Situation of China's biotechnology industry

Although nearly a quarter of the world's population lives in China, they only live on 7% of the world's arable land (2002). In addition, there has been continuous loss of land in China due to erosion, salt production, desertification and urbanization. This loss of land has been at an alarming level, estimated at about 300,000 hectares per year (2003). This poses risks of serious social problems such as hunger and lack of food that are becoming local, pollution and soil degradation. The Chinese government views agricultural biotechnology as a tool to: improve the nation's food, increase agricultural productivity, increase farmers' incomes, promote sustainable development and improve Competitive position in the international market. (Huang et al., 2001) Advanced agricultural technologies such as biotechnology will become extremely important in the issue of food security in China (Kowalski, 2003). In response, the government has created significant resources for this sector and actively promoted the development of this industry since the mid-1980s. (Huang et al., 2001)

The biotechnology industry in China has achieved scientific success and has grown to a considerable extent but is still almost supported by the government. Success has led to a rapid increase in financial support in recent years. In the second half of the 1990s, biotechnology has more than doubled from about $ 40 million to $ 112 million a year. The Chinese government has promised to increase the research budget to 400% within 5 years from 2002-2007

Although China is a developing country, the total expenditure on agricultural research and development is estimated at around 10% of global public spending. There are currently nearly 400 government-funded major biotechnology laboratories and more than 20,000 technical and research workers in the industry (2002).

The research effort has brought many genetically modified varieties that have been field tested, have been cleaned to the environment and have been put into commercial production. Genetic modification has many goals (or combination of goals): insect resistance, fungal resistance to virus, virus resistance, salt tolerance, drought tolerance, nutrient-rich properties good quality and increased production (2002). China has the world's fourth largest transgenic commercial crop area behind the US, Canada and Argentina. China is the first country to grow commercially transgenic crops - that is tobacco. After planting 1.6 million hectares of genetically modified tobacco plants in 1996, China stopped growing genetically modified tobacco due to concerns that tobacco processors, mostly from the US, would ban China from importing cigarettes. because they are genetically modified. (1999)

6 crops have been licensed for commercial production. Two licenses are given to cotton varieties with different insect resistance. In 2000, genetically modified cotton was planted with an area of ​​700,000 hectares (2001). Two other licenses were given to tomato varieties, one genetically modified to slow ripening and the other to be antiviral. Ornamental tobacco plants that change color and anti-virus sweet pepper are also licensed. The Mosanto Group, based in the US, is the only foreign company granted a license for genetically modified cotton. (2002)

The use of non-agricultural biotechnology accounts for a smaller portion of this industry than agricultural biotechnology but it is an important part of the government's plan to address some of the most serious problems. of China. In total, 18 biopharmaceuticals have been commercialized and another 30 are being tested clinically. China has also made progress in developing bio-pesticides (2001). China has also developed genetically modified carp (abundant aquatic species in China) that grows 42% faster than non-transgenic carp.

The business of biotech products is becoming increasingly important. From January to April 2003, biotech imports reached US $ 36 million. During this same period, biotech exports reached US $ 60 million. In April 2003, biotech imports fell by 43%, partly due to seasonal factors and also due to changes in regulations and instability caused by these changes.

However, in 4 months from January 2003 to the end of April 2003, imports increased 6.9% compared to the previous 4 months. Exports grow stronger. (Ministry of Trade, 2003). Only imports of soybeans from the US with more than 70% of genetically modified soybeans reach $ 1 billion a year. This is the largest and only soybean import market of the US. China's most important GMO export product is cotton - 51% genetically modified.

Biotechnology policy of China

The Chinese government's biotechnology policy is an important factor in encouraging both domestic and international private production, but, until now, policy is still conflicting, ambiguous and lack of clarity especially for international companies.

While the Chinese government provides substantial financial support to the biotechnology industry and declares the benefits that biotechnology will bring to society, when it comes to regulation, commitment is less likely. Decisive and increasingly unclear. Monsanto company president in China, the only foreign company with the GMO license, said that, "(China), one push the need to speed up by funding public research and development. Biotech but one foot again kicks on the goal by regulation '. The lack of clear and consistent guidance from the government has created an extremely risky business environment for those who wish to export genetically modified products to China or to invest in related activities. to biotechnology, including research.

In January 2002, China introduced import regulations that required labeling and quality certification for all genetically modified plants and plants imported into China for sale, production, processing or research. assist. Getting a license to import genetically modified products is a complex process that can take up to 270 days and the requirements of this process can be a huge trade barrier.

While imports are carefully considered, domestic producers are immune to regulatory barriers. In May 2001, the Chinese state council issued 'regulations on safety of agricultural genetically modified microorganisms'.

The general rules that underlie these new regulations include biosecurity of transgenic plants and microorganisms, as well as the risks associated with them, which should be examined on a per-field basis. Combined, by type, by line and ladder style. decision-making should be based on risk expression, biosecurity considerations should focus on scientific questions and data, experts should play an important role in the decision-making process. regulations and regulatory requirements should be consistent and clear. When assessing the safety of genetically modified crops, managers will base their regulations on several key parameters such as microbial characteristics, import characteristics and how to use them. The interaction that microorganisms will have with environmental factors and the combination of all these factors.

