July 14, 2013 7:38 am

Japanese PM Abe vows to protect agriculture in trade talks

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Japanese Prime Minister Shinzo Abe has been busy reassuring farmers that he will not sacrifice them in his pursuit of free trade as he campaigns for next Sunday’s parliamentary elections.

“I will firmly protect the agriculture industry,” he told an audience in rural Yamagata prefecture at the weekend.

Two days earlier in Miyazaki prefecture, another sparsely populated area hundreds of kilometres to Yamagata’s south, he declared: “The provision of food to the Japanese people is the basis of the country. I will protect farming and fisheries.”

Japan is preparing for the first time to join talks over the Trans-Pacific Partnership (TPP) free trade bloc, whose 18th round begins in Kota Kinabalu, Malaysia, on Monday.

As a late-comer to the three-year-old negotiations, which involve a dozen countries in the Americas, Oceania and Asia, Japan will have less time than most to ensure that its interests are reflected in a final deal. The July 21 upper house election has put the focus firmly on the defensive side of its to-do list.

Mr Abe has promised to protect five “sacred” agricultural commodities from the elimination of tariff barriers that are central to the TPP: rice, wheat, beef, dairy products and sugar.

To hold the prime minister to his word, 60 members of parliament from his own Liberal Democratic party (LDP), mostly representing farming areas, have formed a “group to protect the national interest in TPP negotiations”.

In Malaysia, Japan’s 100-member negotiating team will have relatively little opportunity to press its case. Because of the timing of the Obama administration’s notification to Congress of its intent to accept Japan as a partner in the talks, Japan will be able to participate only in the round’s last two days, July 23-24. It will miss the portion devoted to tariff barriers entirely.

Politically, the delay looks fortuitous. Surveys show that about 55 per cent of Japanese approve of Mr Abe’s decision to join the TPP talks, but he is counting on a sweep of sceptical rural districts next Sunday to ensure that the LDP and its coalition partner, Komeito, take back control of parliament’s upper house. To that end, the less focus on TPP the better.

Mr Abe has been helped by a weak and disorganised opposition. The more left-leaning Democratic Party of Japan (DPJ), which ruled for three years before being swept aside by the LDP in December, is split over the trade talks.

In an effort to peel away disaffected LDP supporters in the countryside, its election rhetoric has taken on a protectionist tone. But the DPJ has too many urban liberals in its ranks to oppose free trade outright, leaving its message muddled.

So far, Mr Abe has got away with determined talk about protecting agriculture, without actually spelling out the form that protection might take.

He has allowed farmers to imagine that existing trade barriers – including Japan’s famed 700 per cent tariff on imported rice – will be left untouched. But experts say securing such sweeping exemptions will be difficult.

“Because the TPP embraces the principle of abolishing all tariffs within 10 years and includes strong agricultural exporting countries such as the US, Australia and New Zealand, Japan will find it extremely difficult to secure exemptions for all key items,” says Aurelia George Mulgan, an expert on Japanese politics and trade policy at University of New South Wales in Canberra.

Ultimately, “protecting agriculture” could mean winning long phase-in periods for tariff reduction, combined with increasing direct government subsidies to ease the pain of competition. A similar approach was used when Japan negotiated to join the World Trade Organisation in the 1990s.

Whatever concessions Japan wins, they will not come for free. In the US, labour unions and industry groups are already fighting hard against granting Japanese manufacturers freer access to US markets.

“A TPP free trade agreement that includes Japan will lead to significant worsening of our automotive trade deficit, and result in the loss of thousands of additional auto jobs in the US,” Bob King, president of the United Auto Workers, wrote in testimony to Congress this month.

Amid such pressure, and with its own exemptions to fight for, Japan is expected to agree to a long grace period, likely 10 years, for the elimination of US tariffs on imported Japanese cars.

Elsewhere, Japan will likely be a strong ally of the US and its entertainment companies which are pushing to include tough intellectual property protections in the TPP.

Japanese media reported this month that Mr Abe’s government would agree to extend copyright terms on music and other creative works by 20 years to 70 years following the death of the work’s author, matching the current standard in the US and the EU.

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