Advancing knowledge of the genetic blueprint for life has made it possible on a commercial scale to introduce into plants and animals beneficial traits that cannot be conferred by conventional breeding techniques. The benefits of these genetically modified organisms are significant, according to the companies that are commercializing the technology. Because humankind's understanding of genetics, biology and ecosystems remains incomplete, however, some scientists and consumer groups are concerned that the unhindered introduction of GMOs into the food supply and the environment may carry latent risks and costs.
Japanese industry and government remain keen on developing new applications of biotechnology in medicine and in the environmental remediation field as well in agriculture. The Japanese public, however, has developed major doubts about the safety of transgenic foods. The growing public backlash against genetically modified products threatens to upset not only corporate commercialization plans and government research projects but also Japan's trade relations with the United States and the rest of the world. Because Japan imports a large percentage of its food and American farms are a major source Tokyo's stance on trade and regulation of gene-altered plant and animal products could have a big impact on how this issue is addressed globally.
Since the discovery that the information that directs an organism's development, sets its characteristics and controls its biological functions is encoded in a long chain of deoxyribonucleic acid (DNA) molecules, scientists around the world, and particularly in the United States and Japan, have spent years and countless funds expanding the field of molecular genetics. In 1973 and in 1974, the competition took on commercial overtones when scientists successfully created identical copies of genes called cloning and inserted foreign genetic material into a living microorganism which then activated or expressed the alien DNA, a technique known as gene splicing.
The ability to add, alter and delete genes in living cells opened up new horizons that were not possible with conventional methods of plant and animal breeding. Genetic diseases could be detected and perhaps cured. New vaccines and treatments could be developed to combat bacterial, viral and fungal attacks. And new traits could be conferred on plants and animals that could help feed a hungry world or improve its nutritional intake.
Nearly 25 years later, biotechnology has fulfilled some of its early promises but has fallen short on others. The state-of-the-art is advancing rapidly, however. The complete genetic sequences or genomes, of some insects and lower invertebrates have been deciphered, and researchers are very close to unraveling the basic blueprints for humans and certain important food grains. Biotechnology has been applied commercially in pharmaceuticals, environmental remediation and agriculture.1
Japanese industry, some segments of which have a strong understanding of fermentation the technology of growing microorganisms to produce various chemical or pharmaceutical compounds and the Japanese government have rushed hand-in-hand into the new field. This hasty and loosely coordinated effort, however, has not led to the hoped-for success. Lacking a strong foundation in basic science and handicapped by a research system that does not always encourage creativity, innovation and ground-breaking science,2 Japan has been unable to challenge the United States for biotechnology leadership.
Nevertheless, government and private researchers in Japan have made significant contributions to the field. The Ministry of Agriculture, Forestry and Fisheries, for example, is nearing the end of its rice genome project, having budgeted more than ¥1 billion ($8.3 million at ¥120=$1.00) in FY 1998 and FY 1999. A complete blueprint of the grain's genetic makeup could lead to the development of new varieties that could benefit millions of people around the globe.
Japan has played an equally important role as a market for genetically engineered products. Biotech drugs and therapies have found a ready market in Japan, although it is difficult to derive exact trade numbers since the technology has spread so thoroughly throughout the field. Japan's dependence on imported foods also has put it squarely in the center of international trade in genetically modified plant and animal products.
MAFF calculates that, overall, Japanese farmers produce only 28 percent of the food that the country eats directly, transforms into food products or feeds to animals. The United States supplies about 80 percent of Japan's soy bean imports and nearly 90 percent of its corn imports. The ministry estimates that about 33 percent of the soy beans, 23 percent to 34 percent of the corn, 39 percent of the cotton and 38 percent of the rapeseed oil imported from the United States are bioengineered.3 Exact figures are not available because Tokyo has not required genetically modified organisms or products containing gene-altered materials to be labeled. This will change for 24 categories of food when recently approved rules come into effect in April 2001.
