Tue, Feb 27, 2007 - Page 9 News List

Japan is showing the way forward for agricultural free trade

Japan offers a seed of hope for agricultural liberalization with a demographic crisis in which the average age of farmers has reached the retirement age

By Malcolm Cook

Last year was a bad one for free trade. The Doha Round was supposed to make agriculture the centerpiece of negotiations to assuage the deep frustrations of developing countries. But instead of breathing life into free trade in food, rural protectionism in rich countries seems to have killed the Doha Round -- and, with it, potentially the whole multilateral trading regime.

Agriculture has always presented the greatest challenge to free-trade doctrine and its promise of empowering the poor, for it is one of the most distorted areas of global trade. In 2004, OECD countries spent more than four times their official development aid budgets on support for domestic farmers. In 2000, the World Bank estimated that OECD agricultural protectionism cost the developing world US$20 billion in welfare losses annually. Most galling, agriculture is a small and declining part of these "rich club" economies, and the richer and larger they are, the less significant agriculture is and the more resources are wasted on rural welfare.

The practical challenge comes from agriculture's two advantages that insulate the rural sector from global market forces and turn even the most urbane, liberal politicians into its defenders. First, farming is geographically concentrated and farmers vote on agricultural policy above everything else, greatly enhancing the power of their votes -- something that few, if any, urban consumers do.

Second, protectionists have developed populist but logically questionable arguments that agricultural staples cannot be treated as tradable commodities subject to competition. Domestic farmers are portrayed as irreplaceable defenders of the social fabric and traditional values. On top of this, farming is presented as analogous to the military. Just as no government should outsource national security to untrustworthy foreigners, nor should any government permit the national food supply to rely on the supposed vagaries of foreign production.

We accept paying a high and inefficient cost for national defense against what are often unknown enemies. Agricultural protectionists, through the language of food security and food self-sufficiency, claim that the same holds true for food.

Japan has long been the paragon of rich-country agricultural protectionism. Its electoral system heavily favors rural voters. Farmers are well organized politically, and the Ministry of Agriculture, Forestry, and Fisheries (MAFF) has been a fierce defender of agricultural protectionism. Food security arguments resonate well in Japan, owing to memories of shortages during World War II and its aftermath.

Ironically, Japan now offers a seed of hope for agricultural liberalization. The country's declining number of voters are lining up in favor of cheaper, imported food. Japan's demographic crisis is particularly acute in rural areas, where the average age of farmers is surpassing the retirement age. One enterprising village recently sold itself entirely to a waste disposal firm after it could no longer find any young people willing to return to bucolic bliss.

Despite decades of government support, the rural sector cannot aspire to feed its declining population. Food self-sufficiency in staple cereals now stands at 28 percent on a calorie supply basis, with no signs of growth. Farming, fishing, and forestry now account for less than 2 percent of the total economy and less than 4 percent of the workforce.

This story has been viewed 5351 times.

Comments will be moderated. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned.

TOP top