Japan and World Economy

Week 5

Japan and World Economy

 

Hello! I maybe have a cold now. I feel so tired but do our best this time too. This time I introduce you Japan’s trade with many other country. Particularly, this time, I introduce you trade between Japan and America. At first, I tell you surprising information. Economy of Japan and America occupy about 30% of world economic activities. So cooperating between Japan and America closely and develop their economy together is necessary for not only the two countries but also other countries of the world to develop sustainably. Are you surprised? Of course, I was surprised when I know this at first. But there are some problems between the two countries. This time, I will introduce you one of Japan-U.S. problems “Trade friction”. What is trade friction? Trade friction is the problem that arise from extreme deflection of relation of import and export. It is believe that disproportion of economic income and expenditure affect domestic economy badly.

 After world war 2, the higher international competitiveness of Japanese economy the more things are exported from Japan to America. Japanese exportation is so many that it damage American industry. So the issue of trade became political problem and was called “Japan-U.S. trade friction”. This is the beginning.Thereafter, there are things which was dealt as “Japan-U.S. trade friction” (In 1950’s is textiles, 1960’s is steel product, 1970’s are color TV, car and industry of high-technology, 1980’s are semiconductors and VTR .) and some agreements are made. One of agreements regulate Japanese exportation.

 International trade is zero-sum game like mahjong. This means that one country get profit, another country go into the red.  For example, in America 2006, The sum of exportation from Japan was about 17 trillion yen, that of importation from Japan was about 8 trillion yen. So the sum of trade surplus from Japan was about 9 trillion yen. In 2006, the sum of American trade deficit was about 90 trillion yen, so that of exportation from Japan occupy about 10% of American trade deficit.

 Of course Japan has corresponded this problem to make the bad situation better. I write above, Japan regulate exportation. In 1985, strong yen was instructed to decrease the amount of exportation from Japan. And Japan produce and sell car in earnest in America because the sum of Japanese exportation doesn’t increase in trade statistics, in1993 local production number became higher than export number. (400)

 Why has this problem been unsolved yet? This is because the saving rate of Japanese people is high. This is characteristic of Japanese and also this means that the rate of Japanese consumption is low so this causes increase of exportation. But I think there is big cause. Japan have depended on America to security of own country. (in Japanese “安全保障”) So Japan cannot say what Japan want say really to America and America have insisted that Japan have made the cause of trade deficit.