Tokyo's proposed labeling regulations for food that contain GMOs are only the latest development in a debate that has embroiled more than 170 countries, including the United States and the members of the European Union. The debate has become heated, in part because of one-sided marketing and other missteps by companies eager to make a profit on transgenic crops, and in part because regulatory mechanisms and precedents are not in place. Both the GMO industry and the authorities are calling the plays as they go along, a strategy that has not won the trust of environmentalists or of consumer advocates.
Farmers around the world constantly are wrestling with the forces of nature, trying to grow enough food to feed the earth's expanding population. Agronomists have made steady improvement in the disease resistance, weather tolerance and yields of plants as well as animals using conventional techniques, but the developing mastery of biotechnology promises quantum improvements in several areas:
Biologists, however, have not yet bred disease-resistant livestock. Cows and pigs that produce their own antibiotics theoretically are possible, but scientists are concerned that such disease resistance may prove fleeting as bacteria and other pathogens can adapt rapidly to changes in hosts. Moreover, unlike plant diseases, many of the microbes that attack animals also are harmful to humans.
As for plants, bioengineers have focused on accelerating growth and increasing environmental adaptability. Varieties that mature quickly enough to allow two or more crops per growing season have an obvious appeal. Plants have been engineered that exhibit resistance to drought and cold as well as tolerance for salty and poor soils. Besides being less susceptible to frost or heat damage, these varieties need less fertilizer and water, which lowers farming costs. These altered plants can grow in a wider range of environments, increasing the amount of arable land and so lifting total crop production.
German researchers recently announced that by introducing three genes from unrelated plants, they had created a strain of rice that produced significant amounts of vitamin A. They hope to provide a full day's dose of vitamin A in as little as 300 grams of enhanced rice. The German team also has introduced an iron-making gene into rice and is working to combine that variety with the vitamin A-making strain.4 Japanese scientists have been engineering a similar iron-rich rice for some time.5 To combat malnutrition, development agencies would need only to distribute the gene-altered seeds, perhaps a one-time event if beneficial traits were passed on to the next generation of crops.
Plants bioengineered to contain greater nutritional benefits also may find places on the shelves of supermarkets in developed countries. For example, vegetables that contained greater amounts of natural cancer-fighting substances might be welcomed by consumers.
In some cases, bioengineers are working to remove undesirable substances from animals, animal products and plants. Ridding eggs of cholesterol is one possible goal; freeing foods of allergens is another.
An American company, Genzyme Transgenics Corp., has modified the genes of goats to make them produce milk that contains a human protein that regulates blood clotting, which has been difficult to produce in standard bioreactors using microbes. The company expects that its technique can be used to turn goats into "biofactories" to synthesize many other valuable proteins.7
The possibilities will increase as scientists continue to decode the gene maps of plants and animals and to understand how genes interact, cooperate and antagonize each other to influence biological systems. In sum, proponents say that GMOs can reduce farming costs, lessen the need for chemical pesticides and herbicides, improve the physical, aesthetic and nutritional quality of foods and create new and profitable options for farmers.
No one disputes the biotechnologists' ability to create organisms with traits that formerly were impossible. This unnatural potential, however, is cause for concern rather than celebration among some scientists and environmentalists. Technology advances often create new problems as they solve old ones. The industrial revolution brought unprecedented material wealth to societies but at the cost of environmental pollution and depletion of natural resources. Nuclear power, once promoted as the high technology solution to the oil crisis, has fallen into disrepute as the safety shortcomings of nuclear plants and the long-term environmental impact of nuclear waste have become apparent. Skepticism has grown as the public has discovered that the technical expertise of scientists and engineers to assure the safety of products and processes is, in many cases, too narrow to appreciate the full scope of possible consequences of their activities.
