Japan Prime Minister Shinzo Abe‘s administration has submitted a proposal that aims to reduce protection for domestic farmers by putting an end to production rationing and across-the-board cash handouts in the next five years. This is part of the agriculture revitalization strategy that will be compiled and submitted for approval by the end of the month.
Pundits are surprised that this move has been approved by the ruling Liberal Democratic Party as the small farmers are their key base of support and the party has not been known to propose tough reforms when it involves their self-preservation. But some LDP lawmakers are highly critical of this blueprint as they say it will lose the trust of the farmers. This may also be a sign that the government is looking at domestic industries that are currently inefficient and small-scale farming is one of them. If the rationing and cash hand-outs are stopped, the price of rice will go lower and it might signal the end for small, inefficient farmers that are the dominant force in the industry. It will then give way to big farming operations who can extend their output and raise productivity to meet the onslaught of cheaper imported products.
The proposal seeks to end almost four decades of protecting domestic rice farmers as Japan continues to participate in negotiations for the free trade agreements in the Trans-Pacific Partnership. Expectedly, the small farmer groups are demanding that the government has to make up for that loss of protection by coming up with new subsidy programs. The farm ministry has actually come up with several new programs to protect the “multi-faceted functions of agriculture.”
[ via Wall Street Journal ]