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ECONOMY > Trade

Ministry of Finance to maintain safeguard mechanism for beef next fiscal year

  • November 29, 2017
  • , Nikkei , p. 5
  • JMH Translation

The Ministry of Finance is poised to maintain in fiscal 2018 as well the safeguard mechanism that is triggered in the event of a sudden increase in beef imports. Noting a sharp rise in imports of frozen beef from overseas, including the United States, Japan implemented the safeguard in August and raised the tariff. The United States lodged an objection with Japan, and the question of whether Japan will lift the mechanism has been the focus of attention.

 

At the Uruguay Round of the GATT (General Agreement on Tariffs and Trade), the government agreed that in exchange for voluntarily lowering its tariff on beef to 38.5%, it would raise the tariff to 50% should import volumes spike suddenly. The Uruguay Round was agreed between Japan, the United States, and other countries and came into effect in 1995.

 

The Ministry of Finance determined that imports of foreign frozen beef exceeded the predetermined limit in the April-June quarter this year and put the safeguard into effect from August through the end of March next year. This is the first time in 14 years for the safeguard to be implemented.

 

American livestock farmers and the U.S. agriculture secretary objected to the safeguard and demanded that Japan lower the tariff immediately. But at the Japan-U.S. summit in November, the U.S. side did not make any strong demands in the agriculture sector, so the Finance Ministry will maintain the safeguard mechanism next fiscal year as well. [Japanese] demand for U.S. frozen beef has risen in recent years, so the possibility remains that the safeguard will be triggered next fiscal year and beyond as well.

 

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