Week of March 14, 2016
- The Diplomat, still viewed as one of the best online magazines, published two interesting articles about Japan’s energy policy. The first is about a critical part of Japan’s nuclear ambitions: reprocessing of nuclear waste. To construct a reprocessing facility in Aomori, North-Japan, is very, very expensive. It will cost the Japanese tax payers a total of 11 trillion yen (USD 97 billion) over the years (for construction, operation and eventually, dismantling), while the storage of nuclear waste is not a very popular, not in Aomori-prefecture, not anywhere else in Japan.
The second article is about Japan’s energy security and the way it influences Japan’s foreign policy. Apr. 65% of all oil and gas imports for Japan’s energy needs pass through a contested part of the South-China Sea. This implies defense pacts and economic cooperation with countries in the region other than China.
- China’s policy in “its” South-China Sea is clear: Claim & Construct. Deutsche Welle has a clarifying article with some pictures on what is happening in this part of the world.
- Creating inflation is best served by substantially higher wages - and alas, this is not happening in Japan at this moment. Is it the end of “Industry Policy” as practised in Japan in the ’60 - ’80 of the previous century? Anyhow, the moderate wage increases are a blow to Abenomics (and so: PM Abe), but also to the Bank of Japan (Financial Times).
- The Financial Times carried an interesting article of Japan’s once-industry policy. "At the height of its powers in the 1970s, Japan’s ministry of international trade and industry could turn spoons into golf clubs. But the men from the ministry were not only interested in persuading the cutlery makers of Tsubame City to retool themselves as producers of sports equipment. They also pulled the same trick on other industries, too, transforming them from one shape into another and bending segments of the economy to their will.” Now the question for Japan is: how to counter the Chinese industry, that is clearly steered by its ambitious government. So: Japan Industry Policy Redux, and now, like then, it is to create strong champions in various fields, incl. nuclear energy and semicon.
- Last week non-Japanese investors offloaded massively their Japanese stock: they sold JPY 1.19 trillion (USD 10.6 billion) more in Tokyo and Nagoya stocks than they bought over the week ended March 11, Tokyo Stock Exchange data released Thursday shows. This is the largest such differential in statistics going back to July 1982 (Nikkei).
- Sharp’s planned sale to Taiwanese company Foxconn wouldn’t be an example of industry policy, as the METI, Japan’s Ministry for Economy, Trade & Industry, would prefer a JV between Sharp and Japan Display. However, the due diligence process so far hasn’t providing enough comfort to envisioned new owner Foxconn. Nevertheless, a deal is expected before the end of this month. And for Japan’s banks it is the best solution as it will be a better deal for them than when Sharp will be put together with Japan Display (Nikkei).
- Like Sharp, also Toshiba has been nicknamed a Zombie company. It is in a full restructuring process now, while its shareprice has dropped 61% over the last 12 months. Last week Bloomberg News reported that the U.S. Justice Department and the Securities and Exchange Commission are probing the electronics maker's accounting. Another 8% down. Other sources reported that 34.000 of its employees will have to leave. The medical division will be sold to Canon (Bloomberg Gadfly).
- An outright success is Toyota and here the story how the Prius was developed - and the Mirai, Toyota’s fuel-cell car. Fascinating to read how a Japanese company can set the global scene by acting decisively (Financial Times).
- Ignition, a Japanese online magazine, reviewed the status quo in the tsunami-hit area and they went to Kamaishi, Iwate prefecture. Here a report on reconstruction - also as Kamaishi has been chosen as one of the host cities for the 2019 Rugby World Cup, scheduled for Japan.
- In The Netherlands we have weed, the Japanese have knotweed. Our weed is looked after by many foreign visitors in Amsterdam. Knotweed is an export product of Japan. But Japanese knotweed is without question one of the most damaging of all introduced alien plants, writes the Financial Times. The International Union for Conservation of Nature and Natural Resources has listed it as a global plant pest. In parts of Australia it is illegal to have the plant on one’s property, while in New Zealand it is classified with polite understatement as an “unwanted organism”. The annual cost to the UK of controlling and eradicating this pernicious weed is between GBP 160m and 200m. There are no limits to the places the pest will get to: private homes, rail tracks, industrial estates, school grounds. In this article you will read who introduced the knotweed to Europe: … Franz von Siebold. Great story.
- Introducing the newest Japanese boy-bands: The Sekko Boys. 4 men, Mars, Medici, St. Giorgi and Hermes. "He is strong and fashionable," a woman in her 20s said of Mars, the Roman god of war. Well built they are the idols for many women - and even men and wherever they show up: screaming fans. However, the four young men are … plaster busts. Amazing story in the Nikkei.