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Press translations [Japan]. Economic Series 0014, 1945-11-23.
Supreme Commander for The Allied Powers. Allied Translator and Interpreter Section.

translation-number: economic-0079

call-number: DS801 .S81



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GENERAL HEADQUARTERS
SUPREME COMMANDER FOR THE ALLIED POWERS
ALLIED TRANSLATOR AND INTERPRETER SECTION
PRESS TRANSLATIONS
No. 79 Date: 23 Nov 45

ECONOMIC SERIES: 14

ITEM 1 Japanese-produced Fertilizer for the Wheat crop - Nippon Sangyo Keizai - 12 Nov 45. Translator: I. Shigeki.
Full Translation:
The SHIZUOKA Prefectural Agricultural Association, in line with the current campaign, has made thorough plans to plant wheat at the most suitable time, to make up for the unfavorable rice crop. On the other hand it has tried every conceivable means to procure fertilizer. This year the farmers, like last year, must depend upon Japanese-produced fertilizer.
By this plan the amount of fertilizer allotted to this prefecture for August to November for 6l,700 chobu is as follows:
Ammonium Sulphate - 991 metric tons
Nitrogen lime - 1,540 metric tons
Toma's phosphorus manure - 279 metric tons
Also potash manure from SHIZUOKA - a small quantity.
The quantity of ammonium sulphate for this period is 991 metric tons less than for the same period last year and is not sufficient; but the quantity of nitrogen lime for this period is 560 metric tons more than for the same period last year.
This will be used as a fallow-manure, a thing not previously done. Therefore this period's quantity of home-produced fertilizer will not be decreased but will be used chiefly as a foundation manure.
Since the use of oil cakes produced from soy-beans and vegetables, specially treated fertilizer, and fertilizer from aquatic products is not very promising the SHIZUOKA Prefectural Agriculture Association is planning to hold special trainning courses to promote production by fertilization by developing fertilizer from burnt mould.
ITEM 2 Abolishment of the Priviliged Class among Farmers - Mainichi Shimbun - 13 Nov 45. Translator: T Unayama.
Full Translation:
Someone said that the net purchasing price of rice from the producers would be 500 yen per KOKU; others said it would be 350 yen, but it was finally fixed at 150 yen per KOKU. A producer gets 95 yen as compared with last year's price of 35.5 yen. The price for landowners is 55 yen as before, but we think that the food problem

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ECONOMIC SERIES: 14 (Continued)
ITEM 2 (Continued)
will not be solved as long as there is a separate price for landowners.
If farm-rents are paid in cash and not with crops, the landowners' situation will become gradually unfavorable and they will lose their farms. We think, therefore, the establishment of a peasant proprietors' system should not be rushed.
At present, however, landowners are priviliged farmers who can get rice in straw-bags, from the tenants, and it is regarded their special right to have the rice reserved for their families. If there is anything feudal, it is this fact that there are farmers who do not work. This is the very picture of feudalism and they are the aristocrats of the farming-class.
In JAPAN, there are many landowners' sons and brothers among students of agriculture, for the tenants could not afford to give their sons a higher education, and few intend to study agriculture except landowners' sons and brothers. We were unable, therefore, to hear any criticism of the tenant system. If there was any it was lukewarm. These sons of landed aristcrats joined the Ministry of Agriculture and Forestry.
The government has, for many years, advocated the establishment of free peasant farmers, so that even under favorable conditions a radical solution of land-problem is difficult. In order to remedy the situation, the government should require the landowners to sell all rice paid to them as rent in lieu of cash, and should not permit them to hold the rice for the use of their own families. For the same reason special distribution of sugar to the stockholders of sugar-manufacturing companies is not permitted. The reason for there being no reform in tenant farming is that not only the students of the agricultural policy support the landowners but also members of the Diet who act for the landowners, although they claim to represent the tenant farmers.
Generally speaking, any reformation of a social system is accompanied by disorder, but the disorder that would result from abolition of the landowner class would bring about no decrease in farm production. The fact that reformation is not carried out resolutely, at present can be attributed to a lack of democracy.
The government will, it is reported of late, adopt legislative measures to compel the sale of the landowners' farms for the purpose of establishing peasant proprietors, but the price to be paid for the land is questionable, for the price of farms has been inflated.
The number of inhabitants in farm villages is increasing with demobilization and the return of unemployed to the farms; the landowners, therefore, are very self-assertive and the establishment of peasant proprietors becomes more and more difficult.
The price of food will rise, but few will protest if the price of rice goes up 40 sen or 50 per SHO. Wages should be set in accordance with the price of rice under the present blackmarket conditions.
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ECONOMIC SERIES: 14 (Continued)
ITEM 3 Speeding Increased Output of Gold. Considerable Raise in Prices Expected. - NIPPON SANGYO KEIZAI - 14 Nov. 45 Translator: S. Kinoshita.
Summary:
At a 13 November Cabinet meeting, the government with the sanction of General MacARTHUR'S Headquarters, agreed on a plan to increase the output of gold as an aid to the settlement of overseas accounts.
The plans call for:
The immediate development of mines now in operation, the renovation of abandoned and inactive mines, and a search for new ones.

