Impacts of Climate Change on Self-sufficiency of Rice in China: A CGE-Model-based Evidence with Alternative Regional Feedback Mechanisms

Abstract

Climate change would pose a direct and severe challenge to China’s rice production and self-sufficiency. Here we use Global Trade Analysis Project (GTAP) model to evaluate the impacts of climate change on the self-sufficiency of rice in China due to 2 ℃ rise in temperature, and further analyze the impact and transmission mechanisms of climate change through market and trade. Our simulation method switches different regional mechanisms in the GTAP model by employing alternative closures and scenarios. Our results suggest that the fluctuation in rice price is much larger than that of rice production. The active regional feedback mechanism has much larger effects than the passive one in assessing climate change impacts. With the passive regional feedback mechanism (Single Regional General Equilibrium, SRGE and Multi-Regional General Equilibrium with China’s shock, MRGE_C), China’s rice export would decrease by more than 8%, and import would increase by over 5%, which leads to a decrease in rice self-sufficiency by more than 0.06 percentage points. With the active regional feedback mechanism (Multi-Regional General Equilibrium with China’s shock, MRGE_W), climate change will increase China's rice export by 2.7% as rising rice exports to South Korea overweight the export decrease to other countries, concurrently, China’s rice import would decrease by 0.04%, which leads to a slight increase in rice self-sufficiency. As a whole, climate change will not severely threaten China’s rice self-sufficiency. By the decomposition analysis, climate change impacts on China’s rice self-sufficiency mainly depend on the changes in China’s domestic rice production. Interestingly, the source of China’s rice import will switch from Vietnam to Pakistan under MRGE_W, which derives from the input structure of paddy rice and rice sectors in different countries.

Keywords: climate change; rice self-sufficiency; market and trade; regional feedback mechanisms; GTAP model