TOKYO, OSAKA, YOKOHAMA— the names of these great cities are familiar throughout the world as symbols of booming, industrial Japan. Very few people outside Japan, however, have ever heard of a township called Naka-Shibetsu, which is enjoying a different kind of boom, far away from the smoking, hustling cities of the island of Honshu. Naka-Shibetsu is on the eastern coast of the snow-capped northern Japanese island of Hokkaido. It is minuscule in relation to Osaka and Yokohama. And its growth and upsurging commercial activity are only indirectly connected with the great industrial drive of the south. But Naka-Shibetsu’s success is nonetheless important to Japan, and to other countries of Asia as well.

Japan’s Drive in Agriculture

Naka-Shibetsu’s little boom is the product of a new drive in Japanese agriculture, much less spectacular than the revolution in industry, but in the long run, perhaps, not much less signficant. It is the product of a new national effort to end a duality in the Japanese economic structure—the contrast between a system of heavy industry as modern and efficient as anything in the world, and an agricultural structure still struggling to keep pace with the economy as a whole.

A few miles outside Naka-Shibetsu township, at the top of Kayodai Hill, the prospering townspeople have erected a lookout kiosk and set up a rotating telescope holder, and from here you can look out, on a clear day, around a vast, 270-degree horizon. To the east, rising from the mists of the sea, you will see a mountain top at the southern tip of the Kurile island chain. To the west looms Mount Mashu, in the Akan Ranges, with long fingers of spring snow drifting down its sides, like strips of white paper on a blue party hat. Between the two stretches the wide, high prairie of Konsen. It is development that has taken place on this misty, wind-whipped plateau in the last 11 years that is largely responsible for the conversion of Naka-Shibetsu from a scruffy backwoods village to a thriving, modern country town.

Eleven years ago a great part of the Konsen plain was virgin country, wild and forbidding, inhabited by bears and the wild horses that are the legacy in Hokkaido of ancient efforts to use the island as a breeding ground for Samurai steeds. In modern industrial Japan the Konsen prairie had remained largely primeval, despite repeated efforts by the Government to have people move there and open the land to livestock and crop raising. The Japanese farmer, used to the warm rice paddies of the south, found the northern winters grim and the soil of the plateau unrewarding. Most of all, he found that axe and plow and animal power were weapons too weak to clear the land of forest and so allow him to pursue settled farming. Even as late as the 1950’s, much of the great Konsen plain was still given over to a primitive, shifting agriculture.

Today, the dominant theme in the view from the lookout is that of ordered settlement. In the foreground a television tower rises from the side of Kayodai Hill, and from the middle distance comes the sight and sound of a 60-horsepower tractor crossing an open field. Red roofed barns and glint of metal milking sheds scatter the landscape, and ordered windbreak lines of spruce and larch bend and rustle in the wind. In the fields, black and white Holstein dairy cows graze the crops of timothy grass and rye. From a farmers’ village school farther out the breeze catches and carries up the crack and shout of children playing baseball.

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Japan with Enlarged View of Hokkaido

Citation: Finance & Development 3, 004; 10.5089/9781616352844.022.A003

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World Bank Cooperates

How was this extraordinary transformation brought about in just 11 years? In the face of earlier frustration and so much wasted effort, how was the view from Kayodai Hill so effectively changed? Part of the answer is the changing food demands of the prospering Japanese city dweller. As he achieves better living standards, he moves away from the traditional rice diet toward high-protein foods—meat, milk, cream, butter, and cheese—the kind of foods the Konsen lands are suited to produce. But the main reason for the change is an imaginative scheme of the Japanese Government carried out in cooperation with the World Bank.

In the early 1950’s the Japanese Government examined the structure of its agriculture and the composition of its imports. It noted that a disturbingly large and increasing proportion of its foreign exchange was being used to import basic foodstuffs. It decided that unless Japanese economic growth was to be retarded by pressure on the country’s balance of payments, it would need to do something about domestic agriculture, and it asked the World Bank for advice about what it might do.

