Category Archives: BUSINESS

Moving beyond GDP: Well-being and degrowth development alternatives

Moving beyond GDP: Well-being and degrowth development alternatives

The financial crisis of 2008 sent shock waves across the world as economies collapsed or were severely damaged or crippled. Since then, many other crises have ensued, covering issues including debt, finance, stock markets, the environment, natural disasters, society, social media, governance institutions, politics, the nation state, and, most recently, global health pandemics. In a rapidly changing world, the number and frequency of global crises have not slowed or decreased. Rather, such crises are mounting, accelerating, and recurring.

A number of eminent scholars are increasingly turning their attention to the question of what trends the growing frequency of crises might have in common. Nobel-prize winning economists including Amartya Sen and Joseph Stiglitz suggest that the increasing occurrence of crises illustrates the limitations of the dominant growth-led development paradigm. Additionally, they argue that what is being measured as a yardstick of “progress”—and perhaps the yardstick itself—is deeply flawed and no longer viable.

The critique of growth is not surprising because the creator of the world’s first set of gross national product accounts in the 1930s, Simon Kuznets, would later become one of the greatest critics of his own invention, noting that the welfare of a nation cannot be inferred from the measurement of income (Cobb, Halstead, and Rowe 1995: 68). Indeed, there are several problems with using gross domestic product (GDP) as a measure of progress:

  • GDP is unable to distinguish between bad and good economic activities, whereby government expenditure in education and oils spills that need to be cleaned up both contribute to GDP (O’Neil 2015). In this regard, war, crime, and environmental destruction all problematically contribute to the main quantitative indicator of national progress.
  • If GDP is a calculator with a giant “plus” button but no “minus” button, then it cannot capture the social, cultural, and environmental costs and impacts of productive activities …continue reading
        

Japanese residents stay, while foreigners exit central Tokyo

The population of the Tokyo metropolitan area as of November 1 had dropped by 7,358 from the previous month to 13,847,040 residents. This is the first time since 1993 that the month of November had seen a month-on-month decrease. Recent news articles have been pointing the finger at the work-from-home trend and an exodus to surrounding prefectures as the main cause of the decline, and while that may be the cause for some of the numbers, the same articles gloss over the startling outflow of foreign residents.

Almost half of this month’s drop is attributed to an outflow of foreign residents. The foreign resident population shrank by 0.56% from the previous month, while the Japanese population dropped by 0.03%.

Since the pre-covid peak in February 2020, the number of foreign residents in Tokyo has fallen by 7.4%. Over that same period, the Japanese population has increased by a slight 0.4%. The foreign population has dropped by 42,769 residents over the past 9 months. In the 9 months following the 2011 Tohoku Disaster, 11,865 foreign residents left Tokyo.

For the past 3 months, the Japanese population has been shrinking by a little over 4,000 residents month-to-month.

Central Tokyo

What happens when you zoom in on the resident population of the central three wards of Chiyoda, Minato and Chuo? If the exodus out of the city center in search of safer, greener pastures was occurring, there should be a corresponding drop in the population of these three highly central locations, yes?

Well, when looking at the Japanese resident population, the population increased by 72 over the past month and has grown by 3,415 residents between February and November.

<img …continue reading

    

How COVID-19 has affected Japan’s official development assistance

Warehouse staff prepare aid equipment, including tents and generators, to be delivered to Myanmar at a warehouse in Singapore 6 May 2008. Countries worldwide promised help to Myanmar after Cyclone Nargis killed 10,000 people in just one town, suggesting the overall death toll in the impoverished military-run Southeast Asian nation will be much higher. The aid was organised by the Japan International Cooperation Agency (JICA) (Photo: Reuters/Vivek Prakash).

Author: Yusaku Yoshikawa, JIN Corporation

In early March 2020, the Japan International Cooperation Agency (JICA) mandated the return of its experts engaged in official development assistance (ODA) projects abroad in response to COVID-19. This has forced JICA to implement its ODA projects remotely, created significant changes in Japan’s development practices and necessitated a re-evaluation of ODA basics.

The most popular form of Japanese ODA is project-based technical cooperation in developing countries. In fiscal year 2020, Japan ODA budget is approximately 561 billion yen (US$5.4 billion). This consists of 514 billion yen (US$4.9 billion) in endowments and 47 billion yen (US$0.5 billion) in yen loans. Endowments consist of bilateral aid (91.7 per cent) and multilateral aid (8.3 per cent) through contributions to international organisations like the United Nations. Bilateral aid predominantly comprises of technical cooperation (60.8 per cent) and economic development assistance (grant aid) (38.9 per cent) and mostly falls within the jurisdiction of the Ministry of Foreign Affairs of Japan.

