China's agricultural sector made new achievements in 2005. The thorough implementation of state policies supporting and favoring rural areas stimulated farmers' enthusiasm in production and ensured a sound development of agriculture and the rural economy.

In the year, sown areas of grain was 104.27 million hectares, an increase of 2.67 million hectares compared with that in the previous year; cotton, 5.06 million hectares, a decline of 630,000 hectares; oil-bearing crops, 14.31 million hectares, a decline of 120,000 hectares; sugar crops, 1.56 million hectares, a decrease of 10,000 hectares; and vegetables, 17.74 million hectares, an increase of 180,000 hectares.

The total output of grain was 484.01 million tons, up 14.54 million tons or 3.1 percent over the previous year. The output of cotton was 5.70 million tons, a decrease of 9.8 percent; that of oil-bearing crops was 30.78 million tons, up 0.4 percent; and that of sugar crops was 95.51 million tons, a decrease of 0.2 percent. Steady progress was made in vegetable and fruit production with optimized varieties.

Output of Major Farm Products, 2005

The total output of meat for the year reached 77.0 million tons, up 6.3 percent. Of this total, the output of beef and mutton was up 5.6 percent and 9.3 percent, respectively. The total output of aquatic products was 51.0 million tons, up 4.0 percent.

The total production of timber for the year came to 47.46 million cubic meters, a decline of 8.7 percent.

Over 1.02 million hectares of farmland were installed with effective irrigation systems, while another 1.23 million hectares of farmland were guaranteed by water-saving irrigation systems.

Abolishment of Agricultural Tax

On December 29, 2005, the 19th Meeting of the Standing Committee of the 10th National People's Congress overwhelmingly passed a resolution to abolish rural taxes beginning January 1, 2006.

Preliminary estimation shows, compared with 1999 when agricultural taxes were levied, farmers would pay 126.5 billion yuan less in taxation every year and each farmer would save 120 yuan.

In order to guarantee that rural administrative bodies could run smoothly and basic education in rural areas would not be affected after the tax cuts, the Central Government and governments at local level have promised solid financial support to rural areas. By 2005, the Central Government had allocated a total of 183 billion yuan in transfer payment to support the tax reform. As of 2006, the Central Government would provide at least 100 billion yuan every year to ensure that the policy would be implemented smoothly. Among this annual appropriation, 78 billion yuan would be allocated to local finance through transfer payment.