The Japanese Connection: New Zealand, Rural Japan and the TPP.



WHAT HAS THE JAPANESE COUNTRYSIDE got to do with the New Zealand countryside? Should we care that over the course of the past 20 years the amount of uncultivated Japanese farmland has doubled? Does it matter to New Zealanders that only 10 percent of Japanese farmers are under the age of 65?

In searching for the answers to these rather obscure questions, I could not help being struck by how interconnected our world has become, and how very difficult (some would say impossible) it would be to disconnect ourselves.

What’s happening in the Japanese countryside matters because the Liberal Democratic Party, Japan’s dominant political party, has been able to count on the overwhelming support of Japan’s peasant farmers ever since the United States Occupation Government forced through comprehensive land ownership reforms back in the 1940s.

Prior to these reforms the Japanese countryside had retained much of its feudal character, with land ownership concentrated in the hands of a tiny aristocratic elite. The American reforms overnight created tens of thousands of family-owned small-holdings which, like the peasant smallholdings of Europe, remained economically viable only by means of massive state subsidisation. Basically, Japanese city dwellers (the overwhelming majority of the population) paid higher prices for agricultural produce so that the “real” Japan of paddy-fields, quaint rural villages – and rock-solid Liberal Democratic Party voters – could remain unchanged.

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Obviously, no post-war Liberal Democratic Government was going to put its electoral base out of business by allowing the importation of cheaper agricultural produce from the USA, Australia or New Zealand. Huge tariff barriers thus remained a constant feature of Japanese economic policy throughout the Cold War period. And if protectionism was what it took to keep the crew of their unsinkable Japanese aircraft carrier happy and prosperous, then the Anglo-Saxon powers of the Pacific rim were happy to oblige.

But the Cold War is over. The CIA no longer needs to rig elections in favour of the Liberal Democratic Party. The Soviet threat has gone, and the USA’s willingness to see its agricultural producers shut out of the Japanese market has gone with it. The pressure is on for the Japanese government to embrace trade liberalisation.

Which brings us back to the Japanese countryside. Rural Japan, like the whole of Japanese society, is rapidly ageing. With 90 percent of Japanese farmers now over the age of 65, Japanese agriculture is experiencing a steep decline. Land once under the plough is reverting to brush and woodland. The 1940’s land reforms, by locking Japanese agriculture into small scale production, have prevented it from being rationally reorganised. Just as the state subsidisation of Japanese agriculture has prevented it from responding to market signals.

But nothing lasts forever. Accompanying the decline in Japanese agriculture there has been a corresponding decline in the electoral heft of small farmers and their families. And, as the influence of the formerly dominant protectionist, Heisei Kenkyukai, faction of the Liberal Democratic Party has dwindled, the long-ignored more-market, Seiwa Seisaku Kenkyukai, faction of the LDP has grown in significance.

Japan’s new prime minister, Shinzo Abe, hails from this far-right faction and his radical liberalisation programme – nicknamed “Abenomics” – promises to open up Japanese agriculture to international competition. Hence Japan’s recent decision to enter the negotiations for a Trans-Pacific Partnership (TPP) free trade agreement.

Which brings us back to the New Zealand countryside.

New Zealand’s agricultural problem is the precise opposite of Japan’s. Far from farmland falling out of cultivation, New Zealand farmers are running out of farmland to cultivate. This need for more land – especially for dairying – is what is driving the National-led Government’s weakening of the Resource Management Act and has already led to the shutting-down of the Canterbury Regional Council, as well as the current furore surrounding the proposed Ruataniwha Dam. Dramatically intensified land use (once again attributable to dairying) is also responsible for the serious pollution of so many of New Zealand’s lowland waterways.

New Zealand agriculture’s long-term prospects lie in exporting not just milk powder, butter and cheese, but the superior techniques New Zealand farmers have developed for producing these commodities. If Japan’s agricultural sector is to be rationalised, who better to show that country how it should be done than the world’s most productive farmers.

But, before we can think about cashing-in on the knowledge we possess in terms of maximising agricultural production, we will first have to get the Japanese familiar with our agricultural products. That can only happen if Japan agrees to eliminate its tariffs and to guarantee the integrity of New Zealanders’ intellectual property.

Viewed from this perspective, it is easy to see why the National-led Government is so keen on the TPP and why, even though it may be more willing to press for greater transparency in the negotiating process than its National rival, Labour likes it too.

Not only does the TPP hold out the possibility of New Zealand adding much greater value to its agricultural exports – to the point where our export income is derived increasingly from the “how” of agricultural production rather than the production itself – but also, by reducing the pressures on land and water use in our own countryside, the TPP offers New Zealand’s beleaguered natural environment a much needed respite.