The Bank, among other things, recommended an increase in farms devoted to livestock, particularly dairy cattle, to meet the changing pattern of demand. It endorsed Japanese ideas of land reclamation and of promoting the pioneering settlement of areas that were remote and undeveloped but which had productive potential. But it suggested that both the reclamation and the pioneering could be made a great deal more effective by large-scale mechanization. To this end it suggested the setting up of a mobile, specialist body.

In 1955 the Japanese Government established an organization called the Agricultural Land Development Machinery Public Corporation (now officially abbreviated to AMC). In 1956 the World Bank extended a foreign exchange loan to this corporation to help to finance the purchase of reclamation and development machinery which it needed but which was not yet available from local Japanese sources. One of the first tasks allotted AMC was to begin carving 48-acre farm blocks out of the wild Konsen forest. AMC was to carry the establishment of these first pioneer farms to the completion of a house and barn, initial chemical improvement of the soil, the sowing of the first year’s crop, and the provision of livestock; it was also to provide a network of roads among the newly opened farms.

When the farms were in operating condition they were to be purchased by selected pioneer settlers on generous credit terms, including an initial “settling-in” period during which no repayments were due. If this first attack on the forest proved reasonably successful, then the AMC would extend its carving-out of farms from the forest. And, in the meantime, it was hoped that survivors of earlier attempts to pioneer that area of Hokkaido by axe and domestic animal power would frame plans of their own for using the power of the AMC to extend and consolidate their holdings. The legacy of these hopes is on view today from the lookout on Kayodai Hill. Much less than half the transformation of the plain is due to the original “pilot” work of the AMC. The greater part is the result of the hoped-for “impact” effect upon earlier pioneers.

Government-Aided Cooperatives

Survivors of an earlier wave of pioneer farmers, attempting to win the land by hand and animal power, had been scattered over a wide area around the Konsen district for a number of years before AMC reached the scene. Like farmers everywhere in Japan, these earlier pioneers had formed themselves into cooperatives—institutions which are basic to an understanding of modern Japanese rural society and the Government’s policies toward it. (The cooperative is a government-nurtured organization of farmers, combining roughly the functions of a trade union, bulk purchaser, marketing agent, tax collector, savings and loan society, commercial and development bank, and ultimate arm of local government. In the wealthier farming areas it is not uncommon for these cooperatives to employ staffs of up to six or seven college-graduated experts.) Impressed by the initial “pilot” farm achievements of AMC, the older pioneer cooperatives of the region investigated and found the Government willing to help them pay AMC to extend existing holdings into virgin country, to consolidate scattered clearings, and to open new land for the younger generation.

To this day, although AMC’s main task force has long ago moved to newer challenges, about 40 of its operators are still kept busy carving into what remains of the Konsen bush on negotiated work for the cooperatives of both the older and newer pioneers. This process of direct negotiation between the mobile AMC and the farmers’ cooperatives has allowed AMC to assist the renovation and commercialization of Japanese agriculture over a very large area, both in Hokkaido and on the heavily industrialized island of Honshu.

The Dynamics of Changing Demand

Statistics compiled by the Japanese Ministry of Agriculture and Forestry show something about the dynamics of this boom in dairying and livestock raising. Since 1955 Japanese consumption of milk and milk products has more than tripled, from 12.1 kilograms a person in 1955 to 37 kilograms a person in 1964. Over the same period consumption of cereals, including rice, has actually declined slightly from 155.2 kilograms a person in 1955 to 147.4 kilograms in 1964. Meat, milk, and eggs, which accounted for 10 per cent of household food expenditure in 1955, claimed 18 per cent in 1964. In comparison, the proportion of total expenditure going to rice has declined from 28.3 per cent in 1955 to 17 per cent in 1964. This marked switch in the composition of a rapidly growing total food demand is, of course, the direct product of expanding affluence—and comparison with the dietary habits in Western countries such as the United States, the United Kingdom, the Netherlands, and Denmark suggests that the process has still some considerable distance to run in Japan.

To meet this demand, the dairy and livestock industries in the underutilized northern island is growing at an extraordinary rate: from an estimated 50,000 head of cattle in Hokkaido 20 years ago, the total is conservatively expected to reach 600,000 head by 1970. Of the marked increase in dairy production thus occuring, more than three fourths is now being shipped to Tokyo and other southern industrial cities. This export surplus will grow rapidly in the years immediately ahead.

