Nor is it intended to suggest that privatisation of the postal savings system-the reform issue around which September's election was fought-will somehow magically turn Japan from a sloth economy to a growth one, for it won't. It is not based on any notion that Mr Koizumi's victory represents the start of radical change. It also rises, and looks likely to do so from now on.įor the case for greater optimism is also strong. Hence the somewhat self-indulgent title of this survey: the Japanese sun does not only set, either. Since 1990, the opposite mistake has been made: just because some things have gone badly wrong, so everything has been assumed to be wrong, in perpetuity or at least pending a revolution. Japan's sun does not only rise, the book argued trends can also bring about their own downfall. That is why your present author named a book he published in 1989 “The Sun Also Sets”. During the 1980s, when adulation (or fear) of Japan was at its peak, many observers made the mistake of assuming that because some things in the country plainly worked extremely well, everything did, so everything must be worth emulating and the trend must be ever upwards. Politics didn't even come into it.īut remember.
Moreover, the OECD recently rated Japan's potential rate of GDP growth for the rest of this decade at a mere 1.3% a year, on the basis of poor productivity growth and a population that is shrinking and ageing. Since 2001 it has had a prime minister, that same Mr Koizumi, who has talked a lot about reform but whose real achievements remain rather hard to get your arms around. Since then, Japan has suffered a price deflation that has still not come to an end.
There have been several false dawns during those 15 dismal years, most notably in 1996-98 when an incipient recovery turned into a fresh recession and produced both a banking crisis and an apparent enthusiasm for reform. After all, the case for cynicism is compelling.
Really? The very unJapanese event that took place on September 11th-a snap general election called on a policy issue and won in spectacular fashion by the reformist prime minister, Junichiro Koizumi-has changed perceptions of Japan as an irredeemable dud, but not much. Now, however, the time for lectures is over. Those lectures, although received politely by a newly self-deprecatory Japanese elite, seemed to be ignored. In the 15 years that followed, amid crashing stock- and property markets, mountains of dud debt, scores of corruption scandals, vast government deficits and stagnant economic growth, Japan mutated from being a giver of lessons to a recipient of lectures, all of which offered recipes for its reform and revival. NO COUNTRY in modern history has moved so swiftly from worldwide adulation to dismissal or even contempt as did Japan, in a process that began more or less as the temple bells were tolling in the new year of 1990.
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