The Japanese government decided Tuesday to end its decades-long policy of protecting rice farmers by limiting their production and providing across-the-board cash handouts.
The major policy shift comes as the government seeks to stimulate the highly protected industry, which is expected to face fierce competition from foreign farmers when the envisioned Trans-Pacific Partnership free trade agreement opens the way to an influx of cheap imports.
Under a new system to be launched in fiscal 2018, farmers will be allowed to decide production volumes based on the government’s supply and demand forecasts, instead of the quota system launched in 1970 to limit production and keep prices from plunging amid declining consumption.
“I would like to push forward a major reform of agricultural policy,” Prime Minister Shinzo Abe said during a meeting on farming policies, adding he will “eliminate policies that go against structural reforms.”
Farm minister Yoshimasa Hayashi, who also attended the meeting, said the government plans to submit bills on the reforms to the regular Diet session early next year.
With the 12 countries involved in the TPP negotiations striving to reach a deal by the end of the year, it is an urgent task for Japan to enhance the international competitiveness of its agriculture. To that end, the government is planning to include measures aimed at strengthening Japan’s agricultural as well as forestry and fishery sectors in a draft supplementary budget for fiscal 2013.