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No.62

COVID-19 Pandemic and the Economy: Need Sound Public Finance for Maintaining Social Safety-Net

Nobuhiro Kiyotaki, Professor of Economics, Princeton University   Key points Should corporate bankruptcies increase, credit crunch may follow Postponing retirement is more effective than high inflation for fiscal consolidation Promoting open economy is important for growth after the containment of COVID-19   Following COVID-19 pandemic and government restrictions on social and economic activities, the global economy plunged into the deepest recession of the postwar era and the lives of people have been affected profoundly. This article discusses the impact of the COVID-19 pandemic, policy responses and the future direction from a macro-economic perspective. The COVID-19 pandemic makes it difficult to engage in activities that involve social contact and possibility of infection. Consumption, especially services consumption in restaurants, leisure and hospitality, has decreased significantly. Let us look at consumption and employment in the United States by referring to data collected by Professor Raj Chetty of ... ... [Read more]

No.62

Future Direction of International Trade Systems: Institutions matter – a rise of “peer value chains”

Inomata Satoshi, Chief Senior Researcher, Institute of Developing Economies, Japan External Trade Organization (JETRO)   Key points Institutional similarity will be even more important in shaping global value chains than geographical proximity Multinational firms will seek to offshore production to countries with robust institutions akin to their home business environment Complete decoupling of the world economy is inconceivable, but partial decoupling is probable   According to Richard E. Baldwin, Professor of the Graduate Institute of International and Development Studies, the international production system is based on tri-polar networks of Factory Asia, Factory North America and Factory Europe. Namely, global value chains (GVC) are not truly global, but are more likely to be regional. How will GVC look like in the post-COVID19 world? They are considered to evolve from regional value chains based on geographical proximity to production networks connected through institutional similarity (of legal ... ... [Read more]

No.62

How to Face up to an Uncompromising China? (II): China’s Economy Towards a Stronger Governance Coexisting with Negotiations/Coordination with US

Ito Asei, Associate Professor, University of Tokyo   Key points Toward an “unknown normality” after the US-China conflict and COVID-19 Stronger governance and a more sophisticated, expanding Chinese economy Japan to continue to exert influence on thoughtful action   The concept of the new normal entered the picture after the advent of the Xi Jinping administration. The end of the rapid economic growth and China becoming a middle-income country transformed national issues. The new normal indicated that the administration recognized this fact. But now, after the US-China conflict and COVID-19, China’s political economy finds itself in an unknown normality in a dual sense. This article will confirm the economic situation during the COVID-19 crisis and examine trends in China from the perspective of structural change. There are both strong and weak aspects to the economy in China after COVID-19. At the start of the ... ... [Read more]

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No.51

Can Japanese Diplomacy Talk about Universality?—Rebuilding public diplomacy strategy

Amidst the flux of the liberal international order, Japan’s public diplomacy, which relies solely on its cultural uniqueness, is inadequate. The author proposes new principles for an age where the diplomatic sphere is expanding from negotiation tactics to agenda setting and norm setting. In the fall of 2017 when there was a succession of major events—the 19th National Congress of the Communist Party of China and US President Donald Trump’s visit to China—I visited Peking University and had an opportunity to exchange opinions with many experts and specialists. What impressed me in particular was that the Chinese side emphasized the negative aspect of democracy and used it in justification of the Communist Party’s monopoly on power. The Chinese experts and specialists said the following: Democracy could just consider short-term profits like companies operating under a capitalist system. The only interest of politicians and political ... ... [Read more]

No.51

Thirty years of clambering up and slipping back down— A comprehensive look back at the Heisei period

  What kind of period was Heisei (1989–2019) Kitaoka Shinichi: My image of the Heisei period is of a crab at the bottom of a washbowl trying to climb up but then slipping and falling right back down. Heisei began with the bubble bursting in 1991 (Heisei 3) and Japan tried to respond to it in various ways. Although there was political reform and administrative reform, the Asian currency crisis came in ’97, before these trials showed any effect, and it looked like it was all over for Japan. But in 2001, Koizumi Junichiro appeared as Prime Minister, promised to “destroy the Liberal Democratic Party (LDP),” and became hugely popular. Yet the LDP wasn’t particularly destroyed, and it’s hard to say that anything has moved forward. Then in 2008 there was the global financial crisis, and in 2011 the Great East Japan Earthquake and ... ... [Read more]

No.51

The True Home of Japan Studies Is Not Japan: Academic rivals are skilled at reading cursive script and transliterating classical Chinese into Japanese

  Who really “owns” Japan studies? In the list of academic fields eligible for Grant-in-Aid for Scientific Research by the Japan Society for the Promotion of Science, no such field as “Japan Studies” exists. If one searches the list for the keyword “regional studies,” there is “East Asia,” “South East Asia,” “South Asia,” “West and Central Asia,” etc., but there is no “Japan.” Although there are research and education organizations with Japan studies in their title (I also conduct joint research with them), I think that they take an extra effort when applying for research funds. It is not my intention in this article to criticize how, within Japan, Japan studies are treated as if they do not exist in that grant scheme. Yet, if it is true that the readers of this article (including specialist researchers) assume that Japan studies are mostly undertaken ... ... [Read more]

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No.62

We Are Approaching the Limits of Having Only Policies that Preserve Employment!: The Largest Number of People Taking a Leave of Absence Since World War II—What Has Happened in the Labor Market?

