. Taiwan’s competitiveness in this sector is not quite up to the level of such agro-powers as Australia, New Zealand, and the USA. A top priority for the COA is to lead the way in building up a brand name for Taiwan agro-products; developing agro-industries that are high-value, high-tech, and export-oriented; leading internationalization of the rural economy; pioneering entry into global profit-making opportunities; and expanding value added for agro-products. Also, in order to achieve market differentiation from imports, we must link agricultural production with rural rejuvenation, steer production and marketing toward unique local products, and promote the idea of “local production, local consumption.” These tasks became even more urgent when President Ma Ying-jeou instructed all ministries and agencies to complete the basic preparations for entry into the Trans-Pacific Partnership (TPP)

Faced with this era of challenges and oppor- tunities, we at the COA will have to courageously innovate and change in order to cope with the changing environment for agro-industries and the rigorous tests created by circumstances. We must reinvent “agriculture” in Taiwan as a “new agricultural value chain”—by changing traditional ways of thinking, moving faster to emphasize quality and excellence, creating integrated value added through chains of value, bringing the multiplier effect into play, and promoting cross-boundary cooperation and innovation ideas.

The Council of Agriculture is committed to adapting to changing conditions, and we will seize all opportunities to transform and re-develop agriculture. With the help of all concerned parties, we will employ our limited resources, adopt pragmatic measures, bring our expert knowledge to bear on problems, strive to serve the people, and work to enable Taiwan’s agricultural sector to continue expanding and growing stronger. We want to enable our agriculture to re-invent itself as a sector that will be able to boast premium quality, local character, and international competitiveness in this new century!