Technical cooperation projects are managed by JICA and implemented by private consultancy firms and individual consultants. Experts are repeatedly dispatched to beneficiary countries for short-term periods to implement activities, coordinate with national staff and counterparts, and monitor progress.

Remote implementation of the projects is new for a majority of Japan’s ODA projects and creates a number of challenges. Distance between Japan and project countries impedes communication among stakeholders including experts, national staff, local recipients and authorities. Many countries are changing COVID-19 restrictions day-by-day, hindering aid delivery. Projects must also value the safety of national staff in project countries and consider preventive measures like teleworking. ODA’s public nature also demands that projects strictly follow the restrictions in project countries and go …continue reading

    

Abandoned temple grounds to be nationalized in country-first

The grounds of an overgrown and abandoned temple in Shimane Prefecture will be acquired by the national government in what will be the first of its kind.

The extraordinary step of nationalizing the property is to prevent the religious organization that owns the property from falling into the wrong hands where it could be used for tax evasion purposes. Normally, dissolving the organization would require the sale of the land and buildings. However, the temple is located in a rural and depopulated region where a buyer is unlikely to be found.

According to the Agency for Cultural Affairs and the Japan Buddhist Federation, there were approximately 3,528 non-operating religious organizations registered in Japan as of 2018. Religious organizations receive favorable tax treatment, making them an ideal target for criminal groups looking to evade taxes and hide assets.

Kinko Temple is a 20-minute drive from Oda City and 4-kilometers from the Sea of Japan. Its history dates back to the Warring States period in the 1400s and 1500s, with the temple registered as a corporation in 1953. Rapid depopulation of the surrounding area has seen parishioners drop to just 20 households, while the chief priest passed away in 2013 with no successor. The temple grounds include the main temple building and 30 acres of forest. Attempts were made to sell the property in the past but the risk of landslides and forest fires saw the prefecture, city and local forestry association refuse to take over the low-valued land.

A liquidator has been appointed to carry out the procedures for the property to be transferred to the national government by the end of the year. The main temple gate and belfry will be demolished as they pose a risk to neighbors, while the main temple building will be left to rot. Gravestones will …continue reading

    

Nike commercial addresses bullying and racism in Japan, riles up debate online【Video】

Video gets more dislikes than likes, proving just how much Japanese society needs to watch this right now.

Ever since their 1988 “Just Do It” ad, sports brand Nike has become known for producing commercials that spark a conversation and leave a lasting impression on viewers.

Last year, they got the conversation going around all the annoying questions tennis star Naomi Osaka has to deal with surrounding her ethnicity, and now they’re back to tackle another tough subject: the experience of young foreign residents in Japan.

The new commercial is called “Ugokashitsuzukeru. Jibun wo. Shorai wo. The future Isn’t Waiting“, with the Japanese part translating to “Keep Moving. Yourself. The future.” Featuring stories based on “the real-life experience of athletes”, this clip shows three soccer girls from different backgrounds in Japan — one is Japanese, one is Korean, and one is, like Osaka, mixed race, with a Black father and Japanese mother — and reveals how they “overcome their daily struggles and conflicts to move their future through sports.”

The commercial has English subtitles available, so click the white gear button next to the CC in the bottom right corner to turn them on, and take a look at the clip below:

The two-minute video is a moving look at what it can be like to be a young girl into soccer in Japan. The Japanese girl is bullied at school and struggles to meet her parents’ expectations to excel at schoolwork, with her questioning, “Am I good enough?

On the other hand, the Black Japanese girl struggles to blend in, wondering “Am I normal enough?” as her Japanese classmates stare at her for looking different and touch her hair in the girls’ …continue reading

    

A forecast of new apartment prices between 2020 and 2025

on November 26, the Japan Real Estate Institute (JREI) issued their most recent medium-term forecast for new apartment prices in Tokyo’s 23 wards. In 2020, the average price is forecast to be 1,071,000 Yen per square meter (approx. US$956/sq.ft). This is a slightly higher revision from their earlier forecast issued last year.

Despite the macro-economic standstill caused by this year’s coronavirus pandemic, there has been no immediate impact on apartment prices in the capital. Supply has shrunk, while demand remains high. In 2021, apartment prices are forecast to increase by 0.3% to 1,074,000 Yen/sqm as the economy recovers. Prices are forecast to increase a further 0.7% in 2022 to 1,081,000 Yen/sqm as the economy bounces back. For the years following, prices are expected to remain flat.

