Record of An Exchange Tour for Observation of Japanese Strategic Alliance and Co-prosperity Model for Regional Revitalization

1.Foreword

Taiwan’s Agriculture and Food Agency Director General Hu Jong-I led a staff of seven members to visit Japan during June 4-8, 2023 for observation of the strategic alliance and a co-prosperity model specifically for boosting regional revitalization in Japan as well as exchanging viewpoints concerned. The study covered topics including vegetables/fruits produced in Japan and Taiwan, regional revitalization, strategic alliance, healthy lunches for schoolchildren, local production for local consumption, wholesale trade appointment system, while exchange of viewpoints focused on market supply and demand. Meanwhile, the tour is intended to refer to Japan’s experience in promoting “regional revitalization” policies, understand how agricultural enterprises, farmers and local associations in Japan mutually cooperate and closely link with local industries for vertical and horizontal connection to form a resilient local commercial ecosystem that causes local changes and drives local economic development toward industrial co-prosperity and sustainable development. This article lays emphasis on promotion of regional revitalization by virtue of strategic alliance as a referential basis for Taiwan to strengthen resilience and responsive capability for industries in the future.

2.Japan’s regional revitalization policies vs Taiwan’s

Faced with diminishing population, excessive concentration of population in large cities and imbalance between urban and rural development, the Japan government came up with Japan Revitalization Strategy on December 27, 2014, and formulated the regulations concerned as well as set up local promotion offices in the same year. With reference to Japan’s practical experience, Taiwan positioned regional revitalization as a national policy at the level of national security strategy and formulated “Taiwan’s Strategic Plan for Regional Revitalization”, with the plan coming into effect in 2019 in the five aspects: enterprise investment in homeland, introduction of technologies, integration of interdepartmental revitalization resources, social participation in revitalization, brand building. Unlike the policy model that the central government directed implementation of plans in the past, the plan is being executed upward “from the bottom level to the top one”. First, development consensus is formed at the local level, then the central government offers needed resources to set up complete regional revitalization ecosystems in a bid to revitalize physically deteriorating towns or rural areas to reach the goal “balancing Taiwan”. In 2020, COVID-19 pandemic negatively impacted governance, economic operation and patterns of social activities in Japan. Fumio Kishida, since he assumed the Japanese prime minister in 2021, has proposed the “Comprehensive Strategy for the Vision for a Digital Garden City Nation” to bolster up regional revitalization with “population concerned,” “digital fields,” and “sustainable development goals (SDGs) business” based on regional revitalization and Society 5.0 policies. The Kishida administration announced “Basic Policies for the Vision for a Digital Garden City Nation” in June 2022, which aims to hike living convenience and comfortableness for Japanese people through application of technologies. This is intended to reduce the gap in urban and rural development as well as mitigate crises arising from low birth rates and increasingly aging population, thereby making Japan a nation featuring “everyone can live conveniently and comfortably”. Increase in “population concerned” and free mobility of people are key to supporting local economic development to generate consuming capability and economic vigor. Through efficient integration of resources, different stakeholders are motivated to inject their resources for jointly creating values.

3.Public-private cooperation converts “liability resources” into “resources available for revitalizing regions”

