Friday, August 29, 2014

Asia-Pacific Economic Integration: Japan Looking beyond TPP

Abe planting rice, Fukushima May 2014

Boston University Professor and APP member William W. Grimes wrote this essay for CSIS.

August 27, 2014
A little over a year ago, on July 23, 2013, Japan formally joined the negotiations to create the Trans-Pacific Partnership (TPP), one of the most ambitious trade negotiations ever. After a number of years of domestic debate and attempts by two previous prime ministers to persuade their coalitions to support it, the new Shinzo Abe administration had resolutely chosen a path toward all-out liberalization of trade and investment that could transform the Japanese economy. TPP had the potential to promote both Asia-Pacific economic integration and domestic reform. Today, however, the TPP process is in limbo and Japan’s commitment to comprehensive liberalization is in question. What does this mean for Japan’s economy going forward?

Japan in the Asia-Pacific Economy
Despite the old shibboleth that Japan’s economic miracle was due to “export-led growth,” Japan has in fact been a rather closed economy by many measures.1 This pattern began to change in the late 1980s, after the rapid appreciation of the yen that began with the 1985 Plaza Agreement. Japanese firms began to source more of their intermediate goods and components from other Asian economies; over time, these practices contributed to the development of extensive regional production networks (RPNs) for the manufacture of consumer electronics, information technology hardware, and (to a lesser extent) automobiles. RPNs allowed for a regional division of labor based on comparative advantage, creating opportunities for developing and middle-income countries up and down the supply chain.

Today, RPNs drive the bulk of East Asian intra-regional trade, with final production being exported globally. This is not simply about regional sourcing, as Japanese foreign direct investment and services trade have generally followed goods trade. Japanese banks, trading companies, and shipping companies have also built regional and global operations that support the needs and activities of manufacturers. To be sure, Japan and Japanese firms are no longer at the center of the regional economy; moreover, RPNs have contributed to the deindustrialization of Japan, creating considerable angst. Nevertheless, it is evident that Japan’s economic future lies in further integration into a regional Asia-Pacific economy.

Further integration of Japan into the regional economy will be the result of private-sector decisions and actions, as firms and banks make decisions about how best to serve existing markets and prioritize new ones. Still, government policies are important in shaping incentives.

TPP in Theory and Practice
The concept of the TPP is to create a high-quality, “21st century” trade agreement that will be comprehensive in scope and promote deep integration among its members. It goes beyond existing regional trade agreements by reaching inside borders to address nearly every type of policy that has cross-border implications. The proposed reach of TPP includes rules that govern trade in goods and services, investment, competition policy, government procurement, e-commerce, agricultural policy, financial regulation, intellectual property rights, the activities of state-owned enterprises, labor, and environment. At least some of these disciplines would be enforced through an investor-state dispute resolution mechanism that would allow foreign investors to challenge domestic laws, further reducing the policymaking discretion of member states.

Thus, TPP is more than just a trade agreement. If the maximalist positions in each of its disciplines are adopted, it would have a transformative effect on the economies of many of the participating states, including Japan. For Japan, TPP addresses a number of Prime Minister Abe’s “third arrow” priorities, while also providing a backdoor means to a U.S.-Japan free trade agreement (FTA), which had long been considered politically infeasible. Externally, TPP would create new opportunities for Japanese firms to enter and do business on a level playing field with locals in the 11 other TPP countries. Internally, it could provide a bludgeon with which to advance the cause of structural reform: forcing Japanese farmers to improve efficiency and cost competitiveness, increasing competition into protected sectors like health care and legal services, and eliminating preferences for partially privatized institutions like Japan Post and NTT.

Theory is not necessarily the same as reality, however. Opposition to TPP runs deep in many participating countries, not only to the “21st century” issues (i.e., the “behind-the-border” issues, e-commerce, supply chain facilitation, intellectual property rights, environment, labor, etc.) but also the “20th century” issues of trade in goods and services. Twentieth century issues are perhaps particularly important between Japan and the United States, which are by far the two largest economies participating in TPP negotiations. According to numerous news reports, U.S.-Japan bilateral negotiations (which are ongoing, even though the formal TPP negotiating rounds are multilateral) have been bogged down by Japan’s unwillingness to fully liberalize agricultural imports. U.S. popular and political opposition to TPP is also strong, especially in the Rust Belt, where fears of competition from the Japanese auto industry run deep. U.S. legislators have shown their hostility to the negotiations by not passing trade promotion authority (TPA, or “fast track”). TPA, which requires Congress to vote up or down on trade agreements without adding amendments, has been an essential tool for passage of trade agreements for decades; without it, it is hard to imagine that the United States’ TPP partners would make their best and final offers or that the negotiations will be successfully completed. While some commentators have blamed Japanese intransigence over agriculture for the apparent slow pace of TPP negotiations since late 2013, it can also be argued that the Japanese government is holding out on making politically unpopular decisions until it can be sure that a deal is imminent—which will not be the case until (or unless) Congress passes TPA. For now, there is simply not enough evidence to make a meaningful judgment about the Abe administration’s intentions.