On the apartment rental side, monthly rents in 2020 are forecast to remain stable at 3,441 Yen/sqm. In 2021 they are forecast to be 3,442 Yen/sqm, dropping 0.3% in 2022 to 3,432 Yen/sqm, and seeing a further drop of 0.1% in 2023 to 3,430 Yen/sqm. In 2025 they are forecast to increase by 0.2% to 3,442 Yen/sqm as the economic recovery finally makes its way to the residential rental market – a sector of the real estate market that often lags behind sale price movements.

Forecasting future property prices is an impossible task for even the largest research institutes and data can be unreliable due to the unpredictable nature of the market and the factors influencing it. Back in 2014, the Institute forecasted that the average price of a new apartment would be 816,000 Yen/sqm in 2020, while the most recent forecast puts it at 1,071,000 Yen/sqm (a 31% difference).

ABOUT THE DATA

The Institute has been providing property market forecasts for Tokyo’s 23 wards since 1998. Reports are based on their own housing market index, GDP, private …continue reading

    

Legal hurdles remain in the Australia–Japan Reciprocal Access Agreement

Australia's Prime Minister Scott Morrison and Japan's Prime Minister Yoshihide Suga review an honor guard during a ceremony ahead of a meeting at Suga's official residence in Tokyo, Japan, 17 November, 2020 (Photo: Kiyoshi Ota/Pool via Reuters).

Author: Donald R Rothwell, ANU

On 17 November, the in-principle Tokyo signing of the Australia–Japan Reciprocal Access Agreement (RAA) by Australian Prime Minister Scott Morrison and Japanese Prime Minister Yoshihide Suga was hailed as a major step in the two countries’ bilateral relationship. The RAA was the headline announcement in Morrison’s one day visit. Yet there remain a number of legal hurdles to be overcome before the RAA is formally concluded and enters into force.

The signing of in-principle — but incomplete — agreements has become something of the norm in recent decades. Leaders often announce the conclusion of negotiations with a signing ceremony which only outlines the key elements that have been agreed upon. Morrison’s delayed Tokyo visit due to Australia’s 2019–2020 extended bushfire season and the ensuing COVID-19 crisis could explain this.

The symbolism of Tokyo’s joint prime ministerial signing ceremony was significant but it is not clear what was achieved other than the political commitment to finalise the RAA at some point next year. Without a draft text having been released it is not possible to comment on all aspects of the RAA. But two substantive observations can be made.

First, the RAA is considered to be a ‘landmark defence treaty that will further deepen the countries’ strategic and security relationship’. According to the Australian and Japanese governments, the RAA will ‘facilitate greater and more complex practical engagement … and enhance inter-operability and cooperation’ between the Australian and Japanese militaries. The governments noted that it ‘will also support our joint involvement in broader multilateral exercises’ and will establish ‘streamlined arrangements to support the deployment of defence forces more quickly’.

Although the RAA is not a defence pact, it will encompass elements of what is commonly known as a Status of Forces Agreement (SOFA). These …continue reading

    

Online financial transactions in Japan

Do you feel financial transactions on the internet are unsafe? graph of japanese statistics

This survey from MMD Labo looked at many aspects of online financial transactions in Japan. Note that the topic is banking and investment-related transactions, not ordinary online shopping.

I don’t do any financial transactions online because, as is tradition in Japan, I leave all the money stuff to my wife.

In Q4, I am very surprised by the result that over half use QR or bar code-based payment methods, yet less than a third use IC Card contactless, given that almost every phone sold in Japan is contactless-ready (mind you, they are also QR Core-ready) and my experience with trains is that the vast majority are using some form of contactless payment, although I suppose since I travel mostly on commuter lines in the big city I have certain observer bias.

Research results

Q1: Have you used an internet bank or internet banking? (Sample size=4,400)

Currently using Used to use Investigating using Not used
All 61.6% 7.7% 4.2% 26.5%
10 to 29 years old
N=829
43.4% 9.4% 7.7% 39.4%
30 to 39 years old
N=785
58.1% 8.4% 4.8% 28.7%
40 to 49 years old
N=1,014
67.6% 7.8% 3.9% 20.7%
50 to 59 years old
N=892
69.1% 5.5% 2.6% 22.9%
60 to 69 years old
N=880
67.4% 7.5% 2.4% 22.7%

Q2: Which is the main internet bank or internet banking that you have used? (Sample size=324)

