China’s New Farm Subsidies
By Fred Gale, Bryan Lohmar, and Francis Tuan
Economic Research Service, United States Department of Agriculture
Outlook Report No. (WRS0501) 16 pp, February 2005

In 2004, China entered a new era in its approach to agricultural policy, as it began to subsidize rather than tax agriculture. China introduced direct subsidies to farmers, began to phase out its centuries-old agricultural tax, subsidized seed and machinery purchases, and increased spending on rural infrastructure. The new policies reflect China's new view of agriculture as a sector needing a helping hand. The subsidies are targeted at grain producers, but they do not provide strong incentives to increase grain production.

REport in PDF format: http://www.ers.usda.gov/publications/WRS0501/WRS0501.pdf