(Photo: Pacontrol)

Once genetically modified crops are approved and entered into the Chinese market, they may be subject to strict labeling requirements. The state government is still working to establish and clarify these requirements to apply to different types of products. The Chinese government hopes that these regulations will ensure that biotech products developed in China for domestic consumption and for international trade will not pose risks to human health and the environment. These regulations have hindered efforts to commercialize some crop varieties such as rice and corn.

In general, it seems, China began to apply increasingly strict rules to genetically modified food and food in particular. While policies that prioritize and support GMO non-food products, domestic and international food safety concerns have begun to affect regulations and government policy on genetically modified food. Some Chinese scientists argue that this cautious approach shows that the next generation of genetically modified crops including key products like rice could be consumed by billions of people around the world. and the safety of these foods is now in the hands of China.

Acceptance of biotechnology by Chinese consumers.

The acceptance of Chinese consumers' biotechnology brings with it a huge potential profit to companies that want to produce biotech products. Consumer attitudes are greatly affected by the government controlled media. An international consumer survey in 10 countries shows that China has the highest support for consumer biotechnology products among the surveyed countries, including the US, Canada, and Japan, Russia, India and 4 European countries.

Due to the state management of the media, if the government's view on biotechnology changes, consumers' attitudes will almost certainly change.

Problems are gradually being recognized in China's biotechnology industry

While the domestic biotechnology industry is becoming one of the world's major biotech professionals thanks to a large grant from the Chinese government, the industry is facing enormous challenges and There are some basic issues that need to be overcome if the industry wants to succeed. As mentioned above, almost all biotechnology programs are promoted by the Chinese government. However, the subsidy does not come without special restrictions, especially in a society where central command is a rule.

Therefore, there are many conditions associated with receiving benefits, and, in particular, determining which research will focus on which species and trait. While most biotech entrepreneurs prefer private funding sources, private sector investors are reluctant to use their sources until they know that the regulatory mechanism will give them a chance. reasonable association to recover their investment.

Another major challenge is managing the extremely complex agricultural biotechnology development efforts in China. Lack of coordination between program management and between individual researchers has contributed to unnecessary and inefficient development efforts, especially at the local level. This creates less and more expensive technological advances.

The Chinese government's lack of clarity on the future direction of the policy has made foreign governments, especially the European Union governments, extremely worried that there will not be enough publicity. concerns about establishing and enforcing regulations to ensure food safety and environmental concerns of consumers and others in the European Union. As a result, they put pressure on the Chinese government to take stricter safety standards. The Chinese government has yet to find a good balance between ensuring their products are safe, satisfying international worries and encouraging the industry to grow. If the Chinese government cannot find a balance, not only will state companies continue to receive significant subsidies but the shortage will undoubtedly discourage domestic private investors and investors. foreign investment.

While the clear support for biotech products from Chinese consumers is a huge advantage now, in the long run it is uncertain. Although limited information shows that Chinese consumers are highly aware, they also have little accurate knowledge about genetically modified foods. Because Chinese consumers have not undergone debates regarding the safety of biotechnology, their views can easily change if there is negative news in the future.

The Chinese government has adopted regulations restricting foreign investment in an effort to ensure that what they see as the essential industry of the future must be within domestic control. The price may be the loss of opportunities for technology transfer. In April 2002, China issued a "list to guide foreign investment industries." This new regulatory mechanism prohibits foreign investment in the field of 'production and development of transgenic crop seeds'. These regulations are the most restrictive regulations for the production, research and import of genetically modified microorganisms in the world. While this creates immediate profits for Chinese biotechnology because it does not face foreign competition in this profitable seed development business, they are at risk. go alone and fail. If China falls behind foreign seed suppliers, farmers can switch to smuggled seeds.

Future prospects for China's biotechnology industry

Although Chinese biotechnology is facing some big challenges, it seems that the medium-term prospects are quite good. China is going through a period where deep and widespread changes take place in the way domestic markets and international trade mechanisms work, especially in the way the government intervenes in the economy. While the same change is almost certainly beneficial to both China and its trading partners, but in the short term, the degree of uncertainty will limit the enthusiasm for investing in the Chinese market. National.

One of the most important factors for the long-term success of the biotech industry is the motivation that comes not only from having profitable opportunities, as is the case in most countries. development, but also the perception that biotechnology can help solve some of China's most pressing social problems. Because the Chinese population is constantly increasing and requires sufficient food and land resources, finding alternative means to address this issue is even more concerned. Faced with these pressures, China may pay more attention to the potential benefits of biotechnology and pay less attention to risks than developed countries.

The Chinese government must carefully consider the policy of limiting foreign investment in biotechnology because China will: Make other governments angry to the point of filing a formal complaint with the WTO. And isolating our country's biotechnology industry with advances made in other countries and can make China's biotech industry lag behind its competitors.

Thanh Van (General)