Rakuten Bank 30.9%
Yucho (post office) Bank 9.6%
Mizuho Bank 7.7%
Sumitomo SBI Net Bank 7.4%
Mitsubishi UFJ Bank 7.4%
Regional bank 7.4%
Japan Net Bank 5.6%
Mitsui Sumitomo (SMBC) Bank 4.9%
Sony Bank 3.4%
au Jibun Bank 3.4%
Aeon Bank 3.1%
Shinsei Bank 2.5%
Seven Bank 1.2%
Risona Bank 1.2%
Shinkin (credit association) Bank 1.2%

Q3: What is important then choosing an internet bank or internet banking? (Sample size=317, multiple answer)

Cheap, free transaction fees 62.1%
24-hour usage 40.7%
Simple processes 38.8%
Trustworthy security 38.2%
Can use app 25.2%
Location of ATMs 24.0%
High interest rates 21.5%
Ease of use of transaction tools 18.9%
Full lineup of service, transaction products 16.1%
Reduces fiddly data entry 15.5%
Other 1.3%

Q4: Do you use cashless payment service, and have you linked these services to your bank account? (Sample size=4,400)

Q4A: QR code, bar code-based

Using, and linked 29.1%
Using, not linked 23.1%
Used, linked 2.4%
Used, not linked 2.8%
Not used 42.7%

Q4B: Smartphone contactless-based

Using, and linked 12.8%
Using, not linked 19.4%
Used, linked 2.4%

…continue reading

    

A second LOOK at land prices since the pandemic

The Ministry of Land, Infrastructure, Transport, and Tourism (MLIT) published their quarterly LOOK Report on November 19. With a survey point of July 1, this is the second report covering changes in land prices since the coronavirus pandemic took hold.

According to the 3rd quarter report, land prices decreased in 45% of the locations surveyed, while only 1% of locations saw an increase. In the 2nd quarter report, 30% of locations saw a drop in land prices.

In the Tokyo area, 79.1% of locations saw land prices remain flat, while 21% saw a decrease. In the previous quarter 88.4% of locations saw no change in land prices while 11.7% saw a decrease.

The situation is bleak in Osaka with 72% of locations seeing land prices decrease. The remaining 28% of locations saw no change in property values. It was a similar story in Nagoya with 100% of locations reporting a drop in land values, a third of those seeing values drop 3 ~ 6% this quarter.

Residential vs. Commercial

Nationwide, 81.3% of the surveyed residential sites saw no change in land values while 18.8% reported a decrease. For commercial sites, 41.2% reported no change and 57.4% reported a decrease.

Sapporo a winner

The only location to see an increase in land prices was the commercial area in front of Sapporo Station in Hokkaido. This may be a short-lived victory as Sapporo struggles with a very recent resurgence in coronavirus cases. As of July, however, the area was benefitting from office demand from IT, callcenter and staffing companies. The national government’s controversial Go To Campaign introduced in July was leading to an anticipated recovery in the city’s tourism industry as people took advantage of the subsidized travel discounts on offer.

Tokyo

The districts in Tokyo to see a fall in land prices were the commercial zones …continue reading

    

The danger of weaponising trade for the environment

View of high-voltage power lines at a converter station in Taizhou city, Jiangsu province, China, 18 September 2017 (Photo: Reuters).

Author: Ken Heydon, LSE

Pressure around the world is growing to apply penalty tariffs on imports from perceived environmental free riders. But such policies are a threat to trade and are unlikely to help the environment. Fortunately, there are better policy alternatives to deal with trade and environment linkages, including tackling fossil fuel subsidies.

Prominent economists such as William Nordhaus and Thomas Piketty are advocating the imposition of carbon border taxes on imports from polluting countries. These calls are founded on the fear that levies on carbon-intensive production simply push production to countries where it is not taxed. Those imposing such border taxes might also claim legitimacy under General Agreement on Tariffs and Trade (GATT) Article XX which allows measures necessary to protect human, animal or plant life.

There is however no evidence of growth of widespread pollution havens. The International Energy Agency reports that by 2019 global energy-related carbon dioxide (CO2) emissions had flattened, with strong renewables growth in China and India. China, Japan and South Korea have each recently set target dates for zero net carbon emissions.

Trade sanctions carry the risk of protectionist capture and of being a brake on the very economic development needed to fund the transition to cleaner energy and, now, to tackle the economic disruption from COVID-19 and the associated acceleration of digitisation.

Carbon border adjustments — tax levied on imports from countries without carbon pricing mechanisms — are becoming an integral part of EU trade policy, and US president-elect Joe Biden has also expressed support for them.

These sanctions may take the form of unilateral action by Europe and the United States or be applied through EU and US preferential trade agreements (PTAs) in the Asia Pacific and elsewhere. The EU–Japan agreement, …continue reading