Tuesday, May 16, 2006

Chopstick economics

The Globe and Mail reports that China is imposing an export tax on chopsticks. If the report is correct, the Chinese government is worried about deforestation, and chopstick exports to Japan are seen as a major cause:

The move is hitting hard at the Japanese, who go through a tremendous 25 billion sets of wooden chopsticks a year: about 200 pairs per person. Some 97 per cent of them come from China.

It's a stange story since the Chinese use chopsticks as well and there are a whole lot more Chinese than Japanese. If China's forests are suffering from deforestation then it's reasonable to assume that stumpage fees in China are too low, or that property rights in private forests aren't sufficiently secure.

It may make more sense for a country like China, with relatively few forests, to import from its neighbours. Russia has lots of wood. Thailand, Laos, Vietnam, and Cambodia have lots of bamboo. Increased prices for Chinese lumber would encourage imports and lead to less deforestation.

So if export duties on chopsticks aren't addressing the real problem, what are the Chinese officials thinking? Could it be that the long-standing animosity towards Japan is fueling a sort of chopstick nationalism? Do the Chinese think of chopsticks in the same way that Canadians think of water?

7 comments:

Anonymous said...

I recently read about similar controls on the domestic chop stick market. I think it was an article in The Economist. They really do seem to be conserned about excess loss of forrests due to chop stick production.

If this continues, the consumers will be encouraged to use re-usable chop sticks made out of other materials.

Anonymous said...

I have that Economist at home, under my coffee table. If I remember, I'll bring in a summary.

Ami Ganguli said...

Stryker: That would be great. I'll add it to the post if you can bring it.

... Ami.

Anonymous said...

The Chinese have also instituted a tax on disposable chopsticks consumed domestically. This export tax is at least consistent with that.

Anonymous said...

Couldn't find the article. But it is as Indy said. I was under the impression that the tax was high enough to really put a pinch on families that are using disposable chopsticks, which the article claimed was most of them (iir).

Ami Ganguli said...

Interesting guys, thanks.

I guess I should know better than to think that Chinese policy makers are irrational.

Of course, I still think that taxing the wood itself would be better than taxing the end-product.

... Ami.

Anonymous said...

Ami,
That would be better, but they want to preferentially tax consumable goods. They don't want to hurt their furnature business at the same time. They are trying to change the culture (just a little bit more) away from consumption. Hmmm... Imagine if that were tried here?