Agriculture
The region maintains a strong agricultural focus. Agriculture is restricted to the few upland plains, open valleys, and terraced hillsides. Level land for agriculture is extremely scarce and only about 5 percent of the province is under cultivation. Rice is the main crop; corn, barley, wheat, rapeseed, sweet potatoes, soybeans (as a food crop), tea, sugarcane, tobacco, and cotton are also grown. On the steep slopes in the west livestock is raised and timber, a valuable resource, is cut (teak in the southwest).
Tobacco is the main (export) product and makes up a big part of the provincial GDP. Furthermore, Yunnan has a strong competitive potential in the fruit and vegetable industries, especially in low value-added commodities such as fresh and dried vegetables and fresh apples.
Yunnan is one of the regions in the world with the most abundant resources of wild edible mushrooms. In China, there are 938 kinds of edible mushrooms, and over 800 varieties can be found in Yunnan. In 2004, around 7,744 tons of wild edible mushrooms were exported, making up for 70% of the total export of this product in China. The so-called 'pine mushroom' is the main product in Yunnan and is exported to Japan in large quantities.
Another interesting industry with a clear growth potential is the coffee sector. Yunnan is currently China's most important producer of Arabica coffee. Besides the export of roasted coffee, coffee-related products such as extracts, essences and substitutes may be promising products. Yunnan is the birthplace of tea. Still, ancient tea trees can be found in Yunnan of which tealeaves are processed. Tea is becoming an important export product. Especially in the US and Japan the demand is growing.
Due to China's growing consumption of dairy products (a trend heavily supported by the national government), Yunnan's dairy industry is also developing more rapidly and receiving large subsidies from the government develop a competitive edge in Southwest China, but is also aiming to export to its ASEAN neighbors.
Then last but not least, a growing sector, heavily supported by the local government is the horticultural sector. The flower industry in Yunnan province started to develop towards the end of the 1980s. Currently, Yunnan is the most important province nationwide in the field of flower growing. Yunnan province accounts for 50% of China's total cut flower production. The size of the planting area for cut flowers in Yunnan province amounts to 4000 hectares. In 2003, the output totaled 2.3 billion stems. In 2002 the flower industry in Yunnan had a total output of RMB 3.4 billion. Export amounted to USD 18 million. Apart from sales on the domestic market, Yunnan also exports to a number of foreign countries and regions such as Japan, Korea, Hong Kong, Thailand and Singapore.
The rapid developments in this field soon attracted the attention of Dutch horticultural companies and Dutch investments in flower related projects and businesses are steadily growing.
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