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Editorial: Impact analysis of the TPP offers too little to create countermeasures

  • 2015-11-06 15:00:00
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(Kahoku Shimpo: November 6, 2015 – p. 5)

 

 A basic agreement has been reached on the Trans-Pacific Partnership (TPP) trade pact, and a government analysis of the TPP’s impact on about 60 agriculture, forestry, and fisheries products has been released.

 

 This analysis by the Ministry of Agriculture, Forestry and Fisheries (MAFF) contains contradicting statements, however. It indicates that “the impact [of the TPP] will be limited” while also saying that there are concerns that prices will drop in the long term. It is even hard to get a sense of how much prices will drop and how much impact the TPP will have once it is in effect because no estimates are given.

 

 Based on this analysis, the Liberal Democratic Party will issue its basic framework for agricultural countermeasures on Nov. 17, and the government will release a summary of countermeasures around Nov. 25.

 

 Countermeasures that treat the situation based on “rush work” (in the words of Shinjiro Koizumi, head of the LDP Agriculture and Forestry Division) without sufficient estimates of the TPP’s impact will not be convincing. It is unlikely that producers’ concerns about the future will be alleviated without gaining the understanding and agreement of taxpayers.

 

 The countermeasures presented should be considered “a springboard for conversation.” While explaining the countermeasures for the regions and listening to farmers’ views, the government should carefully refine them using a “measuring stick” that everyone can understand.

 

 To make the results of the analysis more concrete, MAFF divided 40 of the 60 key items into four categories by degree of impact from “low” to “high.”

 

 For 11 items, including adzuki beans and nori (laver), “no particular impact is foreseen.” For 22 items, including chicken, carrots, and plywood, “the impact [of the TPP] will be limited.” For the remaining 7 items, MAFF said that “it is hard to foresee any dramatic rise (increase) in imports” while also saying that decreases in prices in the long term are a point of concern.

 

 The level of concern [regarding future price declines] is second highest for rice, wheat, barley, and sugar and highest for beef, pork, and dairy products.

 

 This means that all three items expected to be the most impacted by the TPP fall under stockbreeding. In terms of agricultural output, stockbreeding was 2.7 trillion yen in 2013, higher than vegetables (2.3 trillion yen) and rice (1.8 trillion yen). To the extent that stockbreeding is the “top earner” in Japanese agriculture, the TPP’s impact on it must be carefully assessed.

 

 Tariffs will gradually be lowered on beef, and safeguards are in place to raise tariffs and control imports in the event that there is an excessive increase in imports due to tariff reductions. If MAFF were to imagine the scenario where imports rise and trigger the safeguards, they should be able to calculate import prices in the “worst case scenario” based on the range of tariff decreases. That price can serve as the standard for domestic products.

 

 Figures calculated using certain conditions even with restrictions in place are a sufficient basis for discussions. We would like to see the government strive to make this kind of “measuring stick.”

 

 One thing that should not be overlooked in this analysis is the following: Those products in the top two categories of concern for future price declines are all key agricultural products which the National Diet designated as “untouchable.”

 

 Akira Amari, the minister in charge of the TPP negotiations, was proud that the team “was able to fully protect the core areas of the five key items.” The MAFF analysis casts doubts on that, however.

 

 Furthermore, it has been revealed that the draft of the trade pact contains a provision stating that Japan will engage in additional talks about the tariffs with five countries seven years after the TPP takes effect. The five other countries include the United States, Australia, and other [major] exporters of agricultural products. Japan may be forced to open its doors even further.

 

 Information about the basic agreement has been released on a piecemeal basis, and it has been a unilateral presentation by the government. Yesterday, though, the entire draft agreement was disclosed. Before discussing the countermeasures, interested parties should conduct a strict review of the content and offer an overview as well as a description of the true nature [of the draft agreement].

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