(Nikkei: July 20, 2015 – p. 2)
Liberal Democratic Party members are seeking to secure budgets to strengthen domestic agriculture, as they shift their focus to political developments after talks over the Trans-Pacific Partnership trade pact are finalized. Among them, agriculture lobbyist politicians are particularly active, demanding the government allocate at least 1 trillion yen over multiple years. They are also stepping up efforts to win a larger share in budgetary requests for fiscal 2016, with an eye on House of Councillors elections scheduled to be held next summer. Meanwhile, concerns linger within the government and ruling parties that the moves may cause backpedaling on national efforts to cut spending and spark fears of pork-barreling.
On the morning of July 17, Agriculture Minister Yoshimasa Hayashi was called to the office of LDP President inside the Diet building. Waiting for him in the room were top LDP executives including Secretary-General Sadakazu Tanigaki and General Affairs Chairman Toshihiro Nikai, along with Nikai’s predecessor Koya Nishikawa and several other farm industry lobbyist legislators.
Hayashi was handed a list of requests drawn up by party executives up based on their study tour of domestic farmers. “We want the government to incorporate rice price increases and measures to help livestock famers into budgets,” said Nishikawa. Hayashi responded, “We will take this into full account.”
Early this month, LDP farm lobbyist politicians and Ministry of Finance officials met in Tokyo. “We need at least 1 trillion yen over several years [to protect domestic famers],” said one LDP legislator. “The government spent about 2.7 trillion yen when the Uruguay Round agreement was finalized in 1994.”
Japan was pressed to lower its import tariffs on farm produce during the Uruguay Round negotiations. In 1999, it also introduced a tariff scheme for rice imports. Back then, the ruling and opposition parties ratcheted up their pressure on the government to funnel more money into domestic agriculture. A total of 2.67 trillion yen (about 6.01 trillion yen on a project base) was allocated over eight years.
The government and the ruling parties envisage discussing related treaties and legislation at an extraordinary Diet session to be convened in autumn, with an eye on the early conclusion of TPP negotiations.
In the fiscal 2015 budget, about 2.3 trillion yen was earmarked to promote agriculture, forestry and fisheries industry. “We should urge the government to increase farm-related spending in supplementary budgets for fiscal 2015,” said one LDP farm lobbyist. Some even demand the government dole out a total of 3 trillion yen, which is equivalent to the amount it extended when the Uruguay Round agreement was signed.
It is predicted that the TPP will go into force in 2017 if the 12 countries ratify related domestic procedures within two years after the conclusion of the talks. Some farm lobbyists are looking to secure budgets before the enforcement of the trade agreement over a period of four to five years as part of expenses to step up Japan’s agricultural competitiveness.
The LDP is also looking ahead to next summer’s Upper House elections, as many single-seat constituencies are based on rural faming regions. Though the number of farmers is on the decline, it cannot afford to give up on the votes of 2.5 million farm households.
To protect farmers from the Uruguay Round deal, the government allocated most of the farm-related budget to agricultural engineering projects. Doubts are growing [the allocation of budgets equivalent to the Uruguay Round budget] can really help farmers step up their competiveness.
The government has decided on plans to achieve a primary-balance surplus by fiscal 2020. It may come under severe criticism if it goes on a spending spree in favor of farmers. (Slightly abridged)