(1) Succes of 'Abenomics' hinges on immigration policy: 5/19
In March, Hidenori Sakanaka, a former director of the Tokyo Regional Immigration Bureau, was contacted by — and met with — a group of people he had never dreamed of crossing paths with: asset managers from global investment firms.
Sakanaka, who now heads the Japan Immigration Policy Institute in Tokyo, was asked to explain Japan’s notoriously tight immigration policies and his proposal to drastically ease them to save Japan from the severe consequences of its rapidly aging and shrinking population.
Sakanaka said the asset managers showed strong interest in a remark made the previous month by Prime Minister Shinzo Abe, and that they were wondering if they should buy Japanese assets, such as stocks and real estate.
In February, Abe indicated he is considering easing Japan’s immigration policies to accept more migrant workers to drive long-term economic growth.
The asset managers reportedly included representatives from investment giants BlackRock Inc. and Capital Group.
“Global investors have a consistent policy of not investing in a country with a shrinking working and consumer population,” Sakanaka told The Japan Times.
“If the working population keeps shrinking, it will keep pushing down consumption and the country will be unable to maintain economic growth. In short, this means the growth strategies of ‘Abenomics’ can’t be successful without accepting immigrants,” Sakanaka said.
Abe is set to revamp in June the elusive “third arrow” of his economic program — structural reforms and subsidies that could boost Japan’s potential for mid- to long-term growth.
Whether drastic deregulation of immigration is part of the third arrow is something that both the public and the foreign investment firms want to know.
Japan’s population will dramatically shrink over the next five decades, from 117.52 million in 2012 to 87 million in 2060 — if the fertility rate doesn’t climb. The rate is expected to hover at 1.39 this year before dipping to 1.33 through 2024 and edging up to 1.35 for the foreseeable future.
Gross domestic product is expected to shrink accordingly, which could reduce the world’s third-largest economy to a minor player both economically and politically, many fear.
“Whether to accept (more) immigrants or not is an issue relevant to the future of our country and the overall life of the people. I understand that (the government) should study it from various angles after undergoing national-level discussions,” Abe told the Lower House Budget Committee on Feb. 13.
On May 12, members of a special government advisory panel on deregulation proposed creating six special regions where visa regulations would be eased to attract more foreign professionals and domestic helpers and baby sitters to assist them.
The daily Nikkei reported the government is likely to insert visa deregulation for certain types of foreigners in the Abenomics revamp due in June, but how many he is willing to let in remains unclear.
The conservative politician has so far appeared reluctant to promote heavy immigration and risk transforming Japan’s stable but rather rigid and exclusive society.
Abe has argued Japan should give more foreigners three- to five-year visas rather than let a massive number of immigrants permanently settle in Japan.
“What are immigrants? The U.S. is a country of immigrants who came from all around the world and formed the (United States). Many people have come to the country and become part of it. We won’t adopt a policy like that,” Abe said on a TV program aired April 20.
“On the other hand, it is definitely true that Japan’s population will keep shrinking and Japan will see a labor shortage in various production fields,” Abe said, adding he will consider easing regulations on issuing three- to five-year visas.
“It’s not an immigrant policy. We’d like them to work and raise incomes for a limited period of time, and then return home,” Abe said.
Among the core supporters of LDP lawmakers, including Abe himself, are nationalistic voters opposed to welcoming large numbers of unskilled foreign laborers, who are now barred from Japan. They fear that bringing in such people would increase the crime rate and deprive Japanese of job opportunities in the still-sluggish economy. This concern seems to be shared by a majority of Japanese. According to a poll by the daily Yomiuri Shimbun in April, while 74 percent of the 1,512 polled said they believe population decline will hurt Japan’s economy and contribute to its decline, 54 percent said they opposed bringing in more foreigners versus 37 percent who backed the idea.
Two high-ranking officials close to Abe, speaking on condition of anonymity, have said they are aware that foreign investors are interested in potential changes in Japanese immigration policy.
But their main interest appears to be to keep foreign investors interested in Japan, and trading on the Tokyo Stock Exchange, rather than transform Japan into a multicultural society by accepting more immigrants.
One of the two officials has repeatedly suggested he is paying close attention to foreign investors, pointing out that it is they, not Japanese investors, who have been pushing up stock prices since Abe took office in December 2012.
“We won’t call it an immigration policy, but I think we should accept more foreign workers,” the official said in February.
Hiking immigration is a sensitive issue for the conservative Liberal Democratic Party, the official said. But the idea of using them to fill shortages in medical, nursing, child care, for example, would be more palatable to such politicians, the official added.
Abe’s call for more short- to midterm migrant workers might help the short-handed construction, medical and nursing industries, among others. But it is unlikely to solve Japan’s long-term population crisis.
Junichi Goto, professor of economics at Keio University and an expert on immigration issues, said few people are opposed to bringing in more foreign professionals to reinvigorate the economy and that deregulation is urgently needed.
