Feasibility Study of a Free Trade Agreement between Japan and ASEAN, and Quantitative Analysis of Economic Impacts on Agricultural Sector

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Agriculture in East Asian countries, including ASEN, Japan, Korea, and China, has several common characteristics such as small-scale rice farming, and it is important for these countries to jointly establish an international food trade rule which enables their agricultural sustainability in the future against the severe free trade pressure from exporting countries with large-scale farms. Forming an East Asian Free Trade Area is a way to strengthen cooperative relationships among these countries. However, there are still huge differences in agricultural productivity among these countries. Therefore, we should seek possibilities of a common agricultural policy that adjusts imbalance of FTA gains among the countries by creating a common fund collected in proportion to the GDP level of each country just like the EU budget. We proposed a systematic model to examine the feasibility of such programs considering combination of self-sufficiency rate of rice supply, budgetary constraints, reduction limit of rice tariffs, and nitrogen balance.