2023年

Economy

Japan’s Economic Transition in the Global Context

The recent depreciation of the yen has ignited a multifaceted discussion about its consequences and the evolving landscape of Japan’s economy. While this depreciation has certainly bolstered the export sector and improved corporate performance, it has also raised concerns about the impact on the average citizen’s purchasing power. Japan’s persistent structural trade deficits and its significant reliance on government spending have provided a safety net against fiscal collapse. However, this approach has come at the cost of eroding the credibility of its currency on the global stage. The currency markets bear the brunt of these adjustments, leading to the continuous depreciation of the yen. While this may benefit exporters and...
Politics

Breaking Barriers: Japan’s Communist Party on the Brink of Historic Leadership Change

The Communist Party of Japan, a political mainstay for over a century, is poised for its first leadership change since 2000, with Tomoko Tamura, the 58-year-old policy chief, set to make history as the party’s first female leader. Amidst dwindling support for opposition coalitions and organizational weakening, this surprising appointment could be a strategic move to revitalize the party’s influence. Tamura’s rise to prominence was sealed at the 10th Central Committee General Assembly, where she took the helm from Kazuo Shii, the incumbent leader, to propose a draft resolution for the party’s 29th Congress in January 2024. Her powerful closing speech, echoed by the party’s newspaper, ‘Shimbun Akahata,’ marked a...
Academic

Japan’s Scientific Downfall: A Call for Revival in Research and Innovation

Blog Article: A recent article on the prestigious scientific journal Nature’s website, dated October 25, delivered a stark message: Japan’s research capabilities no longer align with global standards. This revelation is significant, given Nature’s influence in the scientific community. The report is based on findings from the Japanese Ministry of Education, Culture, Sports, Science, and Technology’s think tank, which published the ‘Science and Technology Indicators 2023’ on August 8. The data paints a bleak picture: Japan, once a research powerhouse, now ranks fifth in terms of the number of research papers published and a dismal thirteenth in top-cited papers. This decline is stark compared to Japan’s earlier standing – second...
Politics

Rising to the Challenge: Japan’s Quest for a Stronger Defense Industry Presence

October 2023 marked a significant moment in the global defense industry with the Seoul International Aerospace & Defense Industry Exhibition. South Korean President Yoon Suk-yeol proudly declared the nation’s transformation from a defense importer to an advanced fighter jet exporter. With ambitions to secure a 5% share in the global arms market by 2027, South Korea’s defense exports in 2022 reached approximately 2.59 trillion yen, ranking around the world’s top 10. In contrast, Japan’s approach to defense equipment transfer, as outlined in the recently approved security documents, focuses on strategic foreign policy and nurturing the defense industry’s growth. However, discussions between Japan’s ruling Liberal Democratic Party and Komeito have been...
Economy

Navigating Japan’s ‘Poli-Crisis’: Debunking Fiscal Discipline Amid Global Turmoil

At the October 10th Economic and Fiscal Advisory Council meeting, focused on economic measures, BNP Paribas Securities member Mana Nakasora, known for her fiscal conservatism, asserted it was time to revert Japan’s finances to normalcy post-pandemic. Finance Minister Shunichi Suzuki echoed this, emphasizing the need to focus on normalcy. Yet, this rhetoric seems disconnected from global realities. Just days before Nakasora’s statement, Hamas launched attacks on Israel, a stark reminder that global conflicts like the ongoing Russia-Ukraine war directly impact Japan through surging energy and food prices, inducing cost-push inflation. While the pandemic may be receding, with COVID-19 reclassified in Japan from Category 2 to 5 in May, the resulting...
Politics

Japan’s Kishida Faces Growing Discontent: A Dive into Tax Cuts and Political Strife

Amidst an unrelenting disaffection towards Prime Minister Fumio Kishida, widely nicknamed ‘Tax-Hike Kishida’ on the internet, a substantial economic package exceeding 17 trillion yen was announced, aiming to counteract his image with income tax cuts. However, these tax reductions have stirred criticism not just from opposition parties but also within his own Liberal Democratic Party (LDP), leading to a further decline in cabinet approval ratings. The situation within the LDP appears especially fraught, with internal criticism hinting at a struggle for leadership ahead of a potential general election, stirring up speculations about Kishida’s successor. A critical point was the Senate plenary session on October 25th, following Kishida’s policy speech. The...
Economy

Unleash the Power of New NISA: Tax-Free Investing with No Limits

The New NISA (Small Investment Non-Taxable System), central to Prime Minister Kishida’s “Asset Income Doubling Plan,” is launching in January 2024. It offers a “Monthly Accumulation Investment Frame” for investment trusts and a “Growth Investment Frame” for stocks and investment trusts. With generous annual limits—¥1.2 million for Monthly Accumulation and ¥2.4 million for Growth, a lifetime cap of ¥18 million (¥12 million for Growth)—New NISA can cater to diverse investment needs. For asset management firms, not having their investment trusts qualify for New NISA can be a blow. This fear has led to a trend of exploring loopholes, resulting in what some might call “hidden actions.” To qualify for New...
Economy

A Cascade of Errors: The Nationwide Banking System Meltdown in Japan”

A major mishap in Japan’s banking sector has caused a seismic shift in public trust, which took half a century to build. The National Bank Data Communication System (Zengin System), crucial for inter-bank transfers and foreign exchange transactions, experienced a catastrophic failure on October 10th, affecting 10 major financial institutions including Mitsubishi UFJ Bank and Resona Bank. For two full days, these banks were unable to process transfers, disrupting millions of transactions. The Zengin System is operated by the National Bank Funds Settlement Network, a subsidiary of the Japanese Bankers Association (JBA), which is overseen by executives from major banks. More than a month since the incident, the issue remains...
Economy

Digital Salary Dilemma: The Waiting Game for Cashless Payouts in Japan

In Japan, a significant shift in wage payment methods is on the horizon with the legalization of “digital salaries” effective April 1 this year. This change allows companies to pay wages through cashless payment accounts like PayPay, revolutionizing the traditional cash-based salary system. Since 1975, salary payments were primarily made in cash, with bank account transfers becoming an accepted method, followed by securities comprehensive accounts in 1998. The addition of cashless payment accounts as an acceptable medium for wage distribution marks a significant evolution. However, this transition has hit a roadblock. PayPay and other financial transfer service providers like Rakuten Pay and KDDI (au Pay), along with Recruit MUFG Business’s...
Art

The Art of Survival: The Ise Collection’s Journey from Egg Empire to Auction House

The intriguing tale of Hikonobu Ise, a 94-year-old art collector and owner of Ise Foods, known as the “Egg King” internationally, is set to unfold at Sotheby’s New York on November 13th. A portion of his esteemed art collection, including Monet’s “Poplars on the Epte,” valued between 4.47 to 5.96 billion yen, will be auctioned off. The “Modern Evening Auction,” starting at 7 PM, will feature masterpieces of Impressionism, Surrealism, and Cubism. From the Ise Collection, Marc Chagall’s “Over the Town” (estimated at 1.78 to 2.68 billion yen), Paul Cézanne’s “Blue Plate” (450 to 750 million yen), and Monet’s aforementioned “Poplars on the Epte” will be up for bidding. Additionally,...