Trade Liberalization and Food Security: A Case Study of Taiwan using Global Food Security Index (GFSI)
Date Issued
2015
Date
2015
Author(s)
Shih, Jou-Chen
Abstract
The effect of trade liberalization (e.g., WTO, FTA, or TPP) on food security has been an important issue in policy debates. An acceptable definition and reasonable measurement of food security is indispensable for such impact assessment. In Taiwan, Korea and Japan where agriculture is traditionally highly protected, the concept of food security is almost equivalent to that of “food self-sufficiency rate”. As a result, trade liberalization with increasing agricultural imports will surely incur negative impacts on domestic agriculture and food security. To deepen the dialogue on food security, we utilized the Global Food Security Index (GFSI) which was created by the Economist Intelligence Unit (EIU) of the Economist in 2012. In contrast to “food self-sufficiency rate”, the GFSI assesses food security across three internationally designated dimensions: affordability, availability and utilization (or quality and safety). As a dynamic quantitative and qualitative benchmarking model, the GFSI was constructed from 28 unique indicators measuring drivers of food security across 109 countries, but without Taiwan. In this study, we have three specific aims to be fulfilled. The first is to calculate the Global Food Security Index (GFSI) for Taiwan and investigate the performance raking of Taiwan in the world. The second is to use the hierarchical data envelopment analysis (DEA) to recalculate the ranking of GFSI, trying to test and verify the weightings assigned are convincible or not. Importantly, the last purpose of this study is to build the time-series data of Taiwan’s GFSI and explore the relationship between Taiwan’s trade liberalization since her WTO accession in 2002 and food security status. The results of this study indicate that the GFSI of Taiwan (74.4 points) took the 24rd place (the top 20%) in the overall ranking among 110 countries in 2014. Each of the three categories ranked 26th, 25th and 27th with 80 points, 68.6 points, and 76.3 points, respectively. Furthermore, the verification results of GFSI by the hierarchical DEA are similar to the original. Using the hierarchical DEA, Taiwan took the 26th place in the overall ranking among 110 countries in 2014 in the first scenario and took the 23rd place in the second scenario instead. The United States still took the first place in the both scenarios, and Singapore which took the fifth place originally became the sixth and second one in the first scenario and second scenario respectively. Adding the theoretical models, we can greatly increase the believability of the GFSI. Although it seems that the food security performance of Taiwan is good according to the GFSI, there are still many aspects that can be improved when we compare with the performance of Singapore, such as GDP per capita and the efficiency of distribution. In this study, the annual GFSIs of Taiwan over the past 15 years were also computed to investigate the association between food security, food self-sufficiency rate, and trade liberalization. Within the past 15 years, there were significantly sharp declines in 2002 and 2008. We inferred that the main reason for the sharp declines in 2002 is the import tariff decrease resulting from Taiwan’s entry into the World Trade Organization (WTO). And for 2008, an economic recession generated by the Global Financial Crisis should be responsible for the significant decline of Taiwan’s GFSI. In general, we found that there has been a steady growth trend of Taiwan’s GFSI since 2002 although food self-sufficiency rate has been declining. In conclusions, judging from the more comprehensive measurement of food security definition, trade liberalization improves the food security status of Taiwan.
Subjects
Foos security
food self-sufficiency rate
global food security index
hierarchical DEA
agricultural trade liberalization
SDGs
Type
thesis
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