In this connection the following statistics were released:
Mines in operation 155
Inactive mines under supervision 6
Abandoned nines 333
Total 494
Mining rights owned by the Imperial Mining Industry Development Company, Ltd., (TEIKOKU KOGYO KAIHATSU KABUSHIKI KAISHA) should be expropriated. Whether the owners should be compensated at the purchase price plus interest, or at only the purchase price, or at a price lower than purchase price will be decided at the conference of Finance Ministry and Commerce, and Industry Ministry.

Total assets of the Imperial Mining Industry Development Co. Ltd. removed from abandoned mines since April, 1943 is as follows:
Mine lots (275 lots) 75 million yen
Equipment (Smelting works, etc.) 112 " "
Real estate 22 " "
Floating capital 20 " "
229 million yen
The government's purchase price of gold will be raised to more than double the present price of 5.80 yen per gram. This price was fixed in January 1938, on the basis of the exchange rate of $29.00. Assuming that the exchange rate is 15 yen to one dollar and the UNITED STATES price of gold is $1.13 Per gram, the price of gold here is calculated to be 16.878 yen per gram exclusive of transportation charges.
Output of gold during past six years:
1939
a- JAPAN proper 25.926 metric tons
b- KOREA 29.192 metric tons
c- FORMOSA 1.165 metric tons
56.384 metric tons
1940 51.675 metric tons
1941 51.810 metric tons
1942 47.410 metric tons
1943 29.919 metric tons
1944 14.040 metric tons

