Does Agricultural Trade Liberalization under FTA Reduce Pollution from Agriculture? : The Case of the Japan-Korea FTA

The purpose of this paper is to contribute to the debate over agricultural trade and environment by asking: Does agricultural trade liberalization under free trade agreement (FTA) reduce pollution from agriculture? In order to contribute to answering the above research question, we measure the potential impact of environmental pollution from agriculture caused by agricultural trade liberalization under the Japan-Korea FTA (JKFTA), using the Global Trade Analysis Project (GTAP) model and the OECD Nitrogen Balance Database. The scenario we model assumes the complete removal of all import tariffs between Japan and Korea, not only in the agricultural sector but in non-agricultural sectors, as well. The results show the JKFTA is likely to lead to an overall increase in the total nitrogen surplus for Japan and Korea. Therefore, our results suggest that agricultural trade liberalization under FTA does not reduce the potential pollution from agriculture in the case of the JKFTA.