Kasama City in Ibaraki Prefecture, located in central Japan, has been faced with living and economic challenges due to diminishing population and aging population, and COVID-19 pandemic has aggravated the problems. In particular, “Comprehensive Strategy for the Vision for a Digital Garden City Nation” launched in Kasama City aims to realize Society 5.0 goals and SDGs through making diversified employment environment and reusing existing idle facilities as new business operating places which, via cooperation between the city government and farmers or farmer associations, capitalize on the city’s characteristics to create “appealing charm” and thereby generate “income”, a bid to create new local value through converting “liability resources” into “resources available for revitalizing regions”. In response to the impact of COVID-19 pandemic, the city government has boosted citizen cooperation in order to diversify and digitalize operation to provide new services and bring about brand-new business opportunities. The observation tour included visits to shopping street beside Kasama Inari Shrine, Kula garden cafe, Ibaraki private sports group, Kasama New Village. Kasama Inari Shrine is one of the three largest Inari Shrines in Japan. In front of Otorii Gate (the main entrance gate) of the shrine is a shopping street alive with stores of local produces and souvenirs. In order to develop local tourism, the city government in 2016 began to offer regional revitalization subsidies and cooperate with the parties concerned to remodel originally idle buildings along the street into stores and decorate them with chrysanthemum to link with the chrysanthemum floral festival held in the city. Besides, pottery art “Kasamayaki” is displayed at stores in combination with the floral festival to demonstrate the city’s local attractive features, a move to inject cultural and innovative atmosphere into the originally old street so as to tout tourists. Diagonally opposite Otorii Gate, Kula garden cafe is a store of fashionable style through remodeling a liquor warehouse of some 100 years of age. Being a coffee shop and a bar as well, Kula provides some food made of chestnut, a local agricultural product, in a bid to help local chestnut farmers. Ibaraki private sports group has revitalized unused buildings and facilities in an abandoned senior high school as a gathering place for local baseball teams. In order for continued operation and development, the group links itself with local production of chestnuts through self-operating Kasamarron Cafe to sell food of processed chestnuts and hire physically or mentally disabled people for processing chestnuts, a bid to secure stable supply of needed labor and prompt local economic development. Based on the concept of sports, health and local welfare, the group has created brand-new value and made substantial contribution to the local society via “welfare x sports x education”. The Kasama City Government, based on its “agronomy and pottery art in harmony” project as a theme and according to approval from the central government, in 2002 promoted Kasama Kleingarten, an “accommodating citizen garden” consisting of 50 residential facilities, agricultural experience area, agricultural product stores and restaurants. In order for efficient financial defrayal, the city government in April 2022 cooperated with MyFarm to set up Kasama New Village, an agricultural theme park featuring “experience farm”, “agricultural school” and “production, channels, sales” mechanism provided for consumers. Based on the concept of local production for local consumption, development of Kasama New Village is oriented to an experience farm that provides various services related to agriculture and food to interlink agricultural production activities as a cycle in a bid to realize the closer human-nature relation - “a society characterized by self-production for self-consumption”. As the Japan government offered subsidies to encourage people to move from the Tokyo metropolitan area to live, work or establish businesses in cities or towns with smaller population, small cities in Ibaraki have witnessed increased population. During COVID-19 pandemic, digitalized transformation and diversified operation as well as short-term office rental schemes for remote working have led to increasing “population concerned” moving from Tokyo to cities in Ibaraki, with such people likely to reside there later.

4.Develop field-based local economy, expand channel fields of agricultural products

