The Japanese economy has gained momentum, with “Abenomics” playing a key role in the country’s economic revival. But the latest OECD Economic Survey of Japan warns that more needs to be done to underpin inclusive growth, productivity and well-being amid pressures from high and rising government debt and a shrinking workforce.
Economic growth is projected to reach 1% in 2017 before slowing to 0.8% in 2018, boosting headline inflation to 1.25% by the end of 2018. With three supplementary budgets in 2016, fiscal consolidation is pausing, helping Japan to cope with the impact of the yen appreciation. Private consumption is projected to continue rising in the context of labour shortages and the historically high level of corporate profits.
World leaders attending the UN Conference on Climate Change (COP21) in Paris know they have a rare opportunity to forge a new international agreement to combat climate change and set forth a pathway towards a low-carbon world. More ambition will be needed by all sides if global temperatures are to be prevented from rising above 2°C, the agreed threshold for preventing catastrophic climate change. But even without that target, unleashing a low-carbon future makes sense for health, costs and sustainable development.
Productivity increases can unlock growth in Japan, the latest OECD economic survey reports.
Exactly five years ago, on 11 March 2011, a violent earthquake struck eastern Japan. The tsunami that ensued devastated the inland up to 10km and put the Fukushima nuclear power plant at risk, forcing it out of action. The result was a humanitarian and environmental crisis.
"We feel the loss of Kenji particularly closely as his wife had worked at the OECD from 2008 to 2012. Our thoughts, sympathy and prayers are with her and their daughters in this difficult moment."
Eight giant balloons from Japan floated in the shadow of the Eiffel Tower on the weekend of 30 August, a reminder of one of the worst natural disasters of recent times–and of the determination of survivors to rebuild their region.
Japan gained OECD membership in 1964, the same year it hosted the summer Olympic Games in Tokyo. Its entry into the organisation is significant in three main ways. The first is historical: Japan’s joining the OECD, which followed the signing of the San Francisco Peace Treaty in 1954 and entering GATT in 1955, signalled its successful transformation into a fully industrialised economy.
One day I discovered a vast archive containing the work involved in attaining OECD membership
The year 1964, exactly 50 years ago, was marked by two events that symbolised Japan’s completion of its recovery in the period following the Second World War. One was the Olympic and Paralympic Games in Tokyo—their first time in Asia. The second was Japan’s joining the OECD, again, the first Asian country to do so. The newspapers of the day ran the headline, “Japan finally joins the ‘grown-ups’,” showing how accession to the OECD was emblematic of becoming a developed country.
OECD membership crowned Japan’s efforts to reintegrate into the international community after the Second World War, while helping to turn the organisation into a global, rather than European, player. But the country’s accession had to be managed with great care, reflecting tensions of the time.
One day I discovered a vast archive containing the work involved in attaining OECD membership.
After two decades of sluggishness, a recovery could be under way. This time, it could be sustained.
Reconciling work and family commitments is a challenge in every country, but particularly for Japanese men and women. Much more so than in most other OECD countries, men and women have to choose between babies and bosses: men choose bosses, women less so, but on the whole there are very few babies and there is too little female employment. These shortcomings are increasingly coming to the fore and will have to be addressed.
Trade has always been a pillar of the Japanese economy, but further integration into world markets would bolster long-term growth.
To stay ahead among the most modern and productive industries in the world, Japan’s industries need more access to knowledge, technology, people and resources from outside the country.
Japan may be on the cusp of a fresh wave of “cool entrepreneurship” that could turn the country’s creative industries into a new source of growth.
Non-nationals are starting to make an impact in top Japanese firms. But will other firms take notice? Changes in education would help.
Some 50 years ago, Japan entered into the period of post-recovery after the Second World War, while consolidating its path for economic growth and making a comeback on the international scene. Japan’s accession to the OECD was symbolic in that respect. Another symbol was the Tokyo Olympic Games, which triggered a transformation of Japan’s international image, thanks to improvements in its physical infrastructure, transportation systems and services. A new expressway network had been built across Tokyo, the new Shinkansen high-speed “bullet” train now relayed Tokyo and Osaka in four hours, and television began broadcasting in colour.
Japan is one of the world’s most compelling success stories in education. But can it stay at the top? Yes, but new approaches will be needed.
Unique budgetary and demographic pressures, as well as the need to manage risk, will push Japan’s civil service to raise its game and adapt new ways in the years ahead.
It is essential for the OECD to strengthen its ties with East and Southeast Asia.
Japan’s accession to the OECD was an event that marked Japan’s entry to the club of developed nations. In 1964, Japan was in the midst of high-speed economic growth, and the national policy was to catch up with and overtake the US and Europe. In October of that year, Tokyo hosted the first Olympic Games to take place in Asia, and four years later, in 1968, the country’s GNP passed West Germany’s and Japan became a major economic power second only to the US.
Development is at the heart of the OECD’s mission, and Japan has always been at the heart of the OECD’s development efforts.
Yuko Sakurai is one of a new “global” generation of talented Japanese painters. Born in Tsuyama in 1970, Ms Sakurai has lived in North America and Europe, and is now based in Paris, France. Her warm, rich, virtually tactile paintings have won acclaim in several major cities, and were exhibited at the prestigious Venice Biennale in 2011. Ms Sakurai personifies a new, cool Japan and its enriching influence in an evolving global village. She describes some of her thoughts in this interview.
Japan’s development and influence have long been reflected in its architecture, and that influence is set to continue.
Japan and the OECD have worked hard to get to know each other over the last 50 years.
Hearing that it is 50 years since Japan became a member of the OECD evokes deep emotions in me. During that time, I worked twice in the Permanent Delegation of Japan to the OECD, over a total of six and a half years, and the 50-year period following Japan’s accession was also a time of both development and stagnation for the Japanese economy. During the first 30 years, Japan learned a great deal from the OECD, and its economy developed considerably. During the last 20 years, with Japan drawing less from the OECD, the country stagnated. The OECD remains the most important international body associated with economic and social issues in general, and also the world’s biggest think tank, so both Japan and the wider world should be wise enough to make full use of it.
Hi, my name is Kaori Miyamoto, and I work as a senior policy analyst in the Development Co-operation Directorate, currently doing research on policies to mobilise private investment for developing countries. I joined the OECD in 1998 from the World Bank in Washington, DC. This makes me the longest serving Japanese staff member, with 16 years under my belt.
Though I was born in Osaka, I grew up and lived in many countries, including the UK, the US, Sri Lanka and Thailand. I have worked in several countries in Africa too, so I am comfortable with the multicultural environment of the OECD. I also highly value the knowledge sharing and standard setting among developed countries in policy areas such as health, education, employment, tax, pension, gender, consumer issues and many more.
I believe that our countries as well as other global economies can learn from each other and improve their policies back home. In fact, I actually think that by facilitating an open and frank dialogue and co-operation among each other, the organisation not only helps improve people’s lives, but contributes to peace and stability. In other words, our work can promote well-being and hopefully prevent a major world war from breaking out again.
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