Those who oppose the TPP have been eloquent in enumerating the many disadvantages of New Zealand signing up. There is, however, much to be gained from this country’s exports gaining access to the huge markets that hitherto have been closed to them.

The situation in the Japanese countryside offers extraordinary possibilities to New Zealand’s agricultural sector. Prime Minister Abe is about to do to rural Japan what Roger Douglas did to rural New Zealand in the 1980s. If New Zealand fails to seize the opportunities such a dramatic shift in Japanese agricultural policy offers, then some other country will step in to reap the benefits.

Those on the Left who decry free trade agreements like the TPP should remember that before wealth can be redistributed, it must first be created.

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  1. There in lies the rub .
    NZ has fifty three thousand people deriving their sole income from the land and four million two hundred and fifty thousand people who don’t . ( Source Statistics NZ . ) What’s Japans ratio I wonder ?
    When , for example , the IT industry becomes sexier than growing food , you know you’re in deep , deep shit . Fucking and starving are uncomfortable bed fellows .
    roger douglas pimped us out to foreign banks , he also sabotaged our economy and that’s directly related to our awful and frankly embarrassing social statistics . He should be in prison .

    The New Zealand farmer has the future ( and the past ) of our country in the palm of their hands but so far , all I see is a shiny new Toyota Hi-Lux and a pair of muddy , red band gumboots parked up outside the local super market doors . Moving down to the cemetery , you might find more than a few suicides .

    Here’s what I’d suggest . All you digitals ? Go crazy ! Rape as you like . It’s something you know after all . And you analogues , you artists and lovers and humans ? Emigrate to the south west of France .
    I loved this . Enjoy .

    • Emigrate to the South West of France??? You mean the country where they massively subsidise uneconomic farming practices and where left wing policies has virtually brought the country to it’s knees. Why would you recommend someone move to a place where they will soon be forced to undergo a period of massive austrerity that would make the reforms in NZ look positively mild in comparison?

    • Funny you mention France, I have been day dreaming of moving to France. I am sure this country is being set up to get rid of artists, writers, and anyone interested in anything other than money. N.Z is being groomed as a rich persons paradise, anyone else is treated like they don’t belong here, and have nothing to offer if your not running a corporate company. No Maori person would really want to live in Australia if the jobs and money were ‘ here’ would they? I am a pakeha person from many generations in this country and it seems like anyone who just arrived here calls themselves Kiwis, and act totally at home when the real New Zealanders are getting the shove. Also the sprawling out of urban areas is just ugly, this country is looking like a junk yard. Many European tourists I’ve meet actually think N.Z is ugly, exceptions are the national parks of course. Think of French villages compared to most of N.Z. Look at the dairy farm houses springing up in the country they are revolting brick blocks bunged in a paddock no aesthetic thought at all, cluttering up the space between towns. I hate seeing this lack of aesthetic spoiling any drive in the country, let alone all the beautiful shelter belts being pulled out in Canterbury in favour of giant watering machines marching across the paddocks unencumbered. I wonder if this had anything to do with that huge wind problem they just had pushing them all over? Shelter belts were there for a reason not just nice to look at. This country will be a spoilt mess soon, and I’ll have nothing left to want to paint here, it’s not an inspiring scene.

  2. There is a more to the TPP than meets the the eye. Most of the opposition is down to secret chapters regarding copyright, medicines and the ability of corporates to sue governments.
    I am surprised you are so willing to support the TPP for a few crumbs.

    • Would you support the TPPA if the offending sections on copywrite and other intellectual property protections were not implemented?

      • Let’s not also forget the uncomfortable issue of China and the TPP.

        If this agreement isn’t about anti-Chinese geopolitics and the American pivot strategy, why isn’t this country and its very large economy invited?

        • The US wasn’t initially invited. It asked to join. Ditto Japan. If this was some sort of geo-political conspiracy to contain the power of China as you suggest then why weren’t these two nations involved right at the start of the process instead of the bloc of relatively free market nations (one that negotiated a FTA with China already) that kicked it off?

          • But the Americans now dominate and drive the process, and their interest in doing so seems to coincide with their announced pivot strategy. Given that their attention was on the mideast prior to the pivot it makes perfect sense that an obscure idea for yet another round of talks for yet another regional free trade zone didn’t get their attention until the state department shifted its attention to the Asia Pacific region.

            As for Japan asking to join, this also fits the bill what with their renewed tensions with China over the Senkaku/Diaoyu islands, and their energy independence strategy having been shattered by the aftermath of Fukushima Daiichi accident.

  3. New Zealand agriculture’s long-term prospects lie in exporting not just milk powder, butter and cheese, but the superior techniques New Zealand farmers have developed for producing these commodities.

    No. The second part of that equation is the recipe for long term impoverishment, unless, of course, you embrace globalisation and put agri-corporation interests before national interest. Somehow I think not.

