Relations between Taiwan and Japan seem to have turned from sincerity toward a colder, more unfriendly business relationaship.
The Taiwanese government is preparing to lift a ban on the import of most food products from the areas affected by the Fukushima Dai-ichi nuclear power plant meltdown that followed the 2011 earthquake and tsunami — Fukushima, Ibaraki, Tochigi, Gunma and Chiba prefectures. The public hearings that the government has held have only resulted in heavy criticism from civic organizations and opposition parties.
Late last month, a meeting between Taiwan and Japan was held in Tokyo to discuss maritime cooperation between the two nations. It was generally hoped that this meeting would defuse the tension over Japan’s claims of an exclusive economic zone extending from the Okinotori atoll and the extension of fishing rights for Taiwanese fishermen in the area.
Apart from agreeing to meet once a year, set up a task force and to continue the dialogue, the meeting brought no concrete results and the government was yet again on the receiving end of severe criticism from fishermen and the opposition.
Pressured by Tokyo, Taipei is about to allow the import of food products from the regions affected by the 2011 nuclear disaster, but the Japanese government is taking a tough approach, paying no attention to the livelihoods of those in Taiwan who rely on fishing.
The fact is that Taiwan has several cards to play.
It should be understood that Taiwan is important to Japan’s agricultural sector and could perhaps even turn out to be its savior.
The biggest problem for Japanese agriculture is that its domestic market is shrinking due to a low birthrate and an aging society. Japanese Premier Shinzo Abe’s administration has been pushing the forestry, agriculture and aquaculture industries in the hope that it would be possible to find a better future for these sectors by relying on exports.
A look at the statistics shows that Taiwan is the third-largest export market for Japan’s forestry, agriculture and aquaculture industries, but taking Japan’s agricultural exports alone, Taiwan could be the most important of all its export markets.
Hong Kong and the US are the first and second-biggest destinations for Japan’s forestry, agricultural and aquacultural products, but the main export categories are concentrated around marine products.
In Hong Kong, the main imports are pearls, dried sea cucumbers and cigarettes, and in the US they are shellfish, yellowtail fish and alcoholic beverages.
In practice, if cigarettes are left out of the equation, the single biggest export item for Japan’s agricultural sector is apples to Taiwan.
Marine products have always boosted the exports of Japan’s forestry, agricultural and aquacultural sectors.
Articles in a Japanese academic publication on agricultural economics are generally of the opinion that the only export market that Japan has been able to open up in recent years is Taiwan — after the nation joined the WTO.
When it comes to Japanese apples, it is very common to see them on sale in Taiwanese supermarkets for NT$30 or NT$40 each.
That is close to the price in supermarkets in urban areas in Japan, where they cost about ¥100 (US$0.89).
In other words, Japanese apple exporters have been able to turn Taiwan’s market into an extension of the Japanese domestic market and they are now selling their products at affordable prices to consumers.
Taiwan has a population of about 23 million. This makes for quite a large market.
In addition, incomes in Taiwan are high and Taiwanese have a high level of acceptance of Japanese products.
Given Taiwan’s geographical proximity, it would be difficult for Japan to find another export market that is so accessible and so friendly toward Japanese goods to make up for its shrinking domestic market.
Japanese farmers can use Taiwan as a practice market and then turn their sights toward the bigger Chinese and Southeast Asian markets once they have perfected their strategies in Taiwan.
In practice, Taiwan is chosen as the first export market for many Japanese agricultural products. Fukushima Prefecture — the region most affected by the nuclear disaster — is a big producer of peaches and it first started exporting them in 2005, when it picked Taiwan as its first export market.
Its biggest annual export volume of peaches so far is 60 tonnes.
Following the nuclear disaster, Fukushima has aggressively tried to find new export markets for its peaches and the most successful market so far is Thailand, but it still only sold 15 tonnes there last year.
Japan is now eager to open up exports to Taiwan from the region most affected by the nuclear disaster.
In addition to wanting to remove the image of its products as being exported from a region affected by nuclear disaster, another reason for this effort is that the region truly is important to the livelihood of Japan’s farmers.
Taiwan’s importance to Japan’s agricultural sector cannot be overstated, so one can only wonder why it treats such an important customer in such a cold manner.
Guo Yung-hsing is a professor of international trade at National Taichung University of Science and Technology.
Translated by Perry Svensson
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