Genda Yuji, Professor, University of Tokyo Only a Slight Increase in Unemployment in April When the declaration of a state of emergency was issued for all of Japan due to the spread of COVID-19 in April 2020, the survival of many companies was in jeopardy and the Japanese workplace faced unprecedented difficulties. Job opportunities collapsed and there was concern that we might see workers lose their jobs and struggle to survive. According to the Labor Force Survey by the Statistics Bureau, Ministry of Internal Affairs and Communications, released at the end of May, the number of workers across Japan was reduced by 1.07 million (seasonally adjusted) in just one month from March to April when infections rapidly spread. As a great reduction from the previous month since May 1953 when comparisons can be made, it was second to the 1.13 million workers from January ... ... [Read more]

No.61

Infectious Disease and Civilization in the Twenty-first Century: Invisible Calamities Attack Modernity and the Spirit of Civil Virtue Developed by the Japanese People

Yamazaki Masakazu, Playwright and Critic   Editor’s note: Professor Yamazaki Masakazu passed away on August 19, 2020. This article, written in early May 2020, is published in translation here with the permission of the bereaved family and the original publisher. Going back to a previous time in world history The current spread of COVID-19 can be considered a “historic” event in two senses. Firstly, of course, it is an epoch-making tragedy and turning point in contemporary history, because the epidemic is likely to have a lasting influence on future civilization. Secondly, and of greater significance, the tragedy pours cold water on the hidden arrogance of modern people, and we can imagine it encouraging a return to the human civilization of the past: a time when urban civilization arose. The epoch that we call the “modern age” has had a number of stages—and as humanity ... ... [Read more]

No.61

The Way Forward Is “Shorter, Cheaper, and Closer to Home”: The Tourism Industry Will Recover Even Without Inbound Tourism!

Hoshino Yoshiharu, CEO, Hoshino Resorts   One of the industries most severely hit by the COVID-19 pandemic has been the tourism industry. Some small and medium-sized traditional inns have even gone bankrupt, so what can be done to revive the tourism industry? Bungeishunju asked HoshinoYoshiharu, CEO of Hoshino Resorts, who is the manager of luxury traditional inns and hotels.   The declaration of a state of emergency was lifted and travel across prefectural borders was once again permitted starting on June 19, so people are gradually returning to the tourist attractions. The tourism industry lost a major market in the so-called Golden Week due to the COVID-19 outbreak, so it’s positive that this development started speeding up ahead of the important summer season. It felt like there was a glimmer of hope. The number of reservations for the facilities we run in Japan are ... ... [Read more]

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No.62

Looking Back at Prime Minister Abe’s Diplomacy: A Political Legacy of the Long-term Abe Administration—Leadership for liberal international order

Kanehara Nobukatsu, Former Assistant Chief Cabinet Secretary, Professor of Doshisha University   Interview by Nakamura Kiichiro, Editor-in-Chief of Gaiko (Diplomacy)   ――Professor Kanehara, you were appointed Assistant Chief Cabinet Secretary with the formation of the second Abe Cabinet. Prof. Kanehara Nobukatsu: I remember suddenly being told to go to the Prime Minister’s Office on December 28, the day the Abe Cabinet was formed. When forming the Cabinet, a team of three was set up under Chief Cabinet Secretary Suga Yoshihide and Deputy Chief Cabinet Secretary Sugita Kazuhiro. It consisted of Assistant Chief Cabinet Secretary for Internal Affairs Sasaki Toyonari (from the Ministry of Finance) (later replaced by Furuya Kazuyuki), Assistant Chief Cabinet Secretary for Security Takamizawa Nobushige (from the Ministry of Defense), and myself who was in charge of External Affairs. We had excellent teamwork.   ――What was the feeling at the time of ... ... [Read more]

No.62

What of the United States? Or Japan? New Visions of Leadership under COVID-19: How Will Leaders Engage the Libertarian Youths Sweeping over the World?

