Japan Must Urgently Adopt New Economic Model
Posted by msrb on February 26, 2009
Japan’s Survival Now Depends on a Low Energy, Intelligent Socioeconomic Model
Japan’s economy, the world’s 2nd and Asia’s largest, is rapidly becoming the biggest victim of the global recession. As the world’s recession woes deepen, demand for Japanese exports like cars and high-tech goods falls. Japan’s economic and therefore national survival depends on its exports.
Workers and trade union members hold placards which read “Don’t Cut” jobs during a rally in Tokyo. Photo: AFP. Image may be subject to copyright.
“Because of the shrinking global economy, Japan’s business model of being dependent on exports is not working at all,” said Barclays Capital Japan chief economist Kyohei Morita.
Japan’s economy is rapidly shrinking, WSJ said, “with government data showing that gross domestic product plunged by an annualized 12.7% in October-December, its fastest contraction since the 1974 oil shock.”
“With the export sector extremely weak and the domestic economy weakening, there is a growing risk that you could get a significant rise in Japanese unemployment,” said Christopher Wood, an equity strategist at the CLSA bank.
Japan’s trade deficit rose by a factor of 10 in January, to about 953 billion yen from a 90 billion yen deficit a year earlier, the Ministry of Finance said Wednesday, clocking up the country’s largest trade deficit ever. Overall exports during the period plunged by a record 45.7% year-to-year to 3.483 trillion yen.
As the global economy heads further into a depression, the outlook of a near- to mid-term recovery for Japaese exports is gleam.
Japan’s energy self-sufficiency is less than 4 percent of the country’s consumption. As for the food security, Japan’s food self-sufficiency rate, the total calories supplied, fell from 40 to 39 percents in fiscal 2006, one of the lowest rates in the ‘developed’ world!
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