Agricultural Machinery Corporation

The modern pioneering role of the AMC in this upsurge of production, though difficult to assess precisely, clearly has been substantial. Its success has depended to a large extent upon its ability to communicate with the farming community and to use and increase the variety of mobile equipment, ranging from dump trucks to swamp dredgers, with which it was originally endowed in 1955. At that time it was given three development and settlement projects. One was the conquering of the Konsen plain, another was a similar kind of forest-taming operation on the Kamikita plain at the northeastern tip of Honshu. The third was the reclamation and reconstruction of 30,000 acres of low, water-logged peatland beside the great Ishikari River in the Shinozu district on the western side of Hokkaido.

Each of these projects has had its impact on Japanese agricultural efficiency and on Japan’s ability to produce goods that were formerly imported. Each also has contributed invaluably to the acquisition of a stock of technical expertise and experience which has made the 11-year-old AMC an increasingly valuable asset to Japan. But each, too, has involved the adventure of people transplanting themselves, and turning virgin soil for the first time. Who are these pioneers, where had they come from, and how have they fared? A significant proportion were victims of the sharp and sudden elimination of Japan’s overseas territories in the war. They were Japanese farmers, technicians, and teachers who had settled before World War II in such overseas territories as Manchuria, Sakhalin, and the Kuriles. In the late 1940’s and 1950’s they found themselves impoverished refugees back in the homeland.

A representative family on one of the more recently cleared (1961) Konsen pilot farms is that of Tsutomu Ogasawara. He lives with his wife, his high school daughter, 13, and his primary school son, 10. In 1945 Mr. Ogasawara and his wife and a 4-year-old daughter had been caught by the advancing Soviet Army in Manchuria. They were taken to an area near the Russian-Manchurian border where Mr. Ogasawara was sent to work in a coal mine and his wife was ordered to work in a hospital. They remained there for 8 years; during this time their daughter died of malnutrition.

In 1953 Mr. Ogasawara and his wife were repatriated to Japan. After working for a time in Tokyo, he went to Aomori prefecture in Honshu to learn the dairying industry. In 1961 he applied for, and received, a newly opened Konsen pilot farm. He has prospered. He has his motorcycle, his television set, his radio, his electric stove, electric washing machine, electric milking machine, and propane gas water heater. Even so, he does not yet represent the most prosperous group of Konsen pilot farmers. The group who arrived in 1956 have had more of a chance to become established, and have larger, brighter barns, taller fodder silos. Some own tractors and trucks, and some even own cars.

Some Failures

Of course, there were setbacks, difficulties, failures. Jersey cattle imported from Australia for the settlers—on World Bank advice and with World Bank finance—have been, in the opinion of the settlers, less than a success, although the Japanese are politely indefinite about this. In the Konsen area approximately 160 of these cattle turned out to have a disease called brucellosis, previously unknown in the region. In any event the Japanese Government’s formula for supporting the price of milk tends to make the Jersey a less inviting proposition to these farmers than the traditional black and white Holstein (which produces less butter fat but more milk). The Jersey cattle population of the Konsen region is actually declining at the same time as total cattle population is rapidly rising. Some farmers, saddled with the task of repaying loan money for Jersey cattle, are resentful.

In Konsen, too, it is clear enough now that the original individual 48-acre pilot farm areas, estimated in the early 1950’s as sufficient to give the farmers a fair income relative to what they might expect to earn working for wages in the city, were not big enough. In 1954 and 1955, no one could have foreseen the miraculous growth that would occur in the Japanese industrial economy over the decade, a growth which has almost doubled the level of real wages in Japanese manufacturing industry since that time. In its later work, the AMC cut bigger blocks; but this was no compensation for locked-in original farmers. It was left to that remarkable example of Japanese institutional adaptability—the farmers’ cooperative—to help to provide the answer. The cooperative undertook to acquire the blocks of less successful pioneers who wanted to leave for jobs in the cities, and to apportion the land and the debt evenly so that as many as possible of those that remained could prosper on something like city standards. About 50 families have left Konsen, and their land has been divided among the remainder.

