The Decline of Japanese Agriculture

The decline of Japanese agriculture has been well-documented (see Jentzsch in this volume). Estimates of the costs of sustaining Japanese agriculture vary: one economist calculates that it costs 4.2 trillion yen while creating only 5.3 trillion yen in added value, thus contributing only approximately 1 trillion yen, less than half of 1% of GDP.[1] Other calculations are even lower, with one suggesting that, costing almost 5 trillion yen but contributing 4.7 trillion, net Japanese agricultural GDP may actually be less than zero.[2] Organisation for Economic Co-operation and Development (OECD) figures indicate that as much as half of Japanese farm receipts come in the form of state support, compared with an OECD average of roughly 10%.[3] This massive state support comes despite the tiny contribution agriculture makes to the Japanese economy - essentially the vast sums of money invested can be seen as a kind of 66% consumption tax which results in Japanese consumers paying among the highest food prices in the world in order to sustain Japanese agriculture.[4] Although Japan’s average tariff rate is not unusually high, those levied on the ‘sacred five’ can be as much as 700%.

Despite these huge subsidies and high tariffs, the area of land under cultivation has dropped by almost a third since 1960 and the majority of Japanese farmers are now over 65.[5] Furthermore, only a fraction of Japan’s 2.5 million farmer households operate on a full-time basis, with the rest using agriculture to supplement pensions or other jobs.[6] Also, even as the area of land under cultivation drops, state policies, specifically the gentan policy of paying farmers to reduce rice cultivation, have resulted in large quantities of farmland being left uncultivated - although in 2013 the Abe administration announced plans to phase out the policy by 20 1 8.[7] Meanwhile, the food self-sufficiency rate has fallen from 79% in 1960 to approximately 40% today, with the important exception of rice in which Japan is self-sufficient.[8] This import dependency traditionally involved large-scale food imports from the USA, but today a number of other Asia-Pacific states are occupying an increasing proportion of food imports. China has become a major source of food imports, especially fresh and frozen vegetables and processed food - as outlined later, this increasing dependence on Chinese imports has become a source of controversy in Japan. With the increasing average age of Japanese farmers, the fiscal pressure on state coffers in the face of the ‘super-aging society’ and the 2011 Triple Disaster, neither the state’s agricultural policy nor Japanese agriculture itself appear sustainable in its current form.

The Ministry of Agriculture, Forestry and Fisheries (MAFF) has long defended the protection of Japanese agriculture due to the ‘positive externalities’ it produces, such as the protection of the natural environment and rural scenery, culture, rural communities, and national food security.[9] This ‘multifunctionality’ of agriculture was so enthusiastically taken-up by the MAFF that one scholar described it as becoming the ‘Ministry of Agriculture, Food Production, Farm Incomes, Agricultural and Rural Public Works, Rural Affairs, Industry and Environment, and Consumers, Food Supply and Food Safety’.[10] Multifunctionality is obviously not a neutral concept, and can be adopted for the defence of protectionist policies and used by ministries to extend their area of regulatory control.[11] As we saw, the so-called 1955 system - in which the Liberal Democratic Party (LDP) governed continuously from 1955 to 1993 - relied in large part on electoral support from Japan’s rural constituencies. These constituencies were over-represented in the diet: the large-scale movement of people from rural to urban areas was not matched by constituency adjustments, meaning that rural votes were (and in many cases still are) literally worth more than urban votes. Also, the former electoral system, using proportional representation, allowed the election of representatives with only a small fraction of the constituency vote (between 15% and 25%), enabling special interests to mobilize and back their own candidates without having to appeal to the broader population. All this led to a powerful farm lobby fronted by Japan Agriculture (JA, aka Zenchu), an umbrella co-operative group. This lobby effectively opposed the liberalization of Japanese agriculture throughout the boom years in Japan, but its influence has waned over the past two decades due to electoral reform, the sharp decline in the number of farmers, and Japan’s ongoing economic difficulties, and most recently by reforms under the Abe administration.

  • [1] Harada, ‘Japan’s Agriculture and the TPP’.
  • [2] Yamashita, ‘Ensuring Japan’s Food Security’.
  • [3] OECD, Producer and Consumer Support Estimates Database.
  • [4] Naoi and Urata, ‘Free Trade Agreements and Domestic Politics’.
  • [5] Yamashita, ‘The Perilous Decline of Japanese Agriculture’.
  • [6] Harada, ‘Japan’s Agriculture and the TPP’.
  • [7] As demand for rice has decreased consistently since the early 1960s, the government’s gentanprogramme keeps prices high by reducing supply through payments to farmers to leave their ricepaddies fallow.
  • [8] Yamashita, ‘Ensuring Japan’s Food Security’.
  • [9] Ministry of Agriculture, Forestry, and Fisheries, ‘What Is Multifunctionality of Agriculture?’.
  • [10] George Mulgan, Japan’s Agricultural Policy Regime, 167.
  • [11] Ibid, 29.
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