In 1945 the output is expected to be a little more than 5 metric tons. Ful1 co-operation of the people is sincerely requested by government authorities.
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ECONOMIC SERIES: 14 (Continued)
ITEM 4 Reconversion to Civil Industry, Explanation by Commerce and Industry Minister Ogasawara. - NIPPON SANGYO KEIZAl - l4 NOV. 45 Translator: M. Maruyama.
Full Translation:
Little headway seems to have been made in the reconversion of munitions factories into civil industry during the past three months since the ending of the war. What is the cause? The non-solution of the reparations question may be one, unfavorable production conditions with particular reference to the foodstuff shortage may be another, but the most crucial matter that forms the key to the solution of these conflicting issues will be a quick reconversion of the munitions industry into civil industry. In an effort to draw something definite from the government's policies on the reconversion question, a group of Japanese newspaperman interviewed Commerce and Industry Minister Sankuro OGASAWARA.
The Minister emphasized, in connection with the reconstruction of peacetime industry, that the munitions industry should seriously reconsider its position and in forgetting the excessive favors and protection of the government in which it had basked in the past, it should form the foundation of future development on its own strength. Referring to the reparations question, the Minister declared the the government would strive to prevent the payment of reparations from interfering with the development of civil industry.
Turning to the prospects of the country's export industry and peacetime industry, Mr. OGASAWARA declared, "Efforts must be directed toward the replenishment of real strength so as to enable this country to stand an international free competition and toward the raising of the level if national livelihood by maintaining a level of wages. Care also should be taken not to invite the criticism of social dumping (T.N. Underselling.).
The questions and answers between the newspapermen and the Minister follow verbatim:
Question: What is the present condition of the reconversion of munitions manufacturing companies into civil industry?
Answer: Munitions factories which used to manufacture articles now prohibited require government permission separately in connection with their reconversion, and, for this reason, most of such factories are still discontinuing their operations. Factories other than this category have already reopened their former peacetime industries, though partially, and are producing articles necessary for national livelihood, at least for the time being. Peacetime industry at present is not at all in a full-fledged condition of revival and this is unavoidable for various reasons which I shall tell you.
First, because of the fact that the policy of the Allied Nations in this was not definite during the time immediately following the termination of the war, the munitions companies had to maintain the suspension of factory operation in accordance with General Directive No. I. Later, however, the attitude of the Allied Forces toward the civil industry had been gradually made clear. It was a matter of undisguised joy that the procedures necessary for obtaining permission for operating civil industry and those activities relating to
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ECONOMIC SERIES: 14 (Continued)
ITEM 4 (Continued)
reconversion were made clear and definite in Directive No. 3 issued on 22 September, thereby opening the way to reconversion for almost all industries. To industry as a whole, however, the Directive of the Supreme Allied Headquarters amounts, so to speak, to a question of formalities or legal ordinances, because the Directive has not presented any substantial conditions necessary for the operation of industrial enterprises. The munitions industry has lost the objective of production, as a result of the war's end, and, moreover, a serious lack if labor, production materials and other important factors incidental to production, combined with a temporary suspension of the government subsidy for production encouragement, made the adverse conditions accumulating during war all the worse.
Mental and physical shocks have assumed tangible shape with the result that a state of torpor has been created. It is not necessary to emphasize that the improvement of material conditions failed to be realized despite the government's efforts. When this is considered, there are really extenuating circumstances in which the industrial reconversion finds itself at present, for which I express my sympathy.
On the other hand, however, the munitions industry fully enjoyed warm protection during wartime, because of its importance, and was moving blindly under the direction of government institutions issuing orders. In a sense, therefore, the predicament in which the munitions industry finds itself may be considered a good chance for it to reconsider its present strength and also to form a solid foundation for its future development. During wartime munitions companies were supposed to have been guaranteed the cost of production (including depreciation) and a certain amount of profit, if they enlarged their equipment and produced munitions simply at the will of order-issuing government institutions, but such a production formula is often likely to cause companies to lose the constructive and independent natures characteristic of industrial enterprise and result in the creation of bulky but non-substantial enterprises.
Viewed in this light, the present test now being gone through by the munitions industry is the severest indeed, but, nonetheless, it is the best chance to let the industry reconsider its strength. Unlike the days when the war was on, the present is the time for the industrial reconversion to get the services of men with real ability and conviction, while in wartime munitions companies were solely absorbed in rallying a large number of laborers and technicians. The utilization of war materials at hand to peacetime industry also must be done, but the extent of damage done to these stocks is very great. I sincerely believe that the present coal crisis can be tided over to a certain extent, if we bear up under the situation for some time to come.
