Japanese farmers were relieved Wednesday to avoid an influx of cheap imported farm products as free-trade talks under the World Trade Organization collapsed Tuesday in Geneva.
However, business leaders deplored the lost opportunity to expand market access for Japanese industrial products in developing countries.
Had WTO members struck an accord, rich countries would have been allowed to designate only 4 percent of all farm products as sensitive products to be exempted from steep tariff cuts.
Japan has sought at least 8 percent of all farm products to be exempted from sharp tariff cuts, but most member economies agreed to limit the exemption up to 6 percent, including 2 percentage points to be additionally granted in exchange for increasing the amount of low-tariff imports.
An official at an agricultural cooperative in Okinawa, where sugar cane is a main crop: “We had a sense of crisis since the negotiations developed in an extremely unfavorable way (for Japan). We appreciate to some extent the government’s response in the negotiations because it did not easily make a compromise.”
Yoshitaka Matsushita, a senior official at JA Kagoshima Prefectural Union of Agricultural Cooperatives, said he was worried about the fate of sugar cane farming on the southern islands in the prefecture.
“I was concerned that people may disappear from the islands if sugar is removed from the list of sensitive products,” he said.
Farmers in Hokkaido, a key production base for farm products protected with high tariffs, including butter and potato for starch, were also relieved at the development.
But an official at an agricultural co-op in the prefecture said farmers will need to boost cost-competitiveness as globalization in the agricultural sector is a general trend.
Agriculture, Forestry and Fisheries Minister Masatoshi Wakabayashi told a news conference in Geneva that although Japan did not face a barrage of criticism over its call to designate a higher percentage of farm products as politically sensitive, only a handful of economies sympathized with Tokyo’s position.
Meanwhile, business circles are worried that Japan could be placed in a disadvantageous position without a WTO accord under the Doha Round as Tokyo has been left behind by other rival economies, including South Korea and the United States, in promoting bilateral free-trade pacts.
Economy, Trade and Industry Minister Akira Amari said in a statement the collapse of the free-trade talks deals a severe blow to Japan.
Japanese manufacturers, particularly automakers, had hoped for cuts in tariffs on industrial products in emerging economies to sell more to those markets.
An official at a Japanese carmaker said, “It is the worst result that (the trade talks) collapsed without any schedule for resumption (of the negotiations).”
A senior official at the Japan Business Federation (Nippon Keidanren), the nation’s most powerful business lobby, said, “I’m concerned that the reliability of the WTO could be shaken by the breakdown of the negotiations.”