(Hokkaido Shimbun: February 19, 2016 – p. 3)
The Hokkaido Government has issued a provisional calculation of the impact of the Trans-Pacific Partnership trade pact on Hokkaido’s agricultural, forestry, and fisheries production, saying that the prefecture’s production value will drop by between 40.2 billion and 59.8 billion yen.
Farmers are saying, “The estimate is out of touch with reality.”
Of course it is. The local government’s estimate simply follows the December 2015 calculation by the national government, which was criticized as “overly optimistic.”
The local government estimate can in no way be said to reflect the sense of crisis among Hokkaido producers. Any policies based on this estimate will also be insufficient.
What the Hokkaido Government needs to do is not simply take the national government’s estimate and apply it in a theoretical fashion to Hokkaido. It is critical that our local government analyze the impact of the TPP based on the reality of Hokkaido producers and develop necessary policies accordingly.
The national government’s trial estimate is calculated on the premise that domestic agricultural, forestry, and fisheries production volume will not decline after the TPP comes into effect, thanks to domestic measures to reduce costs and increase value-added, etc. This can only be called a wishful thinking.
A typical example of such thinking is the statement that the TPP will have “zero” impact on rice.
For rice, a new duty-free import quota has been set for the United States and Australia. The national government says that the amount of rice in circulation will not change because it will buy up domestically produced rice in the same amount as the imported rice and hold it as reserves. The Hokkaido Government has copied that.
However, if the amount of inexpensive foreign-grown rice in circulation increases, the price of domestic rice will decline and a lowering of the domestic production volume will be unavoidable.
In the case of milk and dairy products as well, the national government has underestimated the impact [of the TPP], saying, “It is hard to foresee a rapid increase in imports for the time being.”
With this, the Hokkaido Government has estimated the impact [of the TPP on dairy] at between 17.9 billion and 25.8 billion yen. Although that is almost 90% of [the estimated TPP impact on Japan’s total dairy production value], it represents less than 10% of Hokkaido’s dairy production value [which was 318.3 billion yen in 2009].
“If it were only that simple! But it isn’t,” some say with concern. A rise in dairy product imports may lead to a decrease in revenues for Hokkaido dairy farmers and accelerate the ongoing decline in the number of dairy farms.
There is a provision in the TPP agreement requiring that the tariffs be reviewed after seven years. If imports of butter and cheese increase further, the possibility will also arise that the dairy plants in Hokkaido’s dairy belt will be consolidated. This will impact employment in the area.
What is an even greater issue is the fact that the Hokkaido Government has not included in its trial calculation an analysis of the impact of these kinds of related issues.
Agriculture and other primary industries are Hokkaido’s key industries, and they support the local economy, including processing.
If key industries decline, it will be a blow to the locality and could lead to the collapse of the area.
The Hokkaido Government is expected to take the perspective of Hokkaido at all times. It should redo its calculation after carefully listening to the views of the local people.