Uno Shigeki vs Watanabe Yasushi The True Nature of Leaders Uncovered in Crisis ―What are your views on the success stories and failures of different countries’ leaders in their COVID-19 responses? Uno Shigeki: When it comes to COVID-19 measures, it’s said that the East Asian countries that have taken a micro approach of tracking individual behavior have been more successful that the European countries that have focused on lockdowns. However, the causal link between differences in policy and the infectious spread is complex. It’s true that the exposure of political leaders has surged due to increasing social media contact by staying at home, but it’s still unclear what difference it’s made in terms of preventing infections. Having said that, it’s also not so that it’s the same the world over. As the first stage of focusing solely on preventing the spread of the virus ... ... [Read more]

No.62

How should Japan approach China, a country that takes a hardline stance against the backdrop of insecurity in the world order?

Kamo Tomoki, Professor, Keio University   Key points China aims to embed its requests into the current world order Both cooperation and coercion, two conflicting concepts, are prominent in its diplomacy with major countries Japan should present a new world order that includes China   China’s external actions are growing tensions in the Asia-Pacific region due to the deepening of the US-China trade friction.   The Communist Party of China (CPC) established developmentalism as one of its slogans and is on a path of reform and open-door policies in which its ruling guarantees internal and external environments that must be established to support the slogan. Through its diplomacy, China aims to facilitate reform and open-door policies; that is, to establish a stable international environment that secures development. It has already accomplished high economic growth and is in the process of becoming a middle-income country. ... ... [Read more]

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No.23

Feature Article on Scientific Advice: Paradigm Shift in Scientific Advice Responsible Innovation, Post-Normal Science, and Ecosystemic Approach

Growing expectations and skepticism about “scientific advice” “Scientific advice,” which provides the government, corporations and individuals with useful technical information, knowledge and judgments on the policy issues related to science and technology, such as “risk” issues in food safety, emerging infectious diseases, climate change, earthquakes, nuclear power and cyber security, and as promotion of science, technology and innovation, is expected to play an increasingly vital role in contemporary society. Scientific advice in Japan has hitherto been undertaken by various deliberative bodies and organizations, including councils and committees attached to government ministries and agencies, regulatory bodies such as the Food Safety Commission, and, regarding comprehensive policies for the promotion and regulation of science, technology and innovation, the Cabinet Office’s Council for Science, Technology and Innovation (CSTI) and academic organizations such as the Science Council of Japan (SCJ). In addition, since the Great East Japan Earthquake ... ... [Read more]

No.23

Feature Article on Scientific Advice: Between Science and Administration The Politics of Scientific Advice

(1) Is It Reactionism?  Members of the Subcommittee that deliberated on the draft of the Basic Energy Plan were replaced following a government changeover. In a blatant selection of personnel, the LDP almost exclusively appointed new experts who advocate maintaining or promoting nuclear power generation. The Agency of Natural Resources and Energy has already sent officials to an LDP working group meeting for explaining the draft of the Basic Energy Plan, wherein LDP-affiliated Diet members raised questions about the draft, which positions nuclear power as an important base power source and spells out steady promotion of the nuclear fuel cycle.The Fukushima Daiichi Nuclear Power Plant accident on 11 March 2011 has been taken as an opportunity to question the ideal form of giving scientific and expert advice to administrative authorities. A variety of criticism has been heard and many proposals made concerning this question, ... ... [Read more]

No.23

The Choice of Collective Self-Defense—Getting Out of the Galapagos Security Perspective Winning a Mandate in the House of Representatives Election — We Will Continue to Consult with New Komeito

Ishiba Shigeru, Liberal Democratic Party Secretary-General (currently, Minister in charge of Overcoming Population Decline and Vitalizing Local Economy in Japan, Minister of State for the National Strategic Special Zones) Japan Cannot Operate Only with a Right to Individual Self-Defense The use of the right to collective self-defense has long been discussed in the context of Japan’s national security. Why do you think Japan should shift its defense policy and decide to endorse the use of the right to collective self-defense now? Ishiba Shigeru: The biggest reason is that the security situation surrounding the post-Cold War Asia-Pacific region is very unstable. The balance of power between the United States and the former Soviet Union was stable during the Cold War. In that situation, the seeds of conflict, such as religion, race, territory and political structure, did not surface. We see China rising and increasing its ... ... [Read more]

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No.62

What of the United States? Or Japan? New Visions of Leadership under COVID-19: How Will Leaders Engage the Libertarian Youths Sweeping over the World?