TPP and Abenomics
The irony is that Japan stands to gain more from TPP than any other participant, at least in absolute terms.2 The reason is not primarily that Japanese firms will gain a great deal of market access in other TPP economies. Rather, the major gains are expected to result from removal of its own barriers to imports and domestic competition that have made bastions of inefficiencies out of a number of sectors from agriculture to textiles to legal and health services. According to economic logic, exposing these producers to greater competition will either make them more efficient or drive them out of business and shift resources to more competitive sectors.

To put it another way, a trade agreement with TPP countries is less important to Japan’s economic revitalization than large-scale domestic economic reform. The Abe administration shares this assessment of TPP as a domestic policy tool, and indeed several of the items in TPP mirror key elements of Abenomics’ “third arrow.” However, political resistance to such changes is significant, and there has been limited progress in advancing the structural reform agenda. The result is that the success of Abenomics structural reform has become closely linked with that of the TPP negotiations.

When Prime Minister Abe first came to power, time was on his side. He had a strong majority in the Lower House and was able to appoint accommodative new leadership at the Bank of Japan. After the 2013 Upper House election, he had strong majorities in both houses of the Diet and the prospect of three years without a national election. A year and a half into his administration, with little prospect of TPP being completed before mid-2015 at the earliest, however, the window of opportunity is closing. It appears that Abe can no longer count on TPP to be a silver bullet for structural reform.

What If TPP Continues to Languish?
This raises the question of how Japan should move forward in terms of regional economic integration as well as domestic reform. Fortunately, despite the rhetorical commitment to TPP as a central pillar of both pieces of the economic agenda, there are other options. For the domestic agenda, the Japanese government’s best bet will be to continue with ongoing reforms, although priorities may shift as TPP sits on hold. With or without TPP, serious structural reform will inevitably be a matter of political will, and victory will not be dramatic but rather the result of an accumulation of incremental changes. Certainly, success is not assured. But serious progress is possible if the Abe administration starts acting with greater urgency on the third arrow.

As for trade agreements, the regional picture does not look promising. Not only is TPP in limbo, but negotiations with other major trading partners are either in preliminary stages or stalled. This is true not only of the ASEAN-centered Regional Comprehensive Economic Partnership (RCEP), but also of the Japan-EU, Japan-Korea, and China-Japan-Korea negotiations. While all of these partnerships could have a significant impact on Japanese growth and most would tie the Japanese economy more closely to the dynamism of East Asia, none is a near-term prospect.

Fortunately, regional negotiations do not represent a complete picture of the potential importance of trade agreements. The failure of the Doha Round makes it easy to overlook the successes of multilateral and plurilateral agreements under the World Trade Organization (WTO), including in recent years. Japan can benefit from a variety of recent or upcoming agreements, including the WTO Trade Facilitation Agreement, as well as the International Technology Agreement (ITA), which has succeeded spectacularly in eliminating barriers to much of the component trade that has underlain regional and global production networks in information and communications technology hardware; the Government Procurement Agreement (GPA); the Trade in Services Agreement (TISA); and the Environmental Goods Agreement (EGA). By addressing sectoral barriers to trade among coalitions of the willing, these plurilateral agreements have the potential to move forward Japan’s economic integration with its Asia-Pacific neighbors without the endless negotiations of a TPP or RCEP and the perils of getting stuck in the “noodle bowl” of multiple nonstandardized bilateral FTAs.

Economic Policy beyond TPP
All this is qualified good news for Japan. The TPP strategy had the potential to kill multiple birds—domestic reform, regional integration, and reinforcement of the U.S.-Japan alliance—with one stone. It is not necessary for any of them, however. Given the reality that TPP will not be concluded quickly (or, perhaps, even eventually), the Japanese government would be wise to focus on a combination of domestic reform and rededication to plurilateral initiatives like the ITA, TISA, and EGA. By doing so, it can advance the goals of shaping an integrated Asia-Pacific economy in which Japanese firms are confident and robust players.