To make a long story short, many difficult issues, including the reparations question, foodstuff production, importation of raw materials, and others, are lying ahead of us, but this will be the the very time for industrialists with strong conviction and keen insight to give full play to their ability. I expect this from the industrialists as a whole.
The result of recent investigation conducted by the Ministry on 449 munitions companies on the industrial reconversion reveals the following:
In the metal industry, 6l out of 66 companies reconverted and are
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ECONOMIC SERIES: 14 (Continued)
ITEM 4 (Continued)
continuing business, while four are cither dissolved or their status unknown. In the mechanical industry, 265 out of 306 effected reconversion and are continuing business while 41 are either dissolved or their status unknown. In the chemical industry, 62 out of 66 reconverted and are doing business, while 4 are either dissolved or their status unknown. In the fibre industry, four are all continuing business, and in the lumber industry, eight companies, are all doing business.
However, due to various reasons, these companies have not yet taken up their full-time operations. The reconversion of medium-sized and small-scale factories in TOKYO is proceeding satisfactorily. For instance, out of 2,400 factories, 2,070 have effected reconversion and 330 are either unknown, incapable of operation or dissolved.
Question: Are munitions factories confronted with a lack of capital, due to non-solution of the loss indemnification question, and, if so, what measures will the Government take?
Answer: As to the readjustment funds for the munitions industry and the capital necessary for the revival of civil industry, appropriate steps have been taken by the Finance Ministry since the termination of the war. The indemnification issue needs careful deliberation, considering the relationship to the Supreme Allied Headquarters, harmonization with financial policy, balance of national debts and others, but, at any rate, steps must not be taken to impede the development of civil industry, because of this issue.
Question: Is it true that lack of materials particularly coal, coke, gas and others are interfering with the progress of industry although reconversion was effected
Answer: This is partially true, but industry depending upon domestic resources will see the situation now favorable with the passage of time. There is no way other than to gain the understanding of the Allied Forces as to the importation of materials, such as petroleum products, salt, and raw cotton. Part of the salt has been imported. Further efforts will be made to effect its importation, but efforts must be made for the importation of foodstuffs above anything else at present, since this forms the basic condition toward solving all problems.
Question: Controversies resulting from high costs and official prices are supposed to be causing some companies to be delayed in the process of reconversion. What do you think of this?
Answer: This question promises to be solved readily, as it is purely a question of policy, and on consultation with the Finance Ministry the matter is expected to be ironed out rapidly. As was frequently declared before, the official price system is limited to a minimum degree of basic materials and main dietary foods.
Question: What is the government policy on industrial encouragement in terms of the importation of foodstuffs and materials insufficiently obtainable at home?
Answer: In this country the fiber industry, precision machine industry, porcelain, chemicals, medicinal industry, cement industry, toy and other miscellaneous industries, tea industry, etc., can be counted as collateral export industries for imports, but many of these industries go on the basis of receiving permission for the importation of materials for the production of export goods. For the time being, therefore, only industries
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ECONOMIC SERIES: 14 (Continued)
ITEM 4 (Continued)
which depend upon available materials must be upheld and the articles thus produced will have to be made collateral for imports of foodstuffs and articles of daily necessity.
In the meantime, the government would like to take steps gradually for the importation of necessary raw materials. The government is also determined to take the following measures during the intervening period:
Necessary industrial power shall be reserved in connection with the reparations question and as a means of reparations, the selection of the above mentioned industries is made.
Realization of quick participation in international trade.
Petitions to be made for the importation of necessary materials and insufficient foodstuffs.
Establishment of credit pending the completion of manufacturing of imported materials into processed goods.
Acceleration of raising the level of industrial technique and productive capacity.

In the future considering the nature of future international trade, the government will not adopt in principle such a direct protective trade policy as subsidization, which was practised in the past, although it will encourage export trade. Industrial circles, therefore, must develop the strength enabling them to stand the international fair and free competition, raise the level of national livelihood by the adoption of a wage system and at the same time take care not to invite critcisms of underselling.
Question: What is the prospect of the sphere and scale of peacetime industry?
Answer: The export industries already mentioned, industries manufacturing articles necessary for national livelihood, the mining industry, the electric industry, the traffic and communications industry, and public works for rehabilitation will be included into the sphere. As to its scale, medium-sized and small-scale industry bids fair to expand, because of the disorganization of large financial interests and munitions companies, and prohibition of industrial monopoly.
On the other hand, it is possible that industrial fusion, strengthening of cooperative unions, and other steps to correct defects in these industries will take place to the appropriate degree. For this the government will give its full measure of support.
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HomePress translations [Japan]. Economic Series 0014, 1945-11-23.
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