Uno Shigeki vs Watanabe Yasushi The True Nature of Leaders Uncovered in Crisis ―What are your views on the success stories and failures of different countries’ leaders in their COVID-19 responses? Uno Shigeki: When it comes to COVID-19 measures, it’s said that the East Asian countries that have taken a micro approach of tracking individual behavior have been more successful that the European countries that have focused on lockdowns. However, the causal link between differences in policy and the infectious spread is complex. It’s true that the exposure of political leaders has surged due to increasing social media contact by staying at home, but it’s still unclear what difference it’s made in terms of preventing infections. Having said that, it’s also not so that it’s the same the world over. As the first stage of focusing solely on preventing the spread of the virus ... ... [Read more]

No.60

Udo Yumiko’s My Fair Person: What Can Be Seen from the COVID-19 LINE Survey―Miyata Hiroaki, Professor, School of Medicine, Department of Health Policy and Management of Keio University

UDO Yumiko vs Prof. MIYATA Hiroaki   Udo Yumiko: Nice to meet you, Professor Miyata. This is my first time talking online with someone that I’ve never met in person before. Professor Miyata Hiroaki: I’m honored!   Udo: Professor Miyata, you proposed the “Early SNS-Based Monitoring System for the COVID-19 Outbreak in Japan: A Population-Level Observational Study,” gathered massive amounts of health data from many people, and continue with efforts that utilize the next move in COVID-19 measures in cooperation with local governments and the Cluster Response Team of the Ministry of Health, Labour and Welfare (MHLW). Miyata: Of the approximately 83 million LINE users in Japan, we received responses from about 25 million during the first survey, held from March 31 to April 1. With a response rate of about one-third, it was the second largest survey in Japanese history, excluding the national ... ... [Read more]

No.59

Three Experts Discuss: Will the China Model Conquer the World? What Will Happen? The Xi Jinping System After COVID-19

Miyamoto Yuji (former Ambassador of Japan to the People’s Republic of China, Chairman of the Miyamoto Institute of Asian Research), Kawashima Shin (Professor, University of Tokyo), and Ako Tomoko (Professor, University of Tokyo) What COVID-19 Has Brought to Light Miyamoto Yuji: COVID-19 has shaken many of the world’s fundamentals, revealing things that hadn’t been visible before. One is US–China relations. For example, the US’s strictest policy against China is decoupling, but COVID-19 has stopped the movement of people, severed supply chains, and had a major negative impact on the US economy, so is it really possible to establish a decoupling relationship with China? Also, until now, the Xi Jinping administration has talked about the “China Dream” to build a country peerless in the world by the mid-century, but isn’t that a dream founded on extremely optimistic predictions? I hope that China can make this experience ... ... [Read more]

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Blog

Legacy of “Japonisme 2018” (II): From a Japanese Art Exhibition to a Manga Exhibition at the British Museum

Miura Atsushi, Professor, University of Tokyo   The gist of my previous blog entry was that, although unknown to what extent the organizers were aware of this, from a historical point of view, the monumental event that was “Japonisme 2018” was an exhibition of Japanese culture that had its roots in the Japan exhibitions at the international expositions of the nineteenth century while also connecting to the national policy of exporting culture in anticipation of a second Japonisme boom. I want now to comment on the actual exhibitions with a focus on the art exhibitions, but it is not that I was able to see all the exhibitions. Because I went to France in the third week of December 2018, I missed “FUKAMI: Une plongée dans l’esthétique japonaise” (Hôtel Salomon de Rothschild), “Jakuchu: Le royaume coloré des êtres vivants” (Petit Palais), “Jomon: Naissance de ... ... [Read more]

Blog

Challenges in the Post-coronavirus World

Kojima Akira, Member, Board of Trustees, and Adjunct Professor, National Graduate Institute for Policy Studies (GRIPS); Trustee, Chairman of the World Trade Center Tokyo   In mid-April, the International Monetary Fund (IMF) announced a significant downward revision of its growth projection for the world economy in 2020, from the 3.3% it had announced just three months prior, to -3.0%. Nonetheless, the new estimate is based on the assumption that economic activities will normalize after the COVID-19 coronavirus outbreak is contained in the latter half of the year. The IMF has even started to use the term “the Great Lockdown.”    Although the quick development of an effective drug is expected, it should be assumed that the coronavirus pandemic may be prolonged or that a second or third wave of the coronavirus outbreak may occur. It is essential to resolutely deal with the current situation ... ... [Read more]

Blog

Legacy of “Japonisme 2018” (I): Transitioning from International Expositions to Exhibitions of Japanese Culture

Miura Atsushi, Professor, University of Tokyo   I still remember the large cultural event titled “Japonisme 2018,” which was held in France in 2018. That year marked the 160th anniversary of the establishment of diplomatic relations between Japan and France, the 150th anniversary of the Meiji Restoration, and the 150th birthday of Paul Claudel, the writer and diplomat who contributed to French-Japanese relations. Such a large-scale event themed on Japanese culture was rare in France, although anniversary events are common. It was magnificent that over fifty intriguing projects representing Japanese culture were implemented across France from July 2018 to February 2019, such as fine art, acting, movies, food, literature, dance, manga and anime (Fig. 1).   I was lucky to see four exhibitions related to “Japonisme 2018” when I visited Paris in December 2018. Based on the impression from my visits, I would like ... ... [Read more]

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