The economic growth strategy endorsed by the Cabinet on Friday included bold agricultural plans to boost crop exports and raise income among farmers, but fell short of allaying their worries about joining the Trans-Pacific Partnership trade talks.
Under Prime Minister Shinzo Abe’s “third arrow” to lift the economy out of long-standing deflation and kick-start growth, his government pledged to double crop exports to ¥1 trillion and agricultural earnings to ¥6 trillion by 2020.
At the same time, however, the government promised to promote trade liberalization and raise the ratio of trade conducted via free trade agreements in value terms to 70 percent from the current 19 percent by 2018.
Japan is set to become the 12th member of the TPP free trade negotiations from late July and is in talks on forming a trilateral FTA with China and South Korea. It is also angling for a trade liberalization pact with the European Union.
“A promise to double income while pursuing the TPP is like shaking someone’s hand and kicking them at the same time,” said Tomohiko Teramachi, a Hokkaido farmer who fears his wheat and sugar beet will be unable to compete with cheap foreign imports if tariffs are eliminated under the TPP.
Joining the Pacific Rim initiative is estimated to slash Japan’s agricultural output by ¥3 trillion, a figure excluded from the government’s growth strategy.
Hideo Kumano, chief economist at Dai-ichi Life Research Institute, said the plan to transform agriculture into a major money-making industry may be somewhat “idealistic,” given its years-long stagnation.
“Japan’s agricultural exports have remained very small in scale at around ¥450 billion. . . . I have some doubts about it turning into a ¥1 trillion industry all of a sudden,” he said, pointing to such pressing issues as the rapid aging of farmers and the shrinking food self-sufficiency rate.
The president of the Central Union of Agricultural Cooperatives, Akira Banzai, voiced support for the government plans, saying they are “in line” with the group’s goals. But even its members have shown skepticism.
“While we are looking in the same direction (as the government), we have not set specific target figures because they are not easy” to achieve, said a senior official of the group.
The latest steps include many proposed by previous administrations, including Abe’s first team from 2006 to 2007, such as realigning farmland and creating an entity for managing and leasing farmland to others, including agricultural corporations.
Still, economic revitalization minister Akira Amari insisted the growth strategy marks major progress on many pressing matters, such as boosting crop yields.
“There were five or six issues that have not been resolved for a long time, but we have resolved them within the short time frame of five months,” Amari said after the Cabinet approval.
While the real challenges of implementing the strategy lie ahead, “we will pursue these measures at an unprecedented speed,” Amari assured.