Look back of the agricultural counsellors on 50 years of diplomatic relations between China and Netherlands (part 1)
18 May 2022 is the date marking the 50th anniversary of the diplomatic relations between the governments of the People’s Republic of China and the Kingdom of the Netherlands. To commemorate what happened in 50 years agricultural ties, Ina Enting, Director NAFTC, went to the Embassy of the Kingdom of the Netherlands in Beijing to meet with the Dutch agricultural counsellors: Wouter Verhey and Karel van Bommel. An interesting discussion arose about past, present and future agricultural interests between the Netherlands and China. This is the first report.
“Let’s start with a retrospective on the past 50 years” Ina Enting opened the interview. Both Karel van Bommel and Wouter Verhey were keen to say that “the relationship between China and the Netherlands is much older than 50 years”. Since the prosperous 1600s and 1700s the two countries have maintained a trade relationship. Tea, silk, porcelain, furniture and other luxury goods were traded between the two countries. A relationship that lasts until now.
1972 marks a more official point on the timeline, the moment when the People’s Republic of China and the Netherlands established a balanced diplomatic relationship. It took till 1985, only 7 years after initiation of China’s reform in general and the agricultural reform in specific, before the first agricultural counsellor was stationed in Beijing. The work of the agricultural counsellors was from the start to a large extend focused on market access and trade promotion of (food) products. The initial export from the Netherlands to China was mostly milk powder. Not infant formula, but normal milk powder. For a long time, the Netherlands was by far the largest exporter of milk powder to China. “But”, Wouter says, “China was in the early times of our bilateral trade relations a net exporter of agricultural products.
Only much later, only from 2014 onwards, they became a net importer in the agricultural trade between Netherlands and China”. Tea, vegetables and fruits are some examples of their export in the early days. Still, products like garlic, mushrooms and ginger are major export products for China to Rotterdam harbour in the Netherlands.
Especially the past two decades have made the Netherlands a very prominent partner in China
Past 50 years
From 2000s onwards, the Dutch export of knowledge and technology increased, and counsellors got more work to do in that area. Especially greenhouse technology is in high demand in China. Around 60 to 70 companies in the horticultural chain now have representation in China. Wouter: “Especially the past two decades have made the Netherlands a very prominent partner in China. We are, and feel, always very welcome in China. In fact, the Chinese side is pulling very hard on the Dutch agricultural business community to work together in knowledge and technology. They see the Netherlands as an important partner in agricultural development.”
A long haul
If we talk about trade and investment, then we need to consider that “a country like China requires a long haul. If you think you can trade quickly as a company, you can't.” says Wouter. As Dutch agricultural related companies are often SMEs, they do not always have that ability. So, it has not always been a success story for the Dutch companies doing business in China. Points of attention are the company’s own IP and the after-service to the Chinese client.
It is important that a Dutch company has a local representation in China
Wouter: “One needs to register its IP separately in China, even if you don’t do business yet in China. Fortunately, Chinese IP legislation improved a lot, but it can still lead to unpleasant situations”. Karel is adding on the after service: “In addition to selling technology, a company must also pay attention to its proper use. That means training of, and knowledge exchange with, the Chinese client.” To facilitate this, it is important that a Dutch company has a local representation in China, also from the point of view of relationship management, which is so crucial in China.
Achievements in 50 years
Looking back on the past 50 years many achievements were made. Three highlights are mentioned.
Demonstration centres
If they must select a maximum of three, Wouter remembers firstly the demonstration centres: SIDAIR for dairy, SIDAC for pigs & poultry and SIDHOC for horticulture. With development aid budgets, these farms were built and taken in production in 1997 to demonstrate Dutch technology in China. The SIDAC was opened by the former Chinese Premier Wen Jiabao. It was at-that-time an example of public-private participation. But in those days the public part was still big. Nowadays it’s smaller and is the private part more in the lead. As those farms are after 25 years more than outdated, it is certainly time for a new demonstration farm being built in Anping, Hebei province: RTTC.
Dutch high-tech greenhouse technology
Maybe the SIDHOC was the steppingstone for the second highlight: the Dutch high-tech greenhouse technology for covered cultivation of vegetables, fruits and flowers brought about a shift in the horticultural chain in China. It was a turnaround in technology, from traditional clay or brick walls and plastic roofs with insulating sheets at night, to Venlo greenhouses with climate control and automation of cultivation.
Protocol for veal
The third highlight is explained by Karel who oversees market access: “These processes are generally lengthy, and not always leading to a success. It was therefore a highlight when the protocol for veal was finally signed after many years.”. But although it took a long time, the market attractiveness didn’t diminish that it was worthwhile negotiating on it for so long.
Celebration program
It should have been a year full of events for the 50-year anniversary, but it is a bit thwarted by the pandemic and the measures related to it. There is a very beautiful traveling flower exhibition through China, showcasing the 50-year logo in flowers in a square of 20 by 30 meters. It travels from Guangzhou to Chongqing to Dafeng … but for the cities of Jinan and Beijing it has been postponed. Hopefully we can enjoy it later in Beijing. Unfortunately, the business event which would take place in Shanghai had to be postponed as well. “But in all agricultural events we pay attention to the 50-year bilateral relationship” Wouter says. So come and join us at e.g. CAHE (China International Animal Husbandry Expo) in Chengdu.
Stay tuned. Tomorrow, June 26, part 2 of the interview will follow in which we will put Sino-Dutch export at value and explore how Sino-Dutch cooperation has evolved and benefitted both counties.