It is not surprising that the public has reacted skeptically to the bioengineers' claims that humankind is on the verge of a "food utopia" thanks to GMOs. The pro-GMO camp, moreover, does not have a monopoly on scientific knowledge. Several legitimate concerns have been raised about this powerful technology:
Critics, however, charge that seed companies do not ensure that farmers follow this practice. Even the bioengineering firms agree that nothing will prevent the development of insects immune to the natural pesticides currently engineered into crops. Monsanto Corp. executives, for example, apparently hope that the use of preserves can delay the rise of resistant insects for as long as 30 years. But Monsanto's response to the skeptics who suggest that immune bugs could appear in as little as three to five years, is that there is no cause for concern since there are thousands of natural pesticides that can be substituted for ineffective ones. Furthermore, Monsanto already has several of these in its development pipeline.9
Organic farmers use certain natural pesticides rather than manufactured chemicals. They have protested vehemently the introduction of genetically modified crops that incorporate these natural pesticides, since this practice eventually could produce resistant pests and thereby remove these natural weapons from their arsenal. Growers who refuse to use artificial chemicals have charged that not only are seed companies capturing profits from a public resource the natural pesticides but their actions might deprive the public of this natural good.
Anti-GMO activists also warn that neither the industry nor the government has conducted tests to determine the long-term consequences of ingesting natural pesticides. Advocates of engineered crops say that only substances that have been shown to be safe to humans but inimical to pests are considered for use. Nevertheless, proponents of GMOs have conceded that additional long-term testing is needed to investigate such issues as the following:
Proponents of transgenic crops riposte that the damage potential of gene-altered superweeds is small compared to the threat to indigenous ecosystems posed by introduced foreign plants. In American, for example, terrestrial and aquatic plants from Europe, Africa and Asia that have escaped from backyard gardens or were brought unintentionally into the country are outcompeting native flora in many areas across the nation.
To date, bioengineered crops seem only to have benefited farmers and seed companies. It is not clear that savings have been passed on to consumers. Bio-modified foods with enhanced properties higher levels of vitamins and minerals and greater protein content may help rehabilitate the image of GMOs.
Realizing the potential global impacts of genetically engineered foods, efforts to establish rules governing their international movements have been controversial. In brief, the United States, which accounts for significant shares of global agricultural commodities markets, leads the small group of countries that are opposed to special controls for transgenic products. The European Union, Japan and most of the developing world are on the other side of the table on this issue.
This divide was showcased in February 1999 at the second meeting of the United Nations Biodiversity Convention in Cartagena, Colombia. During the week before the full event, a working group met to hammer out a draft Biosafety Protocol that would regulate global trade in goods produced from GMOs. The working group included representatives from the 174 countries that had ratified the U.N. Biodiversity Convention signed at the 1992 Earth Summit in Rio de Janeiro, Brazil. Washington was represented, but since the United States had not ratified the pact, its delegation could only observe the proceedings. Nevertheless, American influence was felt through its leadership of the so-called Miami Group of grain-exporting nations that includes Argentina, Australia, Canada, Chile, New Zealand and Uruguay, all of which had approved the Biodiversity Convention. In short order, the discussions on the 600-page draft protocol boiled down to the Miami Group versus the EU and the other 110 or so national delegations.
The leaders of the bloc of developing countries pressed for the following three provisos at a minimum to be included in the Biosafety Protocol:
The EU delegates generally agreed with the last two points but were less eager to allow trade-restricting rules since they had to consider the welfare of their own biotechnology industries. Nevertheless, the EU was willing to compromise and did back the draft protocol rather than leave empty-handed.
The American-led bloc counterattacked on several fronts. First and foremost, they argued that not only are gene-modified crops safe, but they also offer significant benefits in terms of lower growing costs, better yields, less need for chemical pesticides and herbicides, and improved nutritional value attributes especially attractive to developing countries. The Miami Group members also warned that the proposed protocol would add significantly to storage and shipping costs, since it would require segregating ordinary and transgenic products. Finally, the group did not want the protocol to take precedence over the trade rules set by the World Trade Organization, a position that would prevent countries from unilaterally limiting or banning imports of GMOs. The U.S. observers summed up their position on the proposed protocol bluntly: "No deal is better than this deal."
Despite nearly two and a half years of preliminary discussions, the week of talks in February 1999 only widened the differences within the biosafety working group. When the Biodiversity Convention opened, the working group had to report that it could not submit a protocol for a full vote. The Cartagena discussion was so acrimonious that some observers were skeptical that the opposing viewpoints could be reconciled.
