By: Kazuaki Kubo, Consul General of Japan Issue: Global Trade Section: Collaborator Profile
Experience and Expertise in Energy-Saving Technologies
It has been said that Japan is a nation that lives by trade. With limited natural resources and a large population, over 120 million people in a country roughly the size of California, it is not realistically possible for Japan to hope for a self sufficient economy. Even the rate of self-sufficiency in food production is less than 40% in Japan.
Following World War II, Japan developed and expanded its economy by importing raw materials and resources and then exporting value-added manufactured products. This basic model continues today, and trade with foreign countries and the free-trade systems that support it are crucial for Japan’s economy and its security in general. trade with foreign countries and the free-trade systems that support it are crucial for Japan’s economy and its security in general.
The currently depressed world economy, originating from the so-called sub-prime loan and credit problems in the United States last year, has resulted in a worldwide trade slowdown which has seriously impacted the overall Japanese economy. Exports from Japan that had been increasing through September of 2008 suddenly decreased by 7.8% in October of 2008, compared with the same month from the prior year. Since then, the decline in exports has continued and steepened, showing a record decrease of 49.4% in February of 2009, compared with February 2008. This environment casts a very long shadow on a Japanese economy led by exports, exacerbated by a prolonged exchange rate tendency toward a weak dollar and stronger yen.
Under these conditions, Japan is reaching for new directions. One part of a solution is to reduce excessive dependence on the American market by diversifying into other overseas markets, especially in newly developing areas such as Asia. In relation to this, on May 21, Japanese Prime Minister Aso outlined a plan to help double the GDP of countries in Asia by 2020. The goal is to achieve mid and long-term growth in the Asian region, by helping to stimulate the expansion of domestic demand in each country with financial support from Japan totaling about $67 billion in aid to the region.
Issue 5 Japan pic005 Another route for Japan is to utilize its experience and expertise in energy-saving technologies. With recent increases in world population and economic growth in many newly-developing countries, effective use of limited resources and the reduction of negative environmental impact have become a near universal preoccupation. During the era of rapid economic growth, Japan cultivated technologies and “green” engineering to address its global struggle against environmental pollution and during the oil shock of the 1970’s.
As a result, Japan ranks high in comparisons of energy consumption rates in relation to GDP. For instance, if the consumption of primary energy for each unit of GDP in Japan is assumed to be 1, the rate of consumption in the EU is 1.9, the United States is 2, China is 8.7, and India is 9.1, according to statistics from 2004.
Further, the Japanese auto industry is in a leading position in the development of eco-friendly vehicles such as hybrid gas and electric-powered cars.
Contributing to worldwide energy-conservation and reductions in environmental impact, through the transfer of such technology and experience to other countries, would help serve to stabilize the global community both politically and economically. This would likely be more beneficial for Japan than immediate profits from simply exporting such technologies. Therefore, the Japanese Government works in close cooperation with the Japanese private sector toward realizing the transfer of its energy-saving technology and green engineering knowledge outside Japan.
Japan also participated strongly in the formation of the “Kyoto Protocol” concerning the reduction of worldwide greenhouse gas emissions, and has created the “Cool Earth Partnership” by contributing a total of $10 billion to proactively help increase the implementation of measures against global warming in developing countries.
Lastly, for the international society to deal with such global issues effectively, the maintenance of world peace and stability is essential. From this standpoint, Japan will continue its longstanding diplomatic posture based on pacifism.
Contact the Consulate-General of Japan at Denver at 1225 17th Street, Suite 3000, Denver, CO 80202 or at 303-534-1151.