1 non trade concerns japan’ key concept for agricultural negotiations may 2002 at ottawa ipc...
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Non trade concernsNon trade concerns Japan’ key concept Japan’ key concept
for for agricultural negotiationsagricultural negotiations
May 2002
at Ottawa IPC Seminar
JIRO SHIWAKU
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Launching of Comprehensive
WTO Trade Round by Doha
Declaration• Agriculture is a part of Quasi-
comprehensive agenda• But,Investment and Competion
deferred to the 5th Ministeral
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・
Ag part of Doha Declaration
Confirmation of Art 20 of UR Ag. Agreement
• Substantial improvement of market access
• Reduction of all forms of export subsidies, with a view to phasing out
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Substantial reductions in distorting
domestic support
Take into account
• Non-trade concerns• Special & Differential treatment
for developing countries
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Ag negotiations undertaken in advance of Doha Declaration
45 Proposals presented by 121 members since March 2000
Modalities of commitments to be
finalized by 31 March 2003
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Planned Schedule of establishment of
modalities
1) June to November 2002
Formal and informal discussion
2) 18 December 2002
Overview draft paper by chairperson
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January to March 2003• Discussion on the basis of draft paper
31 March 2003• Completion of modalities
Completion of negotiations (single undertaking)• by January 2005
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Japan presented negotiating proposal December 2000
• Basic features of Japanese proposal;
1) Coexistence of various types of agriculture,1. multi-functionality of agriculture
2. food security
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2) Adjustment of such elements of the rules & disciplines as are regarded to be imbalanced in terms of interests between exporting and importing countries
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Background of importance of multi-functionalty and food security
Arable land:4.6million hectars Paddy field: 1.8 million hectars Upland dry field : 2.8million hectars (vegetables , fruits, forage crops and others) Mountain & semi- mountain areas:
2/3 of national land
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Self sufficiency ratio:
Within 40% of total S.S.R. in terms of calorie jntake,there is a two tier structure • Extremely low S.S.R.products such as
wheat(9%), Barley(7%),Soya beans(6%), Corns(nearly 0%)
• Nearly self sufficient Rice(92%)
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Medium & long term instability of World Food Demand & Supply Demand
• Population growth in developing countries
• Increasing demand for meat, dairy products, oil&fat
• Increasing supply requirement for feed grain, oil seed
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Supply Various constraints on increases in production
Stagnated growth of productivityconstrains on expansion of agricultural
landDegradation of the environment
(desertification, global warming etc.)
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Short-term Instability of Supply and Demand
• Low percentage export/production• Dominant Supply by a few major
exporting countries• Diminishing stockholding by major
exporting countries• Dominance of grain majors and single desk
sellers
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Perceptions of Food Security among Japanese Public
Future food supply
feel very uneasy 27%
feel uneasy 51%
not feel uneasy 17%
not feel uneasy at all 2%
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Domestic Production Better produce domestically even if the price is higher 43%
Better produce domestically at least for staple food 40% Better import if the price is cheaper 11%
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Multi-functionalty of Agriculture
Conservation of national landPreservation of sound environmentMaintenance of good landscape
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Terraced paddy field in mountTerraced paddy field in mountainous areaainous area
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Multi-functional character of
paddy farming
1) Flood prevention
The flat paddy field surrounded by
bunds(small dyke)has the ability to
hold ponding water,which prevent
quick outflow of heavy rainfall
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A large amount of rainwater can be stored in a paddy field during a storm, at least for a few days. Accordingly,the peak flow rate of rivers will decrease and residential lots in downstream will be protected from flooding.
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2) Soil erosion prevention Surface water flow during a rainfall within a paddy field is moderate due to the flatness and the existence of bunks (dyke). Consequently soil erosion is
usually less than that in a upland field Also soil erosion by wind is rare in the
case of paddy whereas it is one of the serious environmental problem for upland dry field.
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3) Purification of water quality The pollution of groundwaters with
nitrate is.very rare in paddy farming ,
not only because excess nitrogen is
not usually applied to rice to avoid
their lodging , but also because nitrate
is denitrified to nitrogen gas in
anaerobic paddy soil.
4) Higher Utilization of Water Resources through a repeated use of irrigated water in the paddy field
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5) Conservation of biodiversity
• Paddy field can serve as the habitat for aquatic wildlife, such as flogs, dragonflies, medakas, fireflies, giant water bugs.
• Paddy field is also to offer habitat for migratory birds,such as sandpiper, plover, cranes from Siberia through Japan to Southeast Asia & Oceania.
