Members of the main opposition Liberal Democratic Party this week expressed their reservations about the conditions of Japan's entry in the Trans-Pacific Partnership (TPP) free trade agreement, criticizing Prime Minister Yoshihiko Noda's stance that all goods and services will be put on the negotiating table.
The LDP wants agriculture (rice), insurance and the automotive sectors exempt from the negotiations.
The TPP, which involves nine countries, is a controversial issue for Prime Minister Yoshihiko Noda who has indicated that he would like to see Japan join the free trade framework. But he has been criticized by opponents within his own party as well as opposition parties for his vague statements on the issue.
The U.S., Australia, Malaysia, Vietnam and Peru are currently negotiating to join the bloc, which already brings together the smaller economies of Chile, New Zealand, Brunei and Singapore.
In February, the Japanese government held TPP talks with Singapore, Malaysia, Australia and New Zealand.
During talks with Washington on Feb 7, U.S. officials said they would not back Japan's participation in the talks unless Tokyo agrees to discuss tariff cuts on politically sensitive items.
Big exporters say that joining the trade bloc would allow Japan greater access to foreign markets, which would allay concerns that Japan is falling behind regional rivals such as South Korea in trade liberalization.
However, the LDP and some members of the ruling Democratic Party of Japan (DPJ) oppose opening the agricultural sector up to foreign competition. Agricultural products are protected by tariffs as high as 800%. Rice is the most contentious issue for Japan.
LDP members said this week that the agreement would devastate rice farmers. They also said that the trade pact would benefit corporations rather than ordinary people and have voiced fears that pharmaceutical companies could force up subsidized prices for medicine.
Proponents of the TPP argue it could be the much needed cue to reforming the agricultural sector that benefits from generous subsidies and protectionism.
Domestically produced rice is held to be far superior to foreign-grown grain. A poll last November by the Yomiuri Shimbun showed 89% of respondents claimed they would continue to buy Japanese rice, even if vastly cheaper imports were available.
Many rice growers are already suffering in the wake of the Fukushima nuclear disaster. "The TPP (issue) has come when more and more farmers are giving up their fields in Fukushima because of the nuclear accident," said a 57-year-old rice grower in Nihonmatsu, central Fukushima. "We are facing dual hardship."
While farmers are undoubtedly suffering, they still have powerful friends in powerful places.
The Central Union of Agricultural Cooperatives brokers rice distribution, provides financial support, spearheads pro-farming campaigns and lobbies politicians and bureaucrats.
Farmers have also formed lobbying groups to provide financial support for pro-farming lawmakers, and were key to sustaining the more than half-century of almost unbroken rule by the conservative LDP.
If rice is included in the free trade agreement, the enormous tariffs these farmer-friendly politicians put in place would have to go.
"If the TPP is introduced, Japanese rice would be defeated by foreign rice. There is no doubt about it," said Takashi Ogino, an analyst at Fukoku Mutual Life Insurance in Tokyo.
But Hideki Shimazaki, CEO of Top River, a firm that helps young farmers who want to establish large-scale operations, says there is no way to keep everybody happy.
"We can't avoid certain sacrifices in exchange for something more important," said Shimazaki, whose company seeks to introduce corporate-style management to old-fashioned Japanese farming.
"Conventional ideas of treating everybody equally do not work. We should lose the battle to win the war," he said.© Japan Today/AFP