Nevertheless, the Biosafety Working group tried again in 2000 at a January 21-29 meeting in Montreal, Quebec. At first, it seemed that nearly a year of informal discussions had produced no effect: The United States remained adamantly opposed to rules that might restrict international trade in transgenic foodstuffs. In short, the talks came down to a staring match between the United States which was even more isolated because many of the Miami Group had signaled a willingness to compromise and the EU-led bloc.
At the eleventh hour, Washington's tough stance won out as advocates of strong restrictions agreed to compromise on key points. Even though the United States cannot sign the new Biosafety Protocol since it is not a signatory to the U.N. Biodiversity Convention, U.S. government and industry both have pledged to operate under its rules.
At first glance, it appeared that the critics of transgenic crops held their ground because the proposed pact included all three of their must-have negotiating points. However, Washington had kept strong labeling requirements out of the accord. International shipments of gene-altered foodstuffs must be marked that they "may contain" GMOs, but the labels do not have to provide specific details on type or percentage. Washington also was able to win exemption of processed food products and nearly all pharmaceuticals from the Biosafety Protocol's reach. Advocates of tighter trade-in-GMO controls were disappointed by the loopholes but emphasized that the agreement was a giant step forward because it enshrined the so-called precautionary principle which states that a country may protect itself by banning imports of certain products, even if it lacks conclusive scientific proof that such products are harmful in relation to gene-engineered crops.
Regulation of international trade in GMOs also has surfaced as an issue in the preparations for a new round of multilateral trade negotiations under the auspices of the WTO. As part of its mid-1999 list of subjects to be taken up in the new round, the Ministry of Agriculture, Forestry and Fisheries urged that an independent group take up new issues in agricultural trade, such as GMOs, food safety and organic foods.10 Zeroing in on GMOs, MAFF followed up in late September with a detailed proposal for handling this sensitive discussion (see Appendix Table 1).
While mentioning the technology's "great potential," MAFF's proposal also urges that its impact on the environment and on human health be studied extensively and that consumers' concerns be given high priority. The proposal steers clear of offering specific regulations for GMOs and suggests that any WTO talks on the subject be held from a broad perspective. Because the GMO debate overlaps many areas covered by different agreements for example, safety regulations, health policies and intellectual property rights Japanese officials admit that negotiating a comprehensive agreement will be difficult. Thus, they recommend that subgroups of existing working groups be established to address narrow segments of the overall GMO issue.
Generating even more interest have been decisions by the EU, Japan and others to require that consumer goods carry labels that list GMO ingredients. The U.S. government again is in the minority, insisting that a product regardless of how it is made need not be labeled if it is chemically identical to other items known to be harmless. American and overseas consumer groups and many foreign governments disagree. This issue, in particular, highlights the importance of relationships of trust among foreign governments and between citizens and their political leaders.
The anti-GMO movement got its start in Europe after a number of cases in which public health officials and government food inspectors failed to prevent food contamination or the spread of horrific diseases. In particular, the mid-1990s discovery of bovine spongiform encephalopathy, also known as BSE or mad cow disease, in Great Britain and the possibility that it could be transmitted to humans who ate certain tainted beef products, ignited consumer fears. The EU ordered the United Kingdom to stop exporting beef within the economic grouping, a prohibition lifted finally in August 1999. The French government continued to ban British beef, setting off a dispute with London that was settled by the European Commission, whose scientists certified that the meat products were safe to eat.
The BSE episode provided a long-running backdrop to other food poisoning cases, including salmonella in British eggs and contaminated soft drinks that sickened school children in Belgium. All together, these events have made European consumers hypersensitive about the quality and safety of their food supply. The EU responded in 1997 by toughening rules governing the testing and development of genetically modified organisms and by requiring that genetically manipulated products be labeled. Naturally, Washington opposed the labeling rule and has been negotiating over it with Brussels ever since.
MAFF began studying the issue in 1997 after the EU announced its GMO initiative. It was not until August 1999, however, that MAFF clearly got behind a GMO-labeling system and issued a preliminary list of food products that might be affected. Under MAFF's system, effective April 1, 2001, farmers, seed wholesalers and processed food makers must label their products that contain GMOs or proteins created with biotechnology. Distributors and other middlemen also will be required to certify that they have not combined GMOs and unaltered goods.