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Perception of Multifunctionalty of Agriculture among Juapanese PublicNecessity of maximaizing the multifunctional role of agriculture
15%
23%62%
agree
rather agree
neither agreenor oppose
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Role of Agriculture Role of Agriculture other thanother thanFood Food production production
65.3%
56.4%
45.3%
39.8%
38.4%
34.4%
32.1%
32.1%
29.9%
33.4%
0% 10% 20% 30% 40% 50% 60% 70%
rural amenity
maintaining and revitalizing the ruralcommunity
transmitting culture
modification of climate change
cultivation of aesthetic sensitivity
formation of scenic landscape
food security
fostering of water resources
Land conservation
preservation of the naturalenvironment
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Japan Commitment in URAA 1. Export subsidies :continuation of non- utilization Domestic support: 20% reduction of AMS from 4966.1billion yen (base period) to 3972.9 billion yen (2000) Market access: tarrification of such products as starch, wheat, barley, dairy products, etc. Average 36% reduction as well as minimum 15% reduction of tariff
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Japan URAA commitment (continued)
Special treatment of Rice Trade Regime• Deferred introduction of tarrified scheme with minimum
access commitment higher than the standard case as a compensation.(48% in place of 3 5%)
• Shift to the tarrified scheme of rice. April 1999(2 years in advance of last year of implementation period)
• As a result, minimum access quantity has been slightly lessened from 8% to 7.2% in 2000
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1) Importation of minimum access rice, at the
present level of 7.2% of domestic consumption exerts unbearable burden to paddy farmers who are struggling to curtail nearly 40% of production capacity (one million hectares) to adjust to the decreasing trend of consumption (per capita consumption of rice: 138 kg in 1965, 60kg in 2000)
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2) Rice is a life line staple food for the country of 120 million population, because ;
1) their production by the waterlogged paddy is a very sustainable way in humid conditions of Asian monsoon climate zone
2) it is only one major item of Japanese agriculture to be able to meet the entire national consumption requirements.
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There are strong sentiments that it is
unfair for Japan to continue to be obliged
with this higher than standard minimum
access even after the shift to tariffication
Any pressure to further opening Japanese rice
market would be strongly resisted not only by
farm groups but also by most consumers whose
concern for food security is very high.
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Drastic change in policy
formulation structure Key players:
Government bureaucrats
__MAFF
__Four other Agencies(MOFA,
MITI,MOF, EPA)LDP Ag. Trade committeeZenchyu (Farm organization)
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Until URAA
The leading role of MAFF Bureaucrats in formulating policy directions.
___-Policy adjustment within the MAFF itself as well as among five government agencies.
The constructive consultation of the MAFF with LDP Agr. Trade committee which was guided by a small number of well desciplined leaders
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Political Reaction against Japan’s acceptance of the URAA
• In 1993, 8 coalition of non-LDP government had accepted the URAA.
• Strong resentment of LDP-farm related politicians against the Japan's acceptance of the URAA as being unfavourable to Japan's agricultural and food security interests.
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After UR Weakened leadership role of the bureaucrats of
MAFF and other agencies, due to
: poor management of economic policy
during the so-called lost 90's
: a series of scandals by high ranking
government officials Shift of policy decision initiatives from the
bureaucrats and changes in political
coordination style in LDP Ag. trade committee
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• Frequent and close Tripartite consultations among Zenchyu, LDP and MAFF
• The incumbent leadership of this powerful committee is determined to rectify the outcomes of URAA which they perceive as not taking fully into account the multifunctionality of agriculture nor well balanced in terms of the interests between the exporting and importing countries
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Japan's negotiating position on specific factors;
1) Market access
As for level of tariff and access quantity,
they must be set at appropriate levels with reasonable flexibility, considering such various elements :
securing the benefits of multifunctionalty; ensuring food security; the current situation of production and consumption for each product; international supply and demand;
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; and the progress of domestic agricultural policy reform.
In particular, due consideration should be given to the tarrified products, in order to secure the benefits of multifunctionalty and to ensure food security in each country .
Special safeguard measures should be maintained.
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2 Domestic support
In order to enable each country to promote agricultural policy reform , while giving consideration to securing the benefits of the multifunctionalty of agriculture and ensuring food security , the following improvements should be made:
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__requirements for Green Box policies should be improved, based on the
experience of URAA implementation;
the Blue Box policies should be maintained
__domestic support level should be determined in a realistic manner
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3 Rules and disciplines on exports Export rules and disciplines should be
strengthened, since it is necessary to
ensure the stability and predicability of
exports in order to ensure food security in
importing countries.
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The End of My Presentation
Thank you for listening