Scaling Up and Going Out: The Politics of Chinese Agribusiness Development

This paper investigates the politics of Chinese agribusinesses “scaling up” production domestically and “going out” to make investments globally. It addresses the following questions: What are the key drivers behind the transition from smallholder farming to industrial-scale agriculture in China? What are the domestic and global implications of this transition? The paper argues that the development of dragon head enterprises, or large-scale, agro-industrial firms, lies at the heart of China’s recent agricultural modernization efforts, that the factors driving their development are irreversible, and that US firms will face tough competition with them both within China and globally. Given the economic importance US-China agricultural relations and the two countries’ shared interest in promoting global food security, US policymakers should focus on enhancing the transparency of Chinese firms’ global activities, rather than banning Chinese investment in the US agricultural sector.