The Agriculture Ministry has walked a very fine line in picking the 24 food categories covered by the new rule (see Appendix Table 2). By focusing on the presence of genetically-modified proteins, the MAFF was able to exempt protein-free products, like canola oil or cotton, and products in which the proteins have been destroyed or removed during manufacture, like soy sauce, soy bean oil and corn syrup. Feed grains also are excluded since MAFF argues that animals substantially transform the proteins they consume. The bulk of MAFF's list is made up of soybean, tofu (bean curd) or corn-meal based products.
Washington now finds itself fighting this battle on two fronts, but since Japan is a much larger market for American grain and produce exports, the response to Tokyo's action has been more acute. Clinton administration officials have raised the subject in several bilateral forums (see JEI Report No. 34B, September 3, 1999), where the Americans have pointed out that Tokyo has certified more than 20 gene-engineered crops and products as safe for human use (see Appendix Table 3). With a long history on which to base their suspicions, U.S. authorities, seed companies and farmers worry that Tokyo will use the new labeling law to discriminate against imported foodstuffs. Since Japanese farmers currently grow almost no transgenic crops, the new requirement almost certainly will affect foreign products disproportionally.
MAFF's stance is supported by domestic consumer groups but not without qualification. In fact, consumer advocates want MAFF to require all products that contain transgenic ingredients to be clearly labeled as such. Such groups like as "Down With Genetically Engineered Food!" have begun beating the drums of public opinion, trying to bring more pressure on the authorities. Government, university and private researchers all agree that no genetically modified product has been shown to be harmful to humans and have criticized anti-GMO campaigns. But many of these scientists and government bureaucrats also profess to understand the public's concern and say that they believe the labeling regulations will be beneficial.
Japanese food producers and distributors are taking no chances and are moving to drop suppliers of GMOs well in advance of the implementation of MAFF's new system. Companies that will be affected are bidding up the price of conventional soy beans and corn in commodities markets. Some municipal governments are banning gene-manipulated products from school-lunch programs. Even companies whose products are exempt from the new system for example, soy sauce and beer plan to eliminate GMOs from their plants. The Japan Consumers' Cooperative Union and other co-ops are moving quickly to capitalize on the anti-GMO mood by selling their own brands of oil and soy sauce free of gene-altered ingredients.
According to a November 1999 survey by Nihon Keizai Shimbun, the food product industry's buying patterns are in flux. While 23.5 percent of companies surveyed said that they already use or plan to use genetically modified ingredients, 66 percent expressed a negative attitude toward GMOs: 35.6 percent said they probably would not use them, 16.7 will stop and 14.6 percent already had ceased. Food manufacturers are unhappy about this development, because they do not expect to be able to pass on the higher cost of non-GMO ingredients to consumers. Only 5.1 percent predicted that their cost of ingredients would not rise, compared with 75 percent who projected increased costs ranging from a few percent to 80 percent. As for the expected impact on retail prices, 44.4 percent said that they were unlikely to raise prices compared with 32.3 percent who said that retail prices were likely to increase anywhere from 1 percent to 30 percent, or more.11
While food producers are bemoaning their plight, others in the industry view the new regulations as a business opportunity. Food retailers are rushing to develop GMO-free product lines. Genetic-testing firms are reporting an upsurge in demand for their services, a trend that likely will continue as the implementation date of MAFF's labeling requirement nears. General trading companies are striking deals with suppliers in the United States, Argentina, Australia and Brazil to plant nonmodified crops specifically for the Japanese market. American commodities brokers and farmers are following a similar route but are grumbling about the costs of setting up parallel storage and handling facilities to separate ordinary and gene-altered crops.
