"CEAC Commentary" introduces news analyses andopinions in Japan on the concept of an East AsianCommunity, but they do not represent the views ofCEAC as an institution.
October 31, 2009

Accelerating Exports to Asia is the Only Way toRegenerate Japanese Agriculture
By SHINDO Eiichi
The”manifesto campaign boom” shook the Japanese politics. Points in thepolitical disputes are US-Japan Free Trade Agreement (FTA) related with theagricultural policies and the Japanese future growth strategies. Both of them would
influence seriously the Japanese local economies such as those in Hokkaido
prefecture, “a kingdom of agricultural economy” which has been in serious recession.
The nature of election campaign manifestos is indication not only of thecommitments on specific policies in the future but also of those in the past, just as
the nature of the business contracts. We could, in this context, remember the pastpolicies on the FTAs as well as the agricultural policies, which then Foreign
Minister Aso Taro had advocated as part of the Japanese novel foreign policy named"the Arc of Freedom and Prosperity," comprising such democratic prosperous
countries in the Asia-Pacific region as the United States, Australia, New Zealand,India, Japan and Korea. Under such a grandiose foreign policy, he committed andpursued the FTA policy with Australia. The FTA with Australia as it was planned
would have seriously damaged our agricultural sectors including those of Hokkaido
prefecture. It has to be pointed out that the size of cultivated land in Japan and Korea
per farming household is only about 1.5 hectares, whereas those in the U.S. andAustralia are 196 hectares and 4100 respectively. This huge difference in the size offaming lands would end up in devastating the Japanese agricultural sectors eventhose of Hokkaido area. The past commitments on trade and agricultural policies
have indicated the lack of the comprehensive strategy of public policies toregenerate our agriculture.
It is time to think over how Japan should deal with the impacts of the FTA
just concluded between the U.S. and Korea, which completely ruled out rice as thesubject of tariff free articles to protect the agricultural sector in Korea. Hence, it istime for us to regain the competitiveness in the U. S vis-à-vis Korean exported goods,
and at the same time to explore the way to regenerate agriculture in Japan, The
answer should be the dual strategies both to improve the deteriorated ratio of foodself-sufficiency, and to take advantages of the current global revolution in
information technologies and environment conservation. It is easy to promise, butdifficult to realize, the improvement of the food self-sufficiency ratio and of thedeteriorated welfare policies, so as to regain and maintain the economic growth,since the welfare policies would need the vast amount of financial revenue. The1

growth strategy would be impossible unless we make a radical shift from theconservative neoliberal policy sacrificing the weak and the social safety-nets. It
would be also impossible to turn the current food self-sufficiency ratio from 40percents, the lowest one among the developed countries, even to 50 percents, unless
we make the drastic change in the traditional policies of depending heavily on thegovernmental subsidies that Japan has adopted for the past half a century. Even inthe U.K., it took twenty years to improve the food self-sufficiency ratio from 45
percents in 1965 to over 70 percents in late 1980’s. The key ingredient for theagricultural regeneration should be to adopt the “individual household income
support system,” which the EU countries including the U.K. have adopted. Hence, it
is called the "EU formula." It certainly aims at fostering farmers by directly
subsidizing each farming household based on the differences between the retailprices and the farms production costs against the imported agricultural goods.
In this respect, it is vitally important for the Japanese political parties either
JDP or LDP to leave off the rice acreage reduction policy which has resulted inenormous increase in abandoned lands of cultivation. Instead, we should take thefirm policy to stimulate the agriculture through the “individual household income
support system.” The current campaign manifestos of both the ruling party and theopposition remain fixed to a narrowly defined egocentric “one-country-approach.”
They have been so obsessed with the idea of the outmoded mythology of the Cold
War centering on the U.S. -Japan alliance, using the semantics of the "diplomaticcontinuity.” As a result, Japan has lost many chances to lead and coexist with Asia,
which have been the driving forces of the world economy. We should take thestrategy to expand export of our value-added agricultural products to themega-market of rising and affluent East Asia. It will open up a window ofopportunity to regenerate the Japanese agriculture. Hokkaido, “a kingdom ofagricultural economy,” with the comparatively large size of the farming land as theone in EU countries, would play a central role in initiating and pursuing this strategy
through applying the edge of the information technology to the food industry sector.
It is vital to enhance the added values of the agricultural products, to brand andcommercialize them in broader affluent markets in Asia. The current agricultural
sector is not the primary industry in a traditional sense any more. It has become
so-called the “sixth industrial sector” multiplying both the second and the third ones
through their closer cooperation with business, industrial and academic circles.
Hokkaido would certainly contribute to revitalizing the Japanese agriculture and tobuilding up the food supplying base for the regional food security regime in EastAsia.
Regenerating the agriculture would also be one of the main vehicles toreduce the carbon dioxide, marking for strengthening the current environmental
revolutionary movements through absorption of it by forests. These ecological2policies were agreed and declared at the Hokkaido Toyako Summit in June 2008 andsince then have been gradually implemented. Now we should promote moreaggressively an East Asian community building with the emerging food andecological security regime in East Asia and put forward a bolder strategy ofstrengthening the cooperative ties with Asia in these agricultural and environmental
industry sectors as well. For the past 20 years, while the ratio of total amount ofJapanese trade with the U.S. decreased from 27.4 to 13.7 percents, the one with
China increased dramatically from 3.5 to 20.4 percents and the one with Asia makes
up 48.8 and the one with Eurasia 73.9 percents respectively. This new reality ofdramatic changes of global balance of power and trade indicates us the ways toregenerate Japan's economy and agriculture through our much closer ties with Asiannations.
(This is the English translation of an article written by Dr. SHINDO Eiichi, Professor
Emeritus of Tsukuba University and Vice President of CEAC, which originally appearedon the BBS “Hyakka-Somei” of CEAC on September 9, 2009.)

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