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Commentary: Time for Japan to change its “exclusively defense-oriented” trade policy

  • May 5, 2019
  • , Mainichi , p. 2
  • JMH Translation

By Kazuo Ogura, specially invited professor at Aoyama Gakuin University

 

Since World War II, Japan has maintained an exclusively defense-oriented policy in the area of security. Strictly speaking, there is a question about how to view its participation in U.S. acts of “aggression” during the Vietnam and Iraq Wars because it was cooperating with the U.S. military although the assistance took the form of providing bases. I will set that issue aside here.

 

Japan’s economic and trade policy in relation to foreign countries has also tended to almost always be “exclusively defense-oriented.” This has meant that Japan’s stance in economic and trade negotiations has basically been to consent to the other side’s demands and “respond” to them.

 

From the 1950s through the early 1960s, Japan was labeled as a nation that engages in “export dumping” and “triggers market confusion.” Japan responded by allowing other nations to take special safeguards and by implementing its own measures such as voluntary export restrictions. Japan almost never put strong pressure on the counterpart nation regarding the need for that nation to make industrial adjustments and the policies required to do that.

 

Reviewing the history of Japan’s trade negotiations with the United States reveals that Japan made compromises but its actual actions did not fully meet the U.S. demands. Japanese “measures” that it “voluntarily” took included export restrictions on textiles, ceramics, and metal flatware in the 1950s, export restrictions on steel, televisions, automobiles, and semiconductors in and after the 1960s, as well as investment in the United States thereafter.

 

In the area of agricultural products as well, the United States and Europe, which are major exporters to Japan, pressed Japan to follow the “principle of free trade” even while they took substantial measures to support their own domestic agriculture industry and subsidize their exports. Despite this, it was unusual for Japan to strongly denounce these countries’ contradictory actions. Japan had all it could do to request that these countries not restrict their supply to Japan of agricultural products at their own convenience. Japan’s repeated attack against U.S. import restrictions on Satsuma tangerines was an exception where Japan “took the offensive.”

 

Similarly, the main causes of America’s trade deficit with Japan lay in U.S. economic measures and consumer spending habits. Macroeconomic factors were often a main cause, but there were comparatively few cases where Japan pushed this point strongly.

 

What lay behind this “exclusively defense-oriented” policy were the practice since World War II of labeling Japan as “the bad one” and the logic of defeat in war. A hidden psychological mechanism was at work where Japan believed that “reforming itself by harnessing its defeat and sense of remorse was the way for it to make it in the international community.” Moreover, there likely was the economic “calculation” that compromise would bring more practical benefits than would the path of causing diplomatic and political friction by insisting on its position.  

 

Later when Japan was recognized as an economic superpower and became a member of the G-7, Japan contributed to the economic development of poor nations through so-called economic cooperation and took policies to promote the development of democratic societies. Japan’s seemingly “exclusively defensive economic policy” thus took on the quality of being a slightly proactive “policy of contributing” to other nations. Japan’s economic cooperation policy, however, inevitably contained a large element of “compensating” nations it had harmed or colonized during the war, and the support Japan offered was always in line with the recipient nation’s “requests.” It was rare for Japan to think strategically before embarking on economic assistance. This also reveals an “exclusively defense-oriented” philosophy.

 

This “exclusively defense-oriented” philosophy had a certain significance for Japan and the entire international community when the international community overall sought internationalism and consensus (for example, Japan’s internationalization and contribution to security in the international community).

 

Today, however, the United States is strongly leaning toward protectionism and unilateralism, and Europe is losing its will to integrate. China and India have some reservations about the current international order and are insisting that developing nations be given status, but they are not in a position to bear a major responsibility in building the global economic order of the future.

 

Under these circumstances, is it okay for Japan to continue to maintain an exclusively defense-oriented policy?

 

From that perspective, Japan’s formation of an economic partnership agreement (EPA) with the European Union (EU) and its promotion of the ratification of the Trans-Pacific Partnership (TPP) trade pact are timely.

 

In addition, Japan should strengthen its comprehensive economic partnership with China; promote the formation of an economic zone along the Sea of Japan that would include North Korea, Mongolia, and the Russian Far East; and strengthen and expand international cooperation institutes and funds to resolve world issues, including environmental protection, poverty eradication, disaster countermeasures, and international infectious disease countermeasures. Is it not necessary for Japan to change its basic stance, including how it conducts negotiations with the United States?

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