The Paper.cn:

Major grain-producing areas serve as an important anchor for ensuring national food security. However, these areas are often stuck in a long-time financial dilemma, which is the negative correlation of grain yields and the fiscal revenue. May I ask, what policies and measures have been adopted to incentivize major grain-producing areas? Thank you.

Han Wenxiu:

Major grain-producing areas play a big part in increasing grain production capacity and ensuring grain supply. China's 13 major grain-producing areas produce more than 80% of the country's total output. Meanwhile, we should also notice the poor economy and government finances of these areas, which is a prominent problem. Major grain-producing counties are often weak economically and face fiscal difficulties. This problem, if it remains unsolved, will discourage them from wanting to continue to grow grain and will affect the overall grain production and supply. This year's No. 1 central document has made targeted arrangements for this with a focus on refining the interest compensation mechanism for major grain-producing areas. 

On the one hand, we will step up support to major grain-producing counties. We will focus on further increasing rewards and subsidies to major commercial grain-producing counties that make more contributions to national food security, and cancel the matching requirements for funds used in high-standard cropland development in major grain-producing counties. We will also address the weaknesses of major grain-producing counties in their public services and launch an initiative to improve their relevant capacity. This year, trials will first be launched in four major grain-producing provinces and an autonomous region, including Jilin, Heilongjiang, Anhui, Henan, and Inner Mongolia, and then gradually be promoted in other places.

On the other hand, we will establish an interest compensation mechanism for major grain-producing areas. This year, we will strive to make solid progress in solving the long-time challenge. The No. 1 central document has proposed exploring the establishment of a trans-provincial interest compensation mechanism for grain-producing and grain-selling areas and deepening production-marketing coordination through multi-channels. At present, relevant departments are busy developing specific implementing measures. In overall consideration of factors such as grain production, circulation, and consumption in major grain-producing and grain-selling areas, a basic approach has been put forward that requires major grain-selling areas to provide a certain level of financial support for major grain-producing areas so as to deliver real gains to them through horizontal interest compensation. Also, the two sides should further expand collaboration in industries, talent, and technological services and take more solid measures to ensure major grain-producing areas won't suffer losses from growing grains. 

In terms of industrial development, we will expand and extend the industrial chain. Major grain-producing areas are endowed with abundant grain resources, yet their small-scale grain processing industry has a poor conversion rate of on-site processing. The No. 1 central document has proposed to promote the layout of agro-processing industry in major grain-producing areas, including supporting the construction of agro-processing industrial parks in major production areas of grains and other important agricultural products, supporting the development of the whole-industrial-chain processing of soybeans and other agricultural products in the northeastern region, creating food and feed industry clusters, and promoting value-added transformation on-site and in the vicinity so as to speed up our efforts to bring prosperity to major grain-producing counties and their residents.  

That concludes my brief answer. Thank you.