  4. Chris the main connection is missing from your scenario.
    The US is using the TPPA to lock China out of the Pacific.
    China is outcompeting and outproducing the US in the value chains of raw materials to consumer goods including milk products. This is because as well as low costs, China has many restrictions to open entry in the internal market.
    Australia and NZ are already signed up not only as raw commodity producers but in technology transfer. China owns Aussie mines and NZ dairys and Aussie and NZ get a smoother ride inside China.
    The US wants to trump the existing FTAs with China by putting itself on the same footing as these FTAs.
    Japan under Abe seeks to overcome its decades of stagnation by also getting equal status inside China.
    US and Japan are big producers inside China but want to increase their competitive advantage in breaking down China’s political and legal barriers to full entry into the market.
    Piggybacking NZ into Chinese dairy farms to supply China and Japan is the connection you are looking for. Not the dying peasantry in Japan.

    • How will China be locked out of the Pacific by the TPPA? As far as I aware the agreement does not nullify any existing agreeements (e.g. NZ and China’s FTA).

      • But that’s NZ – the others don’t have FTAs with China, and China isn’t being invited to the TPP party. Add that to America’s (quite openly announced) Asia pivot, and you’d have to present one hell of an interesting argument to suggest that there is an innocent reason China isn’t invited, and that it isn’t due to the TPP being part of the strategy to reorient the Pacific towards the USA and away from China.

        • The US and Japan weren’t invited either initially but requested to become part of the negotiations after they had been going for a while.

          • Yes, by which time Japan’s postwar energy independence strategy had been broken by Fukushima, and they were in a dispute they can’t win with China over the Senkaku/Daioyu islands.

            Likewise, the Asia-Pacific region was not the main area of foreign policy focus for the USA prior to the pivot being announced.

            But let me ask, were you diversion trolling, or genuinely unaware of these factors?

            • Not diversion Trolling. Merely pointing out a fundamental flaw in your view that the TPPA is being driven by a desire to constrain China. The nations involved in setting it up weren’t driven by this imperative but by the principles of free trade.

              China is hardly constrained by other nations entering into free trade arangements anyway. The fact the EU exists doesn’t preclude China from increasing their trade massively with the various member nations over the past two decades.

              As a lefty I understand why you personally can’t understand why other people and nations might like to push these types of policies but they generally lead to greater prosperity.

              • It is very cute how you think that if the agreement had its origins in the P4, it can’t possibly have been converted into a strategy to use the prospect of an FTA as the carrot dangling from the stick of geopolitical containment. But don’t take my word for it; ask the Financial Times (no lefties at the FT, right?):

                Pertinent excerpt:

                “3. It’s all about China and China knows it.

                US officials deny it. But it doesn’t take long when you are gossiping with other trade officials and experts to get someone to argue that the whole TPP exercise is really about containing a rising China. And there’s clearly some truth to that. The TPP is arguably the economic backbone of the Obama administration’s “pivot” to Asia, which in itself is all about a strategic response to the rise of China.”

                Note that the author observes that trade officials are frank about this.

                Indeed, the NY Times seems to think that not only is that the purpose of it, but that Barry skipped APEC because he is getting cold feet and backing out:


                “With the cancellation of the visits, the much-promoted but already anemic American “pivot” to Asia was further undercut, leaving regional allies increasingly doubtful the United States will be a viable counterbalance to a rising China.

                Coming after Mr. Obama’s U-turn on intervention in Syria amid signs of a new American insularity, the revolt in the House of Representatives over health care left many Asians puzzling over America’s messy democracy and wondering if the United States would be able — or willing — to stand up to China in a confrontation.

                That wariness, Asian officials and analysts say, is giving China a new edge in the tug of war with the United States over influence in Asia, with the gravitational pull of China’s economy increasingly difficult to resist.
                “How can the United States be a reliable partner when President Obama can’t get his own house in order?” asked Richard Heydarian, a foreign policy adviser to the Philippine Congress and a lecturer in international affairs at Ateneo de Manila University in Manila. “It makes people wonder: Is the United States really in the position to come to our aid in the event of a military conflict?” …. [snip] ….
                even in Japan, one of America’s closest allies, doubts were expressed about the United States’ willingness to offer backing in the event of a conflict with China over disputed islands in the East China Sea known as the Diaoyu in China and the Senkaku in Japan. The conservative government of Prime Minister Shinzo Abe has already increased the military budget, partly from fear that the United States would not come to Japan’s aid despite its treaty obligations, analysts said.”

                Now, that didn’t require delving into the lefty press, and none of those quoted in the FT and NYT articles are anything other than institutional, mainstream establishment types. So really, Gosman, you need to explain the following if you wish to give credibility to your argument: if the TPP is simply about creating a regional free trade zone, why choose to exclude China, the largest manufacturing economy in the Asia-Pacific region and end-destination for massive amounts of commodity and agricultural exports which most of the countries in the region have come to rely on as a key trading partner?