When it comes to unskilled workers, however, Goto is opposed to flooding Japan with cheap labor and says that a national consensus on the issue hasn’t been formed yet.
According to Goto’s studies and simulations, bringing in low-wage, unskilled foreigners would benefit consumers by pushing down domestic labor costs and thus prices for goods and services, thereby boosting consumption. On the other hand, he says the cost of domestic education, medical and other public services would rise.
The benefits of bringing in foreigners will far outweigh the demerits, unless Japan ships them in by the millions, Goto’s study says.
“If the Japanese people wish to accept millions of foreign workers, that would be OK. But I don’t think they are ready for such a big social change yet,” Goto said.
Instead, Goto argued that Japan should first encourage more women and elderly to work to offset the predicted shrinkage. It should then ease regulations to lure foreign professionals rather than unskilled laborers, and reform the rigid seniority-based wage system to make it easier for midcareer foreigners to enter the labor market, Goto said.
At any rate, the rapid demographic changes now hitting Japan are unlikely to leave much time for the people to make a decision.
The proportion of seniors 65 or older will surge from 24 percent to as much as 39.9 percent in 2060, raising the burden on younger generations to support social security.
The Japan Policy Council, a study group of intellectuals from various fields, estimates that in 2040, 896 of Japan’s municipalities, or virtually half, will see the number of women in their 20s and 30s decline by more than half from 2010 as they flock to big cities.
Such municipalities “could eventually vanish” even if the birthrate recovers, the group warned in a report May 8.
Sakanaka praised Abe’s February remarks, saying it is a significant change from Japan’s long-standing reluctance to accept foreign workers.
But if Abe decides to open Japan only to short-term migrants, rather than permanent immigrants, Abenomics will end in failure, Sakanaka warned.
(2) More foreigners working in Japan : 2/16
More foreigners are working in Japan than ever before, according to the Health, Labor and Welfare Ministry. At the end of October 2013, the number of foreign workers in Japan stood at 717,504, up 5.1 percent from the year before. The number was the highest since employers started regularly submitting reports on foreign employees to the ministry in 2007.
Politicians of many different stripes will surely seek to exploit this new data for rhetorical purposes, but the increase results from many complex and interwoven factors.
First, the increase stemmed from a slight improvement in employment, though there was not a great change in all areas and surely not for all workers.
The increase also reveals that Japanese workplaces are internationalizing just as workplaces worldwide are doing. In fact, Japan is far behind most other advanced countries in the percentage of workers who come from other countries.
The foreign percentage of Japan’s labor force stands at about 1 percent, compared with 36 percent in Singapore. Britain has 4.26 million foreign-born workers.
The ministry also noted that more Japanese firms want to hire foreign workers with special skills, especially as companies begin business operations in other Asian countries. There is also a need to hire foreigners who are willing to take jobs that Japanese tend to avoid. The recent hiring of more Indonesian and Filipino nurses and care workers is just one example of internationalizing trends.
Many workplaces are now starting to accept diversity, changing past expectations of homogeneity.
Many other businesses simply need more employees. Some 40 percent of construction companies have reported not having enough workers, an important point considering that Japan will need a lot of construction work for the 2020 Tokyo Olympics. However, with more foreigners entering more workplaces in Japan, the possibility of worsening employment conditions needs to be considered and regulations put in place to ensure workers are treated fairly.
At the same time, hiring more foreign workers means that anti-foreign sentiment may increase as a result of some people assuming, wrongly, that hiring more foreign workers means taking jobs from Japanese.
To reduce such frictions, the government and businesses need to create stable, regular employment for all workers. It is not the presence of foreign workers that destabilizes working conditions, but rather employers who exploit cheap labor.
The government needs to prevent such employers from offering positions to those willing to work for the lowest pay.
Both the government and the business sector also need to ensure that all employees receive fair and equal treatment.
Integrating foreign workers into Japanese workplaces, while ensuring that working conditions improve for Japanese workers — especially women — is not an easy task, but it is one that the government should address directly, seriously and urgently.
(3) Boosting the female workforce ： 5/19
The Abe administration is pushing for a review of the tax and social security benefits for households with full-time housewives or low-income housewives, on the grounds that such rules serve as disincentives against women’s greater participation in the labor force even as the nation faces a steep decline in its working-age population.
In making the review, the government also needs to look at other hurdles that discourage women with children from spending more working outside the house. Otherwise, it could end up merely adding to the burden on households by abolishing or scaling down the benefits.
Salaried workers can have their taxable income reduced by ¥380,000 if their spouses earn less than ¥1.03 million a year. If the spouses earn between ¥1.03 million and ¥1.41 million, the main bread earners can still deduct an amount lower than ¥380,000 from their taxable income. Separately, if the spouses earn less than ¥1.3 million a year, they can be exempt from pension premium payments and be covered by the main bread earners’ corporate pension schemes.
