自民農協改革案 全中の指導体制温存を許すな

The Yomiuri Shimbun
JA-Zenchu structure must not emerge unscathed from LDP reform plan
自民農協改革案 全中の指導体制温存を許すな

How can the JA Group of agricultural cooperatives be drastically overhauled to reenergize Japan’s farming industry? This reform process is about to face a moment of truth.

The Liberal Democratic Party has completed its agricultural reform plan. The centerpieces of the plan are revamping the leadership of regional agricultural cooperatives, which is currently concentrated in the hands of the Central Union of Agricultural Cooperatives (JA-Zenchu), and shifting JA-Zenchu’s structure to a new setup.

In response to criticism that the group’s all-encompassing administrative leadership has sapped the motivation of producers, the LDP’s plan would restrict JA-Zenchu’s role to collating the wishes and purposes of agricultural cooperatives, as well as liaising and coordinating among them.

The reforms aim to end JA-Zenchu’s excessive intervention into the affairs of regional cooperatives, and promote the switch to a more “proactive” form of farming that gives greater play to the self-initiative of farmers. We think the direction of the plan makes sense.

The LDP plans to solidify details, such as the group’s new structure after the JA group reviews its organizational makeup, and revise the Agricultural Cooperatives Law and other laws during next year’s ordinary Diet session.

However, it is disconcerting that essential elements of the reforms remain undecided.

Last month, the government’s Regulatory Reform Council proposed that JA-Zenchu be abolished. JA-Zenchu vehemently opposed the idea, stating the move would “lead to the dismantlement of the JA Group.” We cannot escape concerns that the LDP reform plan could be watered down due to such fierce backlash from JA-Zenchu.

Actions must eclipse titles

One idea being floated was to change JA-Zenchu’s status from a corporate body based on the Agricultural Cooperatives Law to a general incorporated association. But simply changing its status while it retains powerful influence over regional agricultural cooperatives will not improve the effectiveness of the reform.

It remains unclear how the LDP will handle JA-Zenchu’s levy system, through which ¥8 billion is collected annually for operating expenses from agricultural cooperatives and other sources nationwide.

We think legal revisions should be made to abolish this collection system for vast sums of money that, along with JA-Zenchu’s extensive administrative authority based on the Agricultural Cooperatives Law, form the base of its power.

In the reform plan, the LDP said it would “positively consider” converting the group’s National Federation of Agricultural Cooperative Associations (JA Zen-Noh), which runs a shipping and sales network for products grown by farmers, into a stock company.

It is a reasonable objective to support closer ties between JA Zen-Noh and companies through such means as mergers and acquisitions as well as expanding their operations through diversified capital procurement.

Steadily implementing reforms in areas other than the cooperatives will also be needed. The LDP plan included a call to raise the cap on business investment in agricultural production corporations from “25 percent or less” to “less than 50 percent.”

About 400,000 hectares of arable farmland in Japan has been abandoned, an area equivalent to all of Shiga Prefecture. We expect the involvement of more companies in agriculture will result in more effective use of farmland and more efficient management of the farming industry.

Negotiations on the Trans-Pacific Partnership free trade deal are within grasping distance of a major agreement. The nation cannot afford to put off strengthening the competitiveness of its agricultural sector. Japan must quickly implement agricultural reforms that reward motivated farmers.

(From The Yomiuri Shimbun, June 11, 2014)

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