Japan's 21st Century Vision.

(From Journal of Japanese Trade & Industry (JJTI))

Byline: Shirai Sayuri

Points for Japan to Consider In order to take advantage of globalization, and to produce a vibrant society capable of meeting new challenges, Japan must come to terms with the following issues. First of all, it is important that corporate head offices should remain in Japan, and that the high added-value aspects of the production process should also be carried out with goods exported from Japan. Measures that further enhance technological and developmental capabilities should be considered and introduced. For this to happen, Japanese society needs to become more open, and we need to create a society where people, goods and money can circulate over the constraints of national borders. While lifting Japanese education to the global standard, we must aim to create a nation that attracts high-caliber personnel and corporations regardless of their nationality. In doing so, we can advance the nation's technological innovation and accumulation of knowledge. Organizational reform and deregulation, which are required to increase productivity, should also be promoted. Fiercer competition in domestic service industries will improve efficiency, enabling them to provide even higher quality service. To this end, we need to remove the barriers hindering the entry of foreign corporations and accept skilled and qualified foreign workers into our workforce in a selective and strategic manner. Second, it is important that measures are taken to increase the number of foreign tourists visiting Japan. An increase in foreign visitors not only helps to expand domestic employment and income (an improvement in the services income shown in the figure) and reduce regional income gaps, but also boosts the number of people with an affinity for Japan, thereby encouraging economic, social and cultural exchange. In the long term, this increases the number of countries friendly to Japan, which contributes Japan's national interest because it may boost support for Japan gaining a permanent seat on the United Nations Security Council. At present, approximately 4.8 million foreign tourists visit Japan each year, which is still fewer than the numbers for China, Hong Kong, Malaysia and Thailand. Japan ranks only 35th in the world. To boost the number of incoming tourists, Japan needs to foster a tourism industry that will help to attract foreigners and make them feel happy to choose to visit Japan, and to adopt promotion policies that have the cooperation of the whole community. We also need to ensure that Japanese citizens will be more open toward foreigners than they are at present.

Third, we need to create firm economic relations with East Asian countries by encouraging the establishment of FTAs or economic partnership agreements (EPAs), as the region is expected to continue to record strong growth. The speed of Japan's regional economic integration is hindered by the protection of some agricultural goods and the opposition to accept foreign labor. To avoid being left behind in the global trend toward regional economic integration, within the next one or two years Japan should push hard to establish formal economic links among the countries of East Asia, and in particular, commence negotiations towards the establishment of an EPA with China, which would produce a major economic effect. At the same time, Japan needs to continue to work toward the multilateral liberalization of trade and investment through the World Trade Organization (WTO). Despite being the world's largest importer of agricultural products, Japan gives the world the impression that it is opposed to trade liberalization because it gives an extremely generous level of protection to specific domestic agricultural goods such as rice. In terms of displaying the leadership necessary to ensure the stability and prosperity of the global economy, the world's second largest economic power should not be giving such an impression. Swift agricultural reform, including subsidy systems and the entry of private ...