Bearing in mind that the Trans-Pacific Partnership (TPP) agreement and the Economic Partnership Agreement (EPA) with the EU will soon come into force, the Ministry of Agriculture, Forestry and Fisheries earmarked a total of 382 billion yen in the fiscal 2019 initial budget and the fiscal 2018 supplementary budget to support domestic farmers.
The TPP will become effective on Dec. 30 this year and the EPA on Feb. 1 next year. In the policy outline put together after the TPP general agreement in October 2015, the government decided to implement measures to help producers of the five important agricultural commodities (rice, wheat, beef/ pork, dairy products and sugar) maintain stable business. The ministry made the first allocation, a total of 63.2 billion yen, in the initial budget (including the special account).
Following is a partial breakdown of the allocation: increase in the subsidy rate for the system covering deficits in case livestock farmers’ income falls below production cost (17.6 billion yen); compensation for the decrease in income of wheat producers under the so-called import mark-up system, a de facto reduction of the tariff on wheat (4.4 billion yen); purchase and storing of Japanese rice in preparation for the import quota for Australian rice (2,000 tons for 4 months in the first fiscal year and 6,000 tons in fiscal 2019) (1.9 billion yen).
Besides these support measures, the outline also includes the implementation of measures to strengthen Japanese farmers’ international competitiveness before the TPP effectuation. The government started to earmark costs for improving competitiveness in the fiscal 2015 supplementary budget. It allocated a total of 318.8 billion yen in the fiscal 2018 supplementary budget. As imports of cheese from the EU are expected to increase, the government will help with branding Japanese cheese.