The aim now for the Konsen area—as for newer livestock land development projects, based on the Konsen experience, in which the AMC is engaged in other regions—is an average farm size of about 92 acres. Of this area, about 54 acres would be sown to pasture, 29 would be left unsown, about 9 would be left as forest to allow for future expansion, and about half an acre would be used for the farmhouse and outbuildings.

In an economic and social structure changing as rapidly as that of Japan it was inevitable that time should reveal some errors in human judgment in long-term planning for land settlement. Fortunately, Japanese administration has been skillful and flexible enough to keep adjusting. And today—11 years after the Japanese Government first launched its experiment—its strongly capitalized, mass production land pioneering push can, on balance, be judged a fair investment. The great majority of pioneers established on government initiative are now well settled. Lives broken in midstream by war in distant territories have been rebuilt. Net incomes of most of the settlers have risen much faster than expected, and are now about the national farm average. Moreover, they are founded on a basis that should allow the farmers to hold their place in the growing national prosperity.

But more important probably than settlement by government initiative has been the impact of the mechanized pioneering on the already existing conservative farm communities. Great swaths of country have been transformed by now under the stimulus of example—sometimes from virgin forest, probably more often from the consolidation and tidying up of haphazard, patchy land into neat settings for mechanized, commercial agriculture.

Not the least important of the results has been the establishment of the AMC itself, and its contribution to the continuing task of commercializing Japanese agriculture and of expanding and diversifying the domestic food supply. Proving itself—like, the farmers’ cooperatives with which it has worked so closely—a classic example of Japanese creative adaptability, it has substantially expanded its function and more than doubled its size. From the original three experimental projects, AMC now has a total of 200 under way throughout Japan—ranging from relatively small-scale tidying-up contracts for farmers’ cooperatives to big national land reclamation ventures. Operating under the constructive supervision of the Ministry of Agriculture, it has drawn high-quality staff from local and central government, from public utilities, and from private industry. It has now a permanent staff of more than 500 civil, mechanical and agricultural engineers, machine operators, mechanics, and administrators. It operates more than 500 different items of construction equipment and machinery. With headquarters in Tokyo, it has decentralized its administration and operating capacity to cover the whole of Japan on a regional basis, while still retaining the flexibility and mobility which allow regional governments to use it, at sudden notice, as an effective troubleshooter against the ever present threat of typhoon damage to the ricelands.

New Projects

The biggest current effort is the reclamation from the sea of the 54,000-acre Lake Hachiro, the second biggest lake in the country, connected to the Sea of Japan by a narrow channel on the northwest coast of Honshu. AMC has the job of converting the lake bed into relatively large-scale blocks of paddy-field and grazing land, suitable for mechanized farming. For this venture AMC has used its experience and staff to the full. Imported equipment designed for road work and other hard-earth projects has been adapted by corporation engineers to work in silt and boggy soil. New amphibious operations have been developed to work the earth from water surfaces.

It is likely that the more successful and more durably useful of the new pieces of equipment will become standard items of manufacture in Japanese factories.

An important change in the basic economic rationale behind AMC’s activities has occurred since it began attacking the forests of Konsen 11 years ago. The tremendous pull of Japanese industrial growth upon total labor resources has made the idea of settling significant quantities of new families on the land impracticable. More important now is to consolidate and mechanize Japanese agriculture so that fewer people can handle bigger strips of country, thus increasing the commercial efficiency of agriculture and allowing the incomes of those remaining on the land to expand in harmony with urban incomes.

Meanwhile, in the Ministries of Foreign Affairs and of Agriculture, officials are turning over the idea of expanding AMC still further, of using some of the special skills, equipment, and experience it has built up in operations within the country’s new effort in technical and economic aid to Southeast Asia. Mr. Yoshiyuki Shimokawa, Director-in-Charge of Technical Development at AMC—who came across from the Hokkaido Bureau of Development six years ago—spoke recently about the possibility of the Corporation exporting its services to Southeast Asia. He strongly favored the idea. “We want to hold our bright young men,” he said, “and many of them are desperately keen to get out there and into the job of helping development in the rest of Asia. We think they could do this best through us.”