1 Japan’s trade-GDP ratio is by far the lowest of any of the major East Asian economies; among industrialized countries, only the United States ranks lower on that measure (http://data.worldbank.org/indicator/TG.VAL.TOTL.GD.ZS). Inward foreign direct investment (FDI) has also been unusually low—with a cumulative inward FDI stock of $205 billion (3.4% of GDP), it is lower in absolute terms than FDI stock in Poland and by far the lowest relative to GDP among OECD countries (at 3.4%, far behind the next lowest OECD member, South Korea, at 12.8%) (http://www.oecd.org/investment/FDI%20in%20figures.pdf).) Among indicators of economic globalization, Japan punches in its weight class only in terms of outward FDI.

2 Peter A. Petri, Michael G. Plummer, and Fan Zhai, The Trans-Pacific Partnership and Asia-Pacific Integration: A Quantitative Assessment (Washington, DC: Peterson Institute for International Economics, November 2012).

Monday, August 25, 2014

Policy in Japan: September in Washington

Prime Minister Abe campaigning
US-Japan Research Institute (USJI) holds an annual week of programs in Washington, DC on Japanese public policy featuring speakers from the Institute's associated universities in Japan.

September 3 - 9 is this year's week of presentation and discussion. 

USJI's  mission is to produce practical research results based on a sound academic base, and to strategically establish a leading-edge research base in Washington, DC from which to announce its results and contribute to the policy discussion.

USJI is an APP member and APP interns will be assisting USJI interns at the events. Please say hello!

You can find more information and locations by clicking on each seminar's title.

OPPORTUNITIES AND CHALLENGES IN THE US-JAPAN ALLIANCE. 9/3, 10:00-11:30am. Speakers: Hiroshi Nakanishi, Professor, Kyoto University; Michael J. Green, Senior Vice President for Asia and Japan Chair, CSIS.  What are the steps policymakers in Tokyo and Washington should take to further strengthen this essential relationship?

TRANSLATIONAL RESEARCH BASED ON MOLECULAR CRANIOFACIAL DEVELOPMENTAL BIOLOGY AND DEVELOPMENT OF RELATED CLINICAL ACTIVITIES IN DENTISTRY. 9/3, 1:00-2:30pm. Speakers: Harold C. Slavkin, Founding Director, USC Center for Craniofacial Molecular Biology and Professor, Ostrow School of Dentistry of USC; Yoshihide Mori, Professor and Chair, Kyushu University.  Discussion of the present conditions and problems in furthering the exchange of medical researchers between the US, Japan, and Southeast Asia. 

SOCIAL INNOVATION THROUGH RAILROAD INNOVATION: JAPAN'S EXPERIENCE AND POSSIBILITIES FOR US-JAPAN COOPERATION. 9/4, 10:00-11:30am. Speakers: Satoshi Seino, Chairman, East Japan Railway Company; Karen Hedlund, Deputy Administrator, Federal Railroad Administration.  An overview of the postwar history of Japanese railroads and how JR East's can use its experience to contribute to innovation, especially high speed rail, in the US.

IMPROVING POLICY AND PRACTICE ON RETURN MIGRATION AFTER NATURAL DISASTERS.  9/4, 3:00-4:00pm.  Speakers: Mikiyasu Nakayama, Operating Advisor , USJI / Professor, The University of Tokyo; Carl Bruch, Senior Attorney, Co-Director, International Programs, Environmental Law Institute(ELI); Nicholas S. Bryner, Visiting Associate Professor, George Washington University. Discussion of policy priorities, public perceptions, and policy options for encouraging post-disaster return migration in the United States and Japan.

POLITICS AND FINANCIAL MARKETS (Tentative). 9/5, 5:00pm.  Speaker: Nobuhiko Hibara, Associate Professor, Waseda University.

DYNAMISM OF DOMESTIC POLITICS AND REGIONAL INTEGRATION POLICY AMONG CHINA, JAPAN, AND THE US9/5, 1:00-3:00pm. Speakers: Takashi Terada, Operating Advisor, USJI and Professor, Doshisha University; Matthew P. Goodman, William E. Simon Chair in Political Economy and Senior Adviser for Asian Economics, Center for Strategic and International Studies; Min Ye, Professor, Boston University; Mireya Solis, Senior Fellow, Foreign Policy, Center for East Asia Policy Studies, Philip Knight Chair in Japan Studies, Brookings Insitution. Explores the inter-linked relationship between domestic politics and international behavior among China, Japan and the United States in Asia-Pacific helping and hindering regional integration.

WOMEN AND FOREIGN WORKERS: NEW STAKEHOLDERS OF ABENOMICS?   9/8, 10:00-11:30am.  Speakers: Keiji Nakatsuji, Operating Advisor , USJI  and Professor, Ritsumeikan University; Junya Tsutsui, Professor, Ritsumeikan University; