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Japan hungry for food export
business
By Suvendrini Kakuchi
TOKYO - Mention "Japanese exports" and cars,
machines and electronic gadgets come to mind, but the
country's economic planners now want this list to be
joined by expensive but high-quality agricultural
produce, from fruits to Japanese rice.
This is
part of a new official policy by the Japanese government
to change the traditional composition its exports, which
have been heavy on industrial goods but not agricultural
produce.
"Japan is planning to export more farm
products to Asia. We are keen to reduce the huge
imbalance between industrial and agriculture exports,"
said Takeshi Kanai, an official in charge of rice
exports at Zenchu, the powerful Central Union of
Agricultural Cooperatives.
Zenchu is part of a
cooperation agreement among the Agriculture Ministry,
local governments and agricultural cooperatives to
promote exports among farmers, who are now eyeing
upmarket consumers for their goods across Asia and the
world.
The new policy, which has received mixed
reviews from some analysts, is also seen here as a way
to help Japanese farmers, who are smarting from
increased competition as the local market liberalizes -
a sensitive issue in a country that has traditionally
been closed to agricultural imports.
"We hope to
stimulate demand overseas for Japanese farmers who are
struggling with more global competition as the Japanese
market liberalizes," Kanai said.
Figures on
Japan's agricultural trade show that its imports were
about US$6.8 billion in 2002, far exceeding its exports,
which included pearls and tobacco, at 350 billion yen
($2.96 billion).
Against this backdrop, Japan
continues to resist fiercely attempts by foreign
countries to reform its highly protected agricultural
sector, saying for instance that its rice production is
a matter of culture as much as trade. Even when Tokyo
made a long-awaited decision in 1994 to start taking in
limited rice imports, it slapped on tariffs of up to 410
percent to protect the domestic market.
Japan's
agricultural imports soared as the country embarked on
its rapid economic miracle after World War II.
Currently, Japan's food self-sufficiency is only 27
percent, compared with 137 percent in the United States
and 100 percent in China.
The issue is a major
grouse in a nation of 127 million people that is
resource-poor and still haunted by memories of
starvation during World War II, and which has to obtain
a lot of its needs from outside.
Trade analysts
say a successful effort to push Japanese agricultural
exports may stimulate willingness to open local markets,
although there are questions about how far these exports
can go.
Yukio Minagawa, director of the Overseas
Market Development Board for the Japanese Agricultural,
Forestry and Fishery Products, launched last month,
acknowledges that exports of Japanese agricultural
produce would be expensive. But he says farmers can
compete by catering to rich consumers who have emerged
after high growth elsewhere in Asia, and take advantage
of markets that Japanese products have developed among
high-income consumers.
"Asia is important for
the Japanese farmer. There is a niche market patronized
by rich shoppers that our farmers can tap into," he
explained.
Right now, the United States is the
largest market for Japanese farm products. But Minagawa
says that Asia, headed by industrialized economies Hong
Kong and Taiwan, comprise 62 percent of the trade that
includes pearls and tobacco followed by fruits.
Japanese pears, apples, and yams are already
being exported to Taiwan, Hong Kong, Singapore and
China, according to ministry statistics. Farmers in
Shimane, southern Japan, are also planning
low-chemical-rice exports to Taiwan under a
government-sponsored plan.
Japanese beef exports
to the US, Hong Kong and Singapore were suspended last
year because of a scare over "mad cow" disease.
Minagawa points out that Taiwan is the biggest
market for Japanese apples, whose export value reached
$22.9 million in 2002 although its prices were almost 20
times as high as their local counterparts'.
But
Daisuki Hiratsuka, an economist and Thai specialist at
the Institute of Developing Economies, brushes off the
latest project as a minor impetus for the agricultural
industry.
"Japanese products are far too
expensive even for the Japanese consumer. Even if they
get anywhere in Asia by providing high-quality fruits
and vegetables, the market will be too small to make a
difference," he argued.
Indeed, statistics
provided by Zenchu show that exports of Japanese rice -
appreciated for its high quality and fragrance - to six
countries in Asia were a dismal 120 tonnes annually.
The situation in Thailand, itself a major world
exporter of its rice, supports this viewpoint. Japanese
rice sold in Thai supermarkets is at least 10 times the
price of local rice. In addition, to cater to the rising
demand for Japanese food, Thai farmers have begun to
produce and sell at lower prices similar strains of rice
being sold in Japan.
In the end, Hiratsuka
contends, the latest policy underscores the government's
keenness to keep Japanese farmers, a key vote bank for
the ruling conservative Liberal Democratic Party, happy.
"By providing a central government-sponsored
incentive, the protected farming population and the
ministry that works hard to maintain this dependence do
not feel abandoned," he said.
Kanai said Zenchu
is not expecting official subsidies but hopes the
Agriculture Ministry can help with marketing exports.
"The first steps in the process to increase exports will
be undertaken in the fall, with teams of experts going
to China to investigate the market," he said.
A
report by the Asahi newspaper on August 8 suggested that
the plan to increase farm exports is also part of a
larger plan by the Agriculture Ministry to protect it
against bureaucratic reforms by the government of Prime
Minister Junichiro Koizumi.
A system where
ministry officials are employed by the Japan External
Trade Organization (JETRO), a semi-governmental trade
group, is in danger, remarked the article, pointing to a
streamlining measure now under way in the organization.
Hirastuka agrees. The Japanese farmer, he says,
needs to become more competitive and weaned from
dependence on government subsidies, instead of being
given yet another official project that sounds good but
is not profitable.
(Inter Press Service)
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