Local production for local consumption is an important development strategy for regional revitalization, while injection of enterprises’ resources and establishment of business mechanisms are key to sustainable development. There are 1,204 “roadside stations” established around Japan to provide rest areas for car drivers or passengers, display relevant information, expand agricultural product marketing channels, and, in particular, become a platform of local thematic brands symbolic of local characteristics. Through building local brand values, field-based economy is formed to realize regional revitalization. As Kasama is a main production site of chestnuts in Japan, the city government offers support to producers and processing undertakers of chestnuts as well as collaborates with chestnut downstream producers, cake/sweet food distributors and restaurants to promote the “Kasama chestnut” brand in a bid to set up a stable supply chain for chestnut materials (such as chestnut paste, kanroni, boiled chest nuts). Opening in September 2021 and near a freeway ramp, “Kasama roadside station” consists of a coffee shop appealing by Kasama chestnuts, stores of fresh local agricultural products and souvenirs made of such products as well as an eatery square appealing by local food materials to particularly promote Kasama chestnuts. In addition, design of the station is characterized by fusion with image of chestnuts and there is an exhibition room of Kasama pottery art to enhance recognition of the Kasama brand. Chestnut materials are produced by a joint-venture manufacturer established by the Kasama City Government, East Japan Railway Company Mito Branch and Hitachi Agricultural Cooperative, while a municipal agricultural community cooperates with private enterprises to develop various food items of processed chestnuts to build “Kasama Chestnut” souvenir brand to create new local value. Under guidance by the Kasama City Government, Kasama roadside station and the chestnut material manufacturer have combined to make up a field to integrate production, processing, product manufacturing, channels and retail sale via geographic connection. Public-private cooperation is expected to expand the Kasama chestnut market, promote the Kasama chestnut brand value, create new local charm by means of Kasama chestnuts in order to develop local tourism and drive field-based local economic development. Joso roadside station, opening on April 28, 2023, is near Joso ramp of the central freeway and the 16th one of roadside stations in Ibaraki. There are agricultural products as well as fish and meat products available for sale at the station, with over 70% of these products supplied and priced by local farmers. Besides, there are products with local characteristics available for sale only at roadside stations, such as items of processed cantaloupes and sweet potatoes. Through PPP (public-private partnership) partners’ participation in a “concept of agricultural technology valley”, Joso roadside station is combined with “Granberry Daichi”, the largest aerial strawberry cultivation system in Japan, “Tsutaya Bookstore” and planned hot spring facilities to make up an industrial park which functions as the local industrial/economic core. With “food, agriculture and health” as a theme, the industrial park, in addition to integrating production, processing, channel distribution and retail sale, introduces experience-based activities to transform previous purchase-oriented consumer behavior at roadside stations into current experience-oriented consumer behavior. By so doing, the industrial park not only provides consumers with multiple choices to enhance local attractiveness but also increases possibility of consumers’ recurrent visits to contribute to revitalization of the local area. Also close to a freeway ramp, Kasama roadside station houses a coffee shop appealing by Kasama chestnuts, stores of fresh local agricultural products and souvenirs made of such products, an eatery square appealing by cuisines made of local food materials. In addition, design of the station is characteristically in fusion with image of chestnuts and there is an exhibition room of Kasama pottery art to enhance recognition of the Kasama brand and create the brand value. Chestnut materials are supplied by a joint-venture manufacturer established by the city government, East Japan Railway Company Mito Branch and Hitachi Agricultural Cooperative. The manufacturer is responsible for primary processing of chestnuts (such as making chestnut paste, kanroni, boiled chestnuts) for supply to sweet food producers, restaurants and coffee shops inside and outside Kasama City, with the main purpose of building the “Kasama Chestnut” souvenir brand and creating new local value. In particular, the manufacturer aims to “increase chestnut farmers’ income”, “expand the Kasama chestnut market”, “raise Kasama chestnut brand value” and “create content of tourism by means of Kasama chestnuts”. Under guidance by the Kasama city government, Kasama roadside station and the chestnut material manufacturer collaborate to form a local industry-specific ecosystem via public-private cooperation and based on the regional revitalization. Hooking up with the image of local brand, the ecosystem pushes up exchanges among different industries to drive field-based local economic development and is committed to creating new local charm and prompting sustainable operation and development for industries.

5.Strategic alliance for cross-domain cooperation to reach multiple wins with co-prosperity

Taiwan Sweet Potato Industry Alliance together with the staff on June 7 visited the sweet potato association under JA (Japan Agricultural Cooperative) in Namegata City as well as observed practical promotion of production, processing, preservation, distribution, retail sale and consumption of sweet potatoes by villages in the city. JA Namegata Agricultural Cooperative (JA in Namegata City) makes efforts to maintain economic stability for farmers, enhance efficiency in and quality of agricultural production, promote processing and sales of agricultural products and develop agricultural tourism through cooperation and mutual assistance among all parties concerned in a bid to vitalize local agriculture and boost local agricultural development and sustainability. The sweet potato association under the JA Namegata Agricultural Cooperative is an organization of producers composed of 286 participating farmers, with operation beginning in 1998 and intended to increase farmers’ income. Based on consideration of retail sale and consumers’ demand, the association has adjusted its distribution methods and sales channels as well as cooperated with research organizations in order to maintain stable supply of high-quality sweet potatoes. According to Hirohito Kuriyama, Horticulture Section Chief and examiner for JA Namegata Area Center, preservation technology is crucial to freshness of sweet potatoes and it is necessary to store the product at fixed temperature of 14˚C and humidity of 90% to ensure high quality for shipments anytime. Therefore, enhancement of the preserving performance is relatively important. Based on JA statistics, there were 14 sweet potato warehouses equipped with temperature and humidity control capability in Japan in 2015, with total storage capacity of about 5,000 metric tons. For promotion of sweet potato chain from production to consumption, Namegata Framers Village is a commercial agricultural-experience park and, more precisely, a “sweet potato theme park”. Shirohato Group, a Japan-based food processing company, deemed that development of agricultural theme parks would be the best way of promoting agricultural products. Therefore, the company has been in strategic alliance with Namegata City Government, agricultural associations and organizations in the city to operate Namegata Framers Village. The site of the theme park was acquired through consolidating the site of an abandoned school and surrounding idle farmland, with the land size equivalent to that of seven Tokyo Domes (more than 300,000 square meters).

For operation, the theme park makes producers/suppliers in the entire food supply chain and consumers get together by providing safe food materials and offering DIY curriculums to take root in agricultural knowledge and realize corporate social responsibility.

