Development of Agribusiness Enterprises - Asian Productivity ...

Total exports increased with the relative proportions of exported agricultural products
decreasing and industrial export increasing.
Newly Industrialized Economies (NIEs) in Asia have been promoting export-oriented
industrialization since the 1980s, and they have been successful in actively exporting their
industrial products within the region by gradually abolishing restrictions and restraining
government intervention. In addition to NIEs and the Association of South East Asian
Nations (ASEAN), China and Vietnam joined the global market economy in the latter part
of the 1980s and began exporting agricultural products and industrial goods, which was made
possible by cheap labor and active promotion of free trade.
Within a quarter of a century, countries in the region have been able to multiply their
agricultural production and satisfy the food demands of their increasing populations. The
food processing industry met the needs of the developed countries by transferring production
to local sites, and by introducing a modern technology and management systems from
developed countries. With improved socio-economic standards and changing lifestyles,
domestic demand for processed food steadily expanded. Agriculture in the region became
diversified according to conditions within and outside the region and in response to changes
in corporate activities. In addition to agricultural and livestock production, other changes
were induced in agribusiness areas. In particular, manufacturing output and markets of the
food processing industry grew. Countries became beneficiaries of foreign investments and
transfers of business management practices, enabling them to develop their food processing
industries and promote distribution or the eating-out business. While maintaining the
production of traditional foodstuffs, domestic demand for new products was also developed.
At present, there are several critical problems in the region. Competition is being
escalated with the market participation of China and Vietnam. The start of investment and
production activities in the food processing sector of those countries resulted in increased
production among agriculture-based ASEAN members and the newcomers becoming more
competitive.
The following policies and programs might be necessary for coping with globalizing
trend of the economy in the region: (a) promotion of greater cooperation for mutual benefits
between local farmers and related small and medium-size businesses; (b) establishment of a
regional framework for greater integration of production activities among countries;
(c) development of supporting and related industries; (d) development of basic social
infrastructures to keep up with economic development; (e) adequate supplies of basic food
requirements for the increasing populations in Asia; (f) development of common inspection
standards for the safety of food products; and (g) conservation of resources and effective
protection of the environment.
On the demand side, economic development has brought about diversified lifestyles
and food preferences. On the supply side, development of agribusiness products has been
accompanied by the emergence of more complex food materials, especially in types of
processed foodstuffs, and manufacturing process. Because of the diversification of resources
and technologies of the different countries, agricultural production has to expand its linkages
with related industries. A more broadly defined agribusiness is needed in order to understand
present conditions and implement comprehensive policies to deal with problems. Asia and
the Pacific is a vast region that has rich resources with much potential for possible utilization.
The region is still developing from a global point of view. It is expected to develop the
means of production division and collaboration within the region or between other regions.
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