WTO Ministers' Meeting Comes to a Close

Reviewed By Hitoshi URABE

Article:
"WTO Ministers' Meeting Comes to a Close"
http://www.washingtonpost.com/wp-dyn/articles/A17213-2003Feb16.html
(by Yuri Kageyama, The Associated Press) Washington Post

Comments:

The informal meeting of ministers held in Tokyo, intended to pave the way for the formal meeting scheduled later in the year, resulted in a disaster albeit all the fancy diplomatic terms encrusted on the communiqués that came out of the meeting.

It was Japan's request to hold the meeting in Tokyo in order to impress and confirm to the world of its intentions with regard to farming issues, of which Japan is against further liberalization. However, Mr Harbinson, the chair of WTO farm negotiations, by breaking tradition, had announced his draft paper recommending drastic decrease of tariffs on farm produce before the meeting started. To dissatisfaction of Japan, the aggressive proposal to liberalize farming nevertheless served as a de facto starting point of discussion. Ms Kawaguchi, Japan's delegate and the chair of this ministerial meeting, had to describe the proposal as merely a "catalyst" to play it down in her summary of the meeting.

It has been a while for Japan to place its utmost priority on protecting domestic production of rice. It used to be argued that in order to maintain food security, the volume of food produced domestically should suffice the needs of the domestic population, and as rice being the staple food for Japanese people, a certain level of domestic production must be maintained even at a cost. Accordingly, rice for direct consumption by people is currently still 100% domestically produced, while the very limited import is utilized for other purposes.

The idea of food security is based on the premise that people must be fed even when there would be no other country to sell food. Some sneer at the thought for it to be improbable and unrealistic, while others feel that the philosophy may be valid at the bottom line. The fact of the matter is, however, that the situation is far ahead, or behind depending on your view, to make the discussion meaningful.

The self-sufficiency ratio of food, based on calorie supply, in Japan is 40%. It means that Japanese people rely 60% of their nutrition on imported food. The number was 80% in 1960 and has kept dropping since, to 50% in 1987 and then to 40% for the past several years. The number is one of the lowest even among the industrialized countries. France is 132%, and the US 125%, while in Germany, UK, and Switzerland the ratios are 96%, 74%, and 61% respectively.

It is noted that many industry-oriented people resent the government's approach in protecting farmers. Japan's industrial goods, such as cars and electronics, have had to work hard to become competitive in the global market, and for those people it seems the agriculture sector, by its low productivity rate, is not only dragging growth of Japan's economy but also inviting accusations from abroad that the country is a protectionist.

In terms of traditional growth and trade theory, this may be true. It is also probably true that the majority of Japan's population are aware of the government's protectionist measures and are discontent for being forced to buy expensive agricultural produce as consumers. Nevertheless, at the same time, there is a certain level of uneasiness among people at the low self-sufficiency ratio of food, instinctively if not logically, that it might be better for the figure to not become too low.