The entire labeling debate has been blamed partly on the attitude and marketing practices of seed companies. They have come across as arrogant and greedy because, rather than allow for consumer input at the beginning of the process, they have appeared to force farmers and consumers to buy their costly products without regard for the potential harm. In addition, developing countries see the marketing of transgenic seeds by wealthy foreign companies as an attempt to lock them into a new dependent relationship that involves a vital market. Indeed, Monsanto was said to have developed a gene nicknamed "Terminator" within the company that would prevent its GMO crops from producing fertile seeds. Monsanto officials quickly tried to assure the world that the firm would not deploy the infertility gene.
Environmentalists and some scientists also bear some blame for the tempest in the teapot. When pressed, these anti-GMO activists admit the lack of incontestable evidence that gene-altered foods pose a threat to human health. They are unhappy that the U.S. industry and government are cobbling together the testing and regulatory framework for GMOs as they go, meaning that some potential problems may not be getting the attention they deserve. Everyone agrees that genetic manipulation is not an exact or perfect science and that introducing modified organisms into the open environment involves some risk. Yet opponents of GMOs have downplayed or refused to acknowledge the benefits that the new technology offers.
Nor has the the nature of the transgenic products on the markets so far contributed to a well-rounded debate. Modified crops seem to have benefited only the seed companies and the farmers who grow them. The public has not yet seen lower prices or improved nutritional quality. Instead, consumers see themselves as unwilling guinea pigs for seed companies because they are being asked to eat foods that could have latent negative effects. Even pro-GMO observers say that labeling products that contain modified ingredients is a good thing; it keeps consumers informed and, if used wisely, can be an advantage. When nutritionally enhanced foods start appearing on the market, these analysts continue, public opinion about GMOs may begin to shift toward the positive.
Tokyo has set its course on the labeling issue, taking a politically understandable but scientifically doubtful position. Since the government itself is backing the development of gene-altered crops, particularly rice, some observers warn that Tokyo's pro-labeling stance may haunt it in the future. Nevertheless, Tokyo has joined Brussels in the GMO-labeling camp and likely will play a role in shepherding this controversial subject through the tortuous waters of the next WTO round. Whether Tokyo and Washington will come to blows over MAFF's rules for modified foods likely will depend on how the ministry implements the system and how it affects U.S. farmers and seed companies.
Kanako Yamada provided research assistance.
1 aa For a primer on biotechnology and its commercial applications, go to the Biotechnology Industry Organization's Web site at http://www.bio.org/aboutbio/guidetoc.html. Return to Text
2 aa See Jon Choy, "Research And Development In Japan: The Rethinking Continues," JEI Report No. 41A, October 29, 1999. Return to Text
3 aa Michiyo Nakamoto, "Japan's move on labeling may anger U.S." The Financial Times, July 15, 1999, p. 5. Return to Text
4 aa Guy Gugliotta, "Gene-Altered Rice May Help Fight Vitamin A Deficiency Globally," The Washington Post, January 14, 2000, p. A6. Return to Text
5 aa Seiji Hirasaki, "Food Finds Place On Bioengineers' Plates," The Nikkei Weekly, May 18, 1998, p. 5. Return to Text
6 aa "Seeds Of Discontent," The Economist, February 20, 1999, p. 76. Return to Text
7 aa Justin Gillis, "Down on the High-Tech Pharm," The Washington Post, January 17, 2000, p. A11. Return to Text
8 aa John Carey, Ellen Licking and Amy Barrett, "Are Bio-Foods Safe?" Business Week, December 20, 1999, p. 74. Return to Text
9 aa Michael Pollan, "Playing God in the Garden," The New York Times Magazine, October 25, 1998, p. 50. Return to Text
10 aa Ministry of Agriculture, Forestry and Fisheries, MAFF Update, No. 320, July 30, 1999. Available at http://www.maff.go.jp/mud/320.html. Return to Text
11 aa "Genetically Altered Foods Quickly Becoming Taboo," The Nikkei Weekly, November 11, 1999, p. 1 and "'Kumikae' Genryo Shiyoo Yameru to Kigyo no Hachi Wari 'Kosuto Zoka'([Food Makers] To Stop Use of 'Altered' Raw Materials and 80 Percent of Firms [Expect] 'Cost Increases')," Nikkei Sangyo Shimbun, November 1, 1999, pp. 1 and 14. Return to Text