              • “As a lefty I understand why you personally can’t understand…..”

                A great moment as Gosman uses bad grammatical structure to declare himself a lefty.

                • Me also no speakie de English two good, but some of this syntax is as bad as a tax on sin…

                  “doesn’t preclude*[sic] China from increasing their trade massively with the various member nations over the past two decades.”

                  …*me tinkee could bee “hasn’t precluded” .

      • China will be ‘locked out’ of using bilaterals such as with NZ and Peru, and the FTA with Asean (and its proposed Asean+3) to give it economic advantage over the US. The TPPA is designed by the US to trump these FTAs with China to allow US corporates equal access to muscle their way into the Chinese domestic market which is the main prize. e.g. General Motors survived the GFC by producing cars in China. But US wants to be able to compete on equal footing with Chinese SOEs. They are the real target here. Hence the pressure will be on China to open up to all the parties of the TPPA now an instrument of US economic power.

  5. Personally Chris I love your work.

    But Chris, I think you have got it badly wrong on this one.

    The most God awful part of this agreement and the NZ enabling legislation needed to enact it, is as Paul says it entails giving big multinational corporations like Phillip Morris, (as an example), the right to sue any future government if they pass legislation that costs them to lose cigarette sales and profits. The international court that will judge this matter is to be staffed by ex-financiers and executives of these very same big companies.

    Are you really prepared to give up New Zealand’s sovereignty just to get access to the Japanese agricultural market?

    I also see that access to US the most protected international agricultural market of all, is off the table.

    I hope that Jane Kelsey takes the opportunity to make a right of reply. I am sure that you would appreciate her critique of your reasons why you think we should support this deal.

  6. If we truly want to make money off the land. We share no border. Go organic, Long term it pays better cost less to manufacture.

  7. How does climate change impact on your theory that NZ should import its farming techniques? Intensive dairying is oil dependent. We have to move away from oil based economy if we want a reasonable chance of limiting climate change magnitude and impacts. What do we have to export then?

  8. There is certainly an opportunity for NZ to cash in on the situation in Japan (and more to be sure), but at what cost? With the agreement being discussed in secret it is impossible to conduct even the most basic of cost/benefit analyses. Given that only 5 of 29 chapters of the agreement are trade-based, the need for secrecy is questionable to say the least.

    I appreciate the article, but I think there is much left wanting in discussing the broader picture – particularly that it is possible this agreement will be signed in by a government on the way out (sense prevailing), knowing full well that it cannot be altered in the slightest without the consent of all other signature nations, and damned be the vox populi.

    I wonder, will the author be responding to any comments? I note Marama Davidson’s recent article in response to Bob Jones, where she replies several times – something I have found wanting in many other articles on the site, particularly in the most serious of conversations.

  9. New Zealand agriculture’s long-term prospects lie in a shift away from the fossil fuel intensive industrial agriculture model, not seeking to make short-term gain from exporting it. As a counter to this model there is growth in small farmers, farmers markets, organic and biological farming. Add farm foresters into the mix, the growth in demand for manuka honey, current work on trees for bees, work by the past Parliamentary Commissioner for the Environment on topics such as ‘Weaving resilience into our working lands’, and on it goes. We have the ingredients for a shift away from the industrial “Business as Usual” agriculture model. We need to be investing in developing more resilient agriculture systems that will be sustained over multiple generations for the benefit of our ecology, social well-being and economy.

    This is not some green utopia. It’s going to be increasingly a necessity with the unfolding effects of climate change, on-going global population growth, increasing resource conflicts and food shortages. The sooner we start shifting our thinking the less painful (and costly) the transition towards resilient, high value, agriculture systems. We’re not going to get to this with free trade agreements. We simply need to start being a lot smarter than we have been over the last 150 years and get ourselves out of the pioneering, post-industrial revolution, mentality that has dominated our agriculture since our British forebears came and slash and burned to create grass for protein production.

  10. Were you at the Jane Kelsey, wayne Mapp debate on the TPPA Chris?

    Can we expect a break down?

    Thanks to the efforts of Lynn Prentice and his partner Lyn There is a video record to help you if you need it.

    Lyn will be filming (yay!) so I told her to expect about 2 hours. Lprent

    Excellent! Great news about the filming. Thanks to Lyn. karol

    Yeah. We won’t stream (this has all been a bit last minute). Got permission from participants yesterday and Lyn generously volunteered her time and some gear (with a bit of pushing)

    I’ll transcode, edit (with a bit of help), put up for participants to view, and hopefully have available for general release during the weekend. Lprent

    Yay team Left!

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