Nikkei suggests that the solution to reversing the decline of the regions is two-fold. First, Japan’s prefectural governments need to do a better job attracting foreign direct investment. The editorial notes that Japan has been uniquely resistant to FDI, and, in light of China’s active courting of foreign companies, further resistance will handicap Japan’s economic prospects in an Asia dominated by China. Second, prefectural governments need to attract more tourism.
In other words, Japan needs to become genuinely globalized.
This editorial is interesting in light of this story from CNN, which notes that Toyota has become one of America’s “Big Three” automakers. Toyota has been extremely successful in investing in regions of the US that might otherwise have been left behind by globalization, parlaying its investment in the US into substantial sales.
Now Japan needs the reverse to happen, but, as the editorial notes, Japan’s high costs and the weak yen make Japan a perpetually unattractive place to invest.
Nikkei suggests that the regions could become IT platforms, and why not — why can’t Japan have its own clusters? For the moment, however, Japan remains too centralized politically and economically for this to be a short-term solution.
Ozawa Ichiro called for a more decentralized Japan in his 1993 book Blueprint for a New Japan, but after thirteen years Japan has, if anything, become more centralized. Not surprisingly, then, Ozawa’s DPJ has made stronger regions and communities a fundamental principle in their newly released policy index. But I have my doubts as to whether any Japanese government would have the wherewithal to initiative a regional development policy that actually devolves power to prefectures and cities and enables them to pursue their own path to development.
Perhaps as Japan considers revising its constitution, it should consider changing from a French-style system, in which power is concentrated in the capital, to a German-style federal system, in which prefectures would be accorded considerable autonomy. The Japanese Upper House, were it to become more like Germany’s Bundesrat, could actually become a capable, muscular organ with responsibility for regional development.
Just a thought…I mean, as long as Japan is going to undertake the effort to consider constitutional revision, the government might as well do the job right and seriously consider how all of Japan’s postwar institutions should change to better enable the country to survive and thrive in the twenty-first century.