Farming future falters
Agriculture lobby still powerful politically despite shrinking economic role
Japan’s desire to protect its agricultural industry has been a serious stumbling block when negotiating free trade agreements.
JJapan’s agricultural industry is steadily dying, despite the protection it now receives, and in the foreseeable future it is conceivable there will be nothing substantial left to shield.
apan’s compulsion to protect its politically influential and culturally iconic agricultural sector is always a serious stumbling block when Tokyo attempts to negotiate free trade agreements.
So it was to be expected that protests and intense lobbying from Japan’s highly protected farming and fishing industries would punctuate the run- up to Friday’s announcement by Prime Minister Shinzo Abe that his government will join the 11 countries already negotiating the free trade agreement known as the Trans- Pacific Partnership ( TPP).
Abe, who has made Japan’s economic revival the centrepiece of his second term as prime minister, cloaked his decision with a sense of urgency.
“This is the last chance,” he said on Friday. “If we miss this opportunity, it would immediately mean that we would be left out of setting global regulations.”
Last week at a meeting in Singapore, representatives of the 11 countries — the United States, Canada, Australia, Mexico, New Zealand, Chile, Peru, Vietnam, Malaysia, Brunei and Singapore — completed the 16th round of talks they have held in the past two years.
They have mapped out agreements on 21 trade and service areas, but have not published details.
The aim is to complete the negotiations by the end of this year, so the Japanese government is going to have to move fast to press its case to allow existing protective tariffs on rice, pork, beef, wheat, dairy products and sugar to continue.
The timing is especially tight because Japan needs to get bilateral agreements from all 11 members of the TPP in order to be able to join the talks. It is unlikely this can be completed before July.
But Japan is not alone in wanting national exemptions to what was originally envisaged as a blanket free trade ageement.
The U. S. also is under pressure from domestic dairy and sugar producers not to open their markets to additional imports.
Canada, too, wants to maintain the current protective policies for domestic dairy, chicken and egg producers, euphemistically called a “supply management” system.
The U. S. is also concerned about intellectual property copyright, especially in the biotechnology and pharmaceutical sectors.
The American textile industry, which has already seen jobs slip from 700,000 a decade ago to about 238,000 today, fears the TPP agreement will further expose their market to Vietnam, now one of the world’s largest clothing exporters.
Japanese officials reckon membership of the TPP will add about 0.66 per cent, or the equivalent of about $ 314 billion, to the Japanese economy.
However, if all Japan’s current protective tariffs on the farm, fisheries and forest industries are abolished, those sectors could lose an almost equal amount.
Rural constituencies in Japan are highly influential, especially for Abe’s governing Liberal Democratic Party, because they have much smaller populations than urban ridings and are far more numerous than the urban- rural split in Japan warrants.
But there seems to be a tipping point approaching. Japan’s agricultural industry is steadily dying, despite the protection it now receives, and in the foreseeable future it is conceivable there will be nothing substantial left to shield.
Movement to the cities and a shrinking birthrate means that there are now only 2.6 million farmers among Japan’s 128 million people, according to the Agriculture, Forestry and Fisheries Ministry.
Their average age was 65.9 in 2011, and they contributed only one per cent to Japan’s gross domestic product that year. Most have no successors to take over their farms.
Even so, Japan’s high- quality rice is a source of great national pride and cultural passion.
Abe’s negotiators are likely to cling to protection of Japan’s rice production even as they give way on other sectors, which they are bound to have to do if they want to join the TPP agreement.
The 11 countries now involved in the TPP negotiations represent 650 million people, and their combined gross domestic products are more than $ 20 trillion.
What is now the TPP started in 2005 as a free- trade agreement between Brunei, Chile,
New Zealand and Singapore.
The U. S. joined the group in 2008 and swiftly assumed the leadership. And because the TPP talks do not include China, the partnership is often portrayed as part of U. S. President Barack Obama’s “pivot” toward American emphasis on Asia in order to counter or moderate the growing influence of Beijing.
But the TPP is entering an already crowded market.
At last September’s annual summit of the 10 countries in the Association of Southeast Asian Nations ( ASEAN), it was decided to start expanded free trade talks with six regional partners to draw up what is being called the Regional Comprehensive Economic Partnership ( RCEP).
ASEAN already has free trade agreements with the six — China, Japan, Australia, India, South Korea and New Zealand — and the RCEP expansion of these agreements was called “more realistic and feasible” than the TPP.