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Biotech Industry Worried As China Moves to Restrict GE Imports

Biotech Industry Worried As
China Moves to Restrict GE
Imports

January 22, 2002
------------------------------------------------------------------------

China Using Technical Barriers To Protect Agricultural Market

Jan. 22

BEIJING -- China plans to use technical and scientific barriers to protect
its local agricultural sector, state run media reported Tuesday, citing a
Ministry of Agriculture official.

The report suggests that despite China's entry into the World Trade
Organization last month, commodity importers will still face substantial
barriers while attempting to crack the mainland market.

The remarks by a ministry official to the state-run Business Weekly also
appear to confirm suspicions that new import rules for genetically modified
organisms, or GMOs, were introduced to help push up local soybean prices.

Tang Yanli, a senior expert with the agriculture ministry's Information
Center, said technical barriers will become increasingly important after
China's entry into the international rules-based trading system.

Uncertainty about changes to regulations on GMOs have already disrupted the
$1 billion annual soybean trade between China and the U.S.

After months of confusion, Beijing eventually issued new guidelines which
require importers to acquire safety certificates and label GMO products
before being able to ship them to China.

Traders suspect China introduced the new rules to frustrate foreign
competition. Tang's comments appear to confirm those suspicions.

"It will cost traders more and take them longer to get GMO products labeled,
obtain safety certificates, approval documents and pay quarantine fees," she
said. "Thus it will bring about a wider price gap between the GMO and
non-GMO products, which is presently about 15% to 20%."

Tang predicted that imports of GMO products to China will fall this year due
to the new added layer of bureaucracy facing importers.

"Soybean prices on the domestic market might pick up between April and June,
as imports are likely to fall after the implementation of the new rules on
Mar. 20," she said.

-By Owen Brown, Dow Jones Newswires; 8610 6588-5848; owen.brown@dowjones.com


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