6. Regional revitalization and realization of SDGs

To cope with UN’s adoption of SDGs in 2015, the Japan government set up SDG Promotion Headquarters in May 2016 and decided on “SDG Implementation Guiding Principles” in December 2016, and in December 2017, “Comprehensive Strategy for Towns, People and Work Revitalization” was decided by Japan’s Cabinet which expressly indicated that promotion of SDGs was essential to realization of regional revitalization. Japan announced “SDGs Action Plan 2020”, with “promotion of regional revitalization by means of SDGs” being one of the three main focuses. With sustainable development goals as the driving power, Japan is developing resilient, environmentally-friendly and attractive towns to specifically boost regional revitalization. In view of the impact of climate change and COVID-19 pandemic, Japan and Taiwan have striven to promote “regional revitalization” policies and, among the 17 SDGs of the United Nation, the SDG 11 Sustainable Cities and Communities” emphasizes the importance of making cities inclusive, safe, resilient and sustainable. Japan-based Yanmar Group manufactures engineering vehicles, agricultural machines, diesel engines and small vessels for own-brand sale. The company is committed to solving clients’ problems in the fields of food production and power generation through using technologies to create new values. “Hanasaka” is the company’s core concept and starting point, standing for nurture of human being and future. Yanmar aims to create sustainable future based on the four visions: “an energy-saving society,” “a society where people can work and live with peace of mind,” “a society where people can enjoy safe and plentiful food” and “a society that offers exciting life filled with rich and fulfilling experience”. Yanmar owns a building near Tokyo Station and sets up Yanmar Tokyo commercial complex on the first and second floors. As one of Hanasaka projects, Yanmar Tokyo focuses on paddy and agriculture. Rice is the essential food in Japan and the core of Japanese cuisine and culture. With paddy and rice as a theme, many stores and restaurants at Yanmar Tokyo use interactive galleries and digital technology to provide consumers with information on food and agriculture as well as history, current conditions and future development potential of paddy planting, a bid to show the charm of “rice” via exhibition, experience, meals and specialty product. Relative to SDG, enterprises give more importance to ESG (environmental, social, governance). UN Global Compact in 2004 initially proposed ESG concept, leading to adoption of ESG as indicators in evaluating enterprises’ operations. For organizations or local areas, ESG helps them explore and dig out additional values from existing operational models or products/services as well as find ways of environmental and social coexistence and co-prosperity. Through introducing the concepts of ESG and social common good, enterprises can link with start-up ecosystems to develop flexible cooperative models in a bid to effectively enhance the operational efficiency. By virtue of main strategies of “multiple channels of inviting proposals,” “setting up local young talent cultivation stations” and “revitalizing buildings and facilities owned by the public sector” in 2021, Taiwan has been speeding up promotion of regional revitalization. Through introducing concepts of ESG and social common good, the government makes efforts to strengthen the local industries, lays emphasis on sustainable development of local culture and environment and, in addition, offers occasions for local enterprises and locally founded start-ups to take part in local affairs so as to let them mutually benefit and coexist in a bid to bring about opportunities of local revitalization.

7. Conclusion

The spirit of regional revitalization policies and the concept of enterprise ecosystems in Japan complement each other. It is necessary to find core leaders or enterprises able to drive local development, propose anticipated value arising from local development, create feasible business models, link local stakeholders in a bid to make ecosystem participants’ interests coincide with purposes of local development to attain the sustainable development goal of symbiosis and common sharing of benefits. Alliances, based on business models and through “localized” industrial networks, economic models as well as the entire supply chain from production to consumption, can vitalize local economic development and, under cooperation among enterprises, farmers’ associations and local industries, enhance the resilience of industry chains to help them cope with risks more quickly. Particularly for Taiwan, ESG is a direction of corporate sustainable development and the sustainability target for development of alliances as well as a thinking and cooperative model for developing agriculture toward different areas. Similarly, regional revitalization begins from connection between people and local areas and aims at local sustainable management. By virtue of strong organizational resilience and industrial development closely connected with local areas, a self-sufficient and resilient regional commercial ecosystem is being gradually formed through vertically and horizontally setting up networks to cope with various risks and crises as well as steadily fulfill sustainable development visions and have local areas in sustainable development.

Source of the article: Agricultural Policies and Conditions monthly (Issue No. 374) published by Ministry of Agriculture.