The Indians are, of course, salivating at the prospect of having overtaken Japan, as always with a song and dance, but let us be honest. Japan falling to fifth from world's second biggest economy is a big drop and would probably fall further.
Japan has huge problems regarding its economy, which is still stagnant after more than 30 years fighting a losing battle. Japan's massive debt to GDP ratio of 236% is one big problem to overcome with interest rate rising. The spat with China is detrimental to Japan, with China putting its slow-motion squeezing by inflicting long-term pain for Japan. Tourists from China are not visiting Japan and is causing serious problems for the Japanese tourism sector. China's ban on Japanese seafood, lifted not long ago after wastewater discharge from Fukushima, is back in full force and Japan's seafood industry is suffering. Most of all, the sanctions put on the export of critical rare earth elements by China is causing Japan's manufacturing serious issues.
Japan is meanwhile losing its last economic bastion in Motor Vehicles. Japan betted on hydrogen fuel cell vehicles and lost the bet to Chinese EVs. The road ahead for Japanese car makers is difficult by being late to the EV party. Even Tesla, in the forefront of EVs before the Chinese, is facing severe headwinds from the Chinese.
Japan was probably too hesitant to change in many fields and could not catch up by being late. We are seeing the same picture with AI, with Japan now trying to enter the game when the others are already far ahead.
Anonymous
3 comments:
Never underestimate the Jap. They can rise after ww2 & become the top innovation country of the world is no accident. They can even defeat most of the country in south east asia during the war and also rule part of China/Korea/Taiwan for many years. On the surface they may appear nice/weak, but it is in their gene that they believe they are better than the rest of the human bean. Give them a chance, they will produce nuclear bomb in no time..then the world kpkb also no use.
How to rise when it is under USA control and that control has crippled Japan for decades and now saddled it with so much debt. More than 30 years after the asset bubble burst in 1992 in Japan, it is still unable to dig itself out of the hole. So much stimulation over the years, so many arrows fired in all direction, so much cheap money to stimulate its economy and yet it all came to naught. What happened to the much-touted Japanese innovative spirit that made it great after WW2? They lost the blueprint I suppose.
If rising is so easy as what Marco Rubio thought, those fallen empires like Spain, Portugal, Dutch (now Netherlands) and UK would have done it.
Post a Comment