Many of housewives who work part-time jobs are believed to adjust their work hours and keep their annual income from surpassing these thresholds to retain the status advantageous in tax and pension premiums.
(4) 'Abenomics' fueling rise in working poor : 5/19
(Reuters) - Last Christmas Eve, Ririko Saito and her 11-year-old daughter gathered some plastic bottles, pots and a kettle and made several trips to a nearby park to get water. Their utility had just turned off the tap after months of unpaid bills.
"I was going to take care of it as soon as I got my paycheck in a few days," the 49-year-old single mother said. "I figured they wouldn’t be so callous to cut us off at that time of year. I figured wrong."
Saito, who works part-time caring for the elderly in a Tokyo hospital and gets welfare to supplement her salary, represents a growing army of poor in a nation that continues to pride itself on being an egalitarian society despite a decades-long rise in poverty.
At 16 percent, Japan’s relative poverty rate – the share of the population living on less than half of the national median income – is already the sixth-worst among the 34 OECD countries, just ahead of the United States. Child poverty in working, single-parent households like Saito’s is by far the worst at over 50 percent, making Japan the only country where having a job does not reduce the poverty rate for that group.
As Prime Minister Shinzo Abe charges ahead with his ・・・
(5) Expert urge BOJ to draft exit strategy : 4/13
WASHINGTON – Despite lingering market pressure on the Bank of Japan to take further easing steps, its Group of 20 counterparts might not welcome the central bank’s next move.
With concern mounting about how the BOJ’s unprecedented purchases of government bonds and risky assets will impact global markets, the G-20 finance chiefs might pressure the BOJ in the near future to clarify how it will phase out the deflation-busting measures.
The G-20 finance ministers and central bank governors — who are struggling to prevent the Russia-Ukraine crisis from hurting the world economy — wrapped up their two-day meeting Friday in Washington by emphasizing in a communique that they will “continue to provide clear and timely communication” of their monetary policy actions.
In this context, some experts have expressed caution that the BOJ may draw international criticism if it takes additional credit easing measures that could have strong side effects without preparing an exit strategy.
As the U.S. Federal Reserve has been asked by emerging economies at the G-20 gathering to communicate with the financial markets about how fast it will taper its own giant monetary stimulus program, the BOJ could soon find itself in the same situation.
Many observers say the BOJ is likely to take action early this year to achieve its 2 percent inflation target because the economy is widely expected to stall following the April 1 consumption tax hike — Japan’s first in 17 years.
On Tuesday, after the BOJ decided to leave its aggressive monetary easing policy in place, ・・・
(6) Protecting the water cycle : 5/19
The Diet has enacted a basic law on the water cycle, which is set to take effect by July. The legislation, submitted by a supra-partisan group of lawmakers, aims to maintain and restore the water cycle — the constant movement of water above, on and below the surface of the earth in the form of vapor, rain or snowfall, rivers, lakes, aquifers and oceans — in this country.
Disruption to this cycle could result in water shortages or declines in water quality. Water shortage is already a serious issue in many other countries. On the strength of the basic law, the government needs to adopt concrete measures so that Japan can continue to secure a sufficient amount of clean water, which is indispensable in ensuring a healthy life for people and a vigorous pursuit of economic activities.
At present the administration of water is segmented among different government organizations. Rivers and sewerage systems are under the jurisdiction of the land and infrastructure ministry; headwater areas in mountains under the Forestry Agency; agricultural water under the farm ministry; city tap water under the health and welfare ministry; and water for industrial use under the trade and industry ministry. This reflects the lack of a system for protecting the nation’s water resources from the viewpoint of the water cycle.
The basic law calls for setting up a policy headquarters on water-related issues at the Cabinet level, which will be tasked to write a basic plan to keep the natural movement of water in smooth conditions. Policy coordination among the government bodies concerned is needed to work out a comprehensive policy to achieve the law’s goal.
In recent years, Japan has seen increasing purchases of forest land in headwater areas by foreign capital — in particular Chinese capital. This has raised alarms over the preservation of the nation’s water resources, with concerns growing among local governments in those areas that public use of underground water beneath the purchased land could be blocked.
(7) Japan's nuclear waste problem : 1/22
The government plans to step up its efforts to select the final disposal site for high-level radioactive waste from nuclear power generation, after having failed to find any willing host community for more than a decade. But the long-stalled process will have little prospect of moving forward unless doubts and questions surrounding nuclear power — including those highlighted by the 2011 Fukushima nuclear disaster — are answered.
(8) Suspect flip-flops on email threats : 5/21
A computer expert on trial for sending violent threats from other people’s hacked computers has admitted he’s guilty, calling himself “a psychopath” in a surprise confession, his lawyer said Tuesday, potentially ending a case that had earlier seen police arrest the wrong suspects.