Week of August 1, 2016
- Coming Monday August 8 at 15:00 JPT, Emperor Akihito will address the Japanese in a video message, most probably expressing his worries about the fulfilment of his tasks due to age (82) and health reasons. It will only be the Emperor’s second video message, following one released five days after the massive earthquake and tsunami that hit parts of the Tohoku region on March 11, 2011.
Can a Japanese Emperor abdicate? No, under the current law, he can’t, even if he wants to. However, abdication was relatively common until 1817, when Kokaku became the last Emperor to resign his post. But the imperial system underwent a huge upheaval at the end of World War II, when the U.S. occupying forces allowed Hirohito, the current Emperor’s father, to remain in his position but stripped him of his powers, wrote the Washington Post this week. The Emperor was reduced to being a ceremonial figurehead who would serve as a “symbol of the state and of the unity of the people.” This article in Reuters suggests that Emperor Akihito may have taken as an example the abdication of now Princess and former Queen Beatrix - and as known the Dutch and Japanese royal / imperial families maintain excellent personal relations.
- Ms. Yuriko Koike, former Minister of Environmental Affairs (she was a speaker at a DUJAT seminar in Tokyo in 2008) and of Defense, was elected last Sunday as new Governor of Tokyo. Fluent in Arabic (she studied in Cairo) and with an impressive career as anchor woman in a news show, she knows how to communicate. Her stated basic principles and stance regarding political reform is encompassed by "The 5 Cs: Check, Challenge, Change, Creative and Communication”. "I’m not interested in whether they like me or not. In politics, I think it’s necessary to be disliked,” is what she told last week in a pres conference. “Ms. Koike’s real problems begin now”, writes the Financial Times. "Her campaign was light on policy content but she vowed to make the cost of the Olympics transparent, to clean up Tokyo politics and to eliminate waiting lists for childcare.” Interestingly enough, Japan's new defense Minister is a woman also: Ms. Tomomi Inada, and reportedly is as steely as her predecessor Koike.
- Meanwhile a fleet of over 200 ships, the bigger part fishing boats but accompanied by armed coast guard ships, has approached the Senkaku islands, disputed by China. Tokyo and Beijing in 2008 agreed to develop gas fields in the East China Sea. But the joint effort was effectively put aside when territorial disputes between the two nations escalated in 2010 after a Chinese fishing boat rammed a Japanese patrol ship. Besides this, China is building structures, whose main purpose is thought to be tapping gas fields, and could also have military functions. The Japanese ministry of Defense posted new photos of the structures on its website. The day before, Tokyo complained to Beijing through diplomatic channels. The ministry claims one of the 16 structures, the first confirmed sighting of which came in June 2015, now has surface radar equipment and a surveillance camera. The radar unit was spotted under the structure's heliport. It is the first radar unit confirmed on any of the 16 structures.
- "So this week the government of Prime Minister Shinzo Abe proposed a new fiscal stimulus package”, writes Bloomberg. Big numbers from the outside, but when you look into them “it is moderately sized: about USD 45 billion this year, and about USD 60 billion in low-interest loans, to be followed by slightly less next year.” But Bloomberg thinks it will yield little effect and the chart in this article shows that since 1992 no less than 26 economic stimulus packages have been launched, all with the fanfare of much money but eventually with only little new money (“fresh water”). One of the projects for fresh money is to speed up the construction of Japan’s maglev train project between Tokyo and Osaka.
- Also The Economist doubts if this package will work and states that like its maglev trains, Japan’s economy must build up velocity before it can levitate. "To speed it up, some unconventional policies may be necessary. But there is always the worry that such policies might send Japan’s economy off the rails altogether.”
- What is Japan’s most valuable industry? Automotive you might say. No, it is the telecom industry. Ominous sign: only in 2008 this happened, at the height of the financial crisis (Bloomberg).
- Executive pay in Japan: it is in no way to be compared to that in the US or even Switzerland and Germany. The Economist carried an article about the transparency of executive payments. In 2010 the securities regulators required listed companies to disclose, for the first time, all bosses earning above JPY 100 mln, apr. EUR 900K. The idea was to increase transparency for investors (before, companies disclosed only the sum of the total executive-pay pot, for shareholder approval). There were hardly any that met the threshold - in 2014 only executives at 9% of listed firms had to be outed. "Still, there has been progress. The number of bosses earning JPY 1 mln, or enough to require disclosure, has risen from fewer than 300 to just over 500 since 2009.”
- Japanese companies might be on a buying spree, they are unhappy about the performance of their acquired companies, writes the Nikkei. The article focuses at Japanese acquisitions in Asia, but I think that at least partly the conclusions are valid in Europe. "The biggest factor in a takeover is the business plan," said Kazuyoshi Nishitani, a partner and Japan desk leader at PwC Advisory Services, based in Singapore. "In many cases, the corporate headquarters in Japan leads the takeover and creates a new business plan without the input of the team on the ground," he said. "Companies talk of synergies when announcing the takeovers, but the reality is that these synergies are just a means of adjusting the purchase price," leading to disappointment after the takeover is completed.
- What went wrong in Mitsubishi Motors when it became clear that the company cheated with its mileage date? An investigative panel said Tuesday such data falsifying went on for 25 years, and the wrongdoing was systematic, extensive and escalated with time. The probe, which included interviews with more than 150 people, found the company lacked a system for checking on the team assigned to improve mileage. The company said employees did not feel compelled to respect the law or fix the wrongdoing and each department was concerned only with its own performance.”, wrote Japan Today.
- In Japan, school curriculum guidelines are reviewed about every 10 years because teaching priorities are viewed as changing in line with society, writes Japan Today. A panel of the education ministry unveiled its proposed curriculum guidelines Monday, including a plan to teach English as an official course from the fifth grade at elementary level to better prepare students for an international environment. The panel also proposed that English activities, centred on listening and speaking skills, should be taught from the third grade, earlier than the fifth grade under the current system. The new envisioned guidelines for elementary and high school education, hammered out by the panel of the Ministry of Education, Culture, Sports, Science and Technology, are designed to allow students to focus on “how to learn” instead of “what to learn.”
- Great read about housing and house construction in Tokyo. Japanese urbanism, with its “scramble” pedestrian crossings, its narrow streets, its dense population and its superb public transport is looked to as a model, certainly in Asia, and increasingly across the rest of the world as well, states Robin Harding, the FT’s Tokyo chief. "Most of all, Tokyo is fair. The ugliness is shared by rich and poor alike. So is the low-cost housing. In London, or in San Francisco, all share in the beauty, but some enjoy it from the gutter; others from high above the city, in the rationed seats, closer to the stars.” But remarkably enough, the increase of real estate prices in Tokyo can in no way be compared with those in London, Amsterdam or San Francisco.
- And to finish on an upbeat note: here an article about the end-of-life industry in Japan from The Economist. It is a JPY 2 tln or EUR 18 bln industry that is changing rapidly. Less rituals, environmental friendly coffins that you can check beforehand and rent-a-monk services.
- Japan’s new economic package explained in video: More stimulus for Japan, but will it help the economy?
- North-Korea launched a rocket that ended up in Japan’s economic zone. https://www.youtube.com/watch?v=f7av3fPpFL4 and North Korean Missile Lands Near Japan
- Chinese ships approaching Japanese waters: 230 Chinese Vessels Enters Japanese Water