Cooperating in a quickly changing China

Agricultural experts are working in the economic departments of fifty Dutch embassies. In China, Nynke Runia was until recently responsible for veterinary and phytosanitary affairs. Henk Stigter is her successor. 

A conversation about the opportunities, challenges and content of this job in a lively environment. 

China is the largest export market for Dutch agricultural products outside of the EU. The Netherlands is in second place on the world list regarding the export of agricultural products. For these two powerful players, there is ample room for play on the international playing field, and on behalf of the Netherlands, the Beijing Agriculture Council is hard at work for that. 

Due to the large market and demand for a large variety of agricultural products in China, this is an important market to work on. Runia indicates the Netherlands has a strong position in agriculture. “We are strong in agricultural innovations and have much technological knowledge. In addition, we also have internationally well-known research institutes in this field, such as the WUR (Wageningen University & Research).”

Both confirm developments are going quickly in China. “China is a world player in the field of inspection and analyses techniques by now. I recently visited a laboratory for food safety where they use hypermodern technology. They have amply made that technological catch-up effort,” Stigter says.

Gaining market access is a long-winded process. “We are trying to open up the market, and are especially keen to keep the market open, for animal and natural products. Keeping the market open is very important, regulations are changing and becoming stricter and more complex all the time. For example, new requirements have now been proposed to guarantee food safety. This is because of the severe food scandals in China. Consumers have lost faith in local products because of that,” Runia explains. However, that offers opportunities for Dutch business, which is capable of producing very safe food, such as baby milk powder.

It can also be seen, however, that rules meant to guarantee food safety limit trade. For example, the process to gain access for a certain product on the Chinese market. In the past, a protocol was agreed to, and based on that, a certain product would gain market access. Nowadays, besides the protocol, a separate registration process has to occur for each company that wants to export products. And in certain cases, for dairy products for instance, the product also has to be registered separately. 

According to Runia, these are things that make doing business in China challenging. “Our negotiations are interesting, but also complex, and sometimes they take years. You have to work carefully with these types of long-lasting processes. It’s essential to build trust regarding the Dutch system. The saying – trust is hard to gain but easy to lose – is very true in this case.”

Stigter mentions that this trust has already been gained in large measure. “You can see the difference in the time it takes to negotiate about market access for products. It took more than six years before pears could be exported, but for bell peppers it only took three years, even though it was seen as a high-risk product. The trust in the Dutch system is crucial, both veterinary and phytosanitary. This can also be built on by flying Chinese delegations with experts to the Netherlands annually, to show them how we work. In the end, trust is the basis on which we are able to trade with each other.”

Runia emphasises that the Netherlands is the asking party in the relationship with China. This is because China negotiates bilaterally per country about market access. For the export from China, the country negotiates with the EU as representative of the 28 member countries. 

Both emphasise that successes are often the result of years of preparation. Runia: “We are now harvesting what we sowed years before. Recent successes are, among other things, access for pork and retaining the dairy market. Because of the registration obligation, more than 80 companies had to be registered again, and it was important that this happened as efficiently as possible. This is an incredibly important market for the Netherlands. The proper conduct of such a process requires close cooperation between government and industry organisations.”

Stigter says these strong mutual relations are characteristic of the Dutch side. “A connection between embassies, the ministry and business is one of our strongest points. In these cases, one party cannot do without the other, and that close cooperation between these parties is something the Netherlands is well-known for.”