The TPP and Japanese Agriculture


In a meeting with his economic advisers on April 2, 2013, Japanese Prime Minister Abe clarified his definition of economic restructuring – the “third arrow” of his much-vaunted Abenomics – explaining that he wished to “eliminate bottlenecks and facilitate more business activity and investments.” Yet Abe is currently undermining his stated goal by balking on lifting agricultural import quotas as part of the Trans-Pacific Partnership (TPP) negotiations, despite joining the TPP talks with the understanding that the end goal was a comprehensive free trade deal. Japan’s behavior at the twelve-nation Ottawa meeting last week led New Zealand to suggest that Japan should be eliminated from the TPP if it does not open its markets to more farm imports.

Despite  boasting a majority in the Upper and Lower Houses of the Japanese Diet, it appears that Abe’s Liberal Democratic Party (LDP)-New Komeito coalition remains beholden to Japan’s agricultural interests. But even though agriculture’s influence seems to be holding steady, in the long run, Japanese farmers’ influence on Japan’s foreign policymaking will only dwindle as they increasingly lose clout in Japan’s domestic political process.

Farmers have been a bastion of conservative political support since the very beginning of electoral politics in Japan. The LDP used agricultural ministries and farm organizations to extend control over the rural electorate at the grass roots level, where populist parties were most threatening. Even though the LDP’s vote share in both Houses steadily declined in the 1970s due to increased urbanization, the LDP was able to stay in power due to malapportionment of votes and the variation in the district magnitude of electoral districts. In short, rural districts had more elected legislators per voter and smaller district magnitudes. Agricultural interests held sway over the government with their ability to elect LDP politicians dependent on them for winning public office, and therefore keen to protect their interests. These politicians were known as norin zoku (literally, agricultural policy tribe). For example, political retaliation for liberalizing agricultural trade with the 1988 beef and citrus agreement was swift and decisive: farmer support for the LDP dropped from 81 percent in the 1986 Upper House elections to 50 percent in 1989. The 1989 election reminded the LDP of its traditional dependence on the farm vote.

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In recent years, however, the LDP has begun to reduce its reliance on Japan’s agricultural cooperative, Japan Agriculture (JA). This is exemplified by Abe’s success in last July’s Upper House election following his March announcement that Japan would join the TPP over JA’s opposition. JA opposes the TPP because this liberal trade regime would challenge Japan’s existing agricultural welfare state. Electoral reforms in 1994 played a key role in Abe’s success, as redistricting reduced the acuity of malapportionment in favor of rural districts and the change from all multimember districts to a mix of single member districts and proportional representation increased the importance of broad electoral appeal.

Along with these electoral reforms curtailing JA’s influence, JA is simply no longer the vote-getting machine that it once was. Pundits contend that the rural vote is growing “soft” as they reacted to Prime Minister Koizumi Junichiro’s proposals for “structural reforms” by refusing to vote in the 2003 election. More recently, when famers started to benefit from the Democratic Party of Japan (DPJ) Ozawa Ichiro’s direct compensation program, they began defying JA recommendations and voting for DPJ candidates in the 2007 Upper House and 2009 Lower House elections. JA’s political difficulties are compounded by a demographic inevitability: the average age of Japan’s protected farmers is now 70. As The Economist commented on last year’s election, “The election result […] shows that some key opponents of the party’s economic-reform agenda, such as farmers, were in the event unable to punish it for adopting policies they dislike.”

The growing influence of Keidanren, the pressure group representing Japan’s business and manufacturing interests, is likely to counteract JA’s involvement in crafting future trade policies as well. Because credible issue linkage is built into the TPP negotiation structure, Keidanren is determined to see TPP succeed. Keidanren explicitly acknowledges this linkage by declaring in its joint statement with the Japan-U.S. Business Council, U.S. Chamber of Commerce and U.S.-Japan Business Council: “For Japan, it is essential to meet the commitment made to the United States and other TPP members upon admission to the TPP in April 2013 to subject all goods to negotiation, including agricultural products, with the goal of eliminating tariff and nontariff barriers on all.”

If Japan were to be left out of the TPP, manufacturing interests would suffer immensely, as they would be disadvantaged in their export and production activities. Keidanren supports trade liberalization as a catalyst for liberalizing uncompetitive sectors, and is strongly motivated by loss avoidance to keep Japan in the TPP. In 2005, Keidanren successfully pressured the government to sign a Free Trade Agreement with Mexico to defend members’ commercial interests. Members suffered a disadvantage against North American and European competitors because of the North America Free Trade Agreement and Mexico-EU Free Trade Agreement. Keidanren actively lobbied norin zoku members, and political contributions played a key role in this.

Though Keidanren had ceased political donations in September 1993, in May 2003 it decided to resume them. Political contributions again stopped in 2009 after the DPJ’s victory, but there is speculation that Sadayuki Sakakibara, the new chairman of Keidanren as of this June, may increase Keidanren’s political engagement in support of Abe’s economic policies. As The Japan Times puts it, “one question attracting strong media attention is whether Sakakibara will re-involve Keidanren in its member companies’ campaign contribution decisions, historically a tool with which the lobby has exerted influence in the political sphere.”

If Sakakibara decides that Keidanren will play a larger political role, some of that money will undoubtedly be used to help cement Japan’s position in the TPP. In the same joint statement cited earlier, the signors continue, “we will proactively advocate for the domestic political support required to ratify it in Japan and the United States.” Sakakibara has shown he has the diplomatic and international vision to take Keidanren’s lead on TPP, as he has already stated that he wants Japan to improve ties with China and South Korea. JA’s influence will diminish at an accelerated pace should Keidanren venture back into the game.

However, Keidanren must move quickly if it wants to secure Japan’s place in the TPP. Abe hopes that the “strategic value” argument is enough to placate TPP member states disgruntled by Japan’s foot-dragging, however, this line of argument is much more persuasive to Japan and the U.S. than it is to the other ten, as an editorial in The New Zealand Herald laments. Neither Australia nor New Zealand are as “keen” as Abe is “to use the TPP for a geostrategic political purpose. Both countries value a relationship with China as much, if not more, than their relationship with Japan.” China’s economic importance to the ten states – and their reluctance to choose between China and the U.S. – is illustrated by the fact that six of them are also members of the China-centered Regional Comprehensive Economic Partnership (Australia, Brunei, Malaysia, New Zealand, Singapore and Vietnam).

If Japan is to restructure its stagnant economy, it must not lose its momentum on TPP. Agriculture’s political influence is on the decline, and Abe should act that way, discarding his unnecessarily antagonistic “geostrategic” rhetoric and demonstrating Japan’s clear commitment to free trade. Only then can Japan thrive in the 21st century’s global economy.

Mina Pollmann studies at Georgetown University’s School of Foreign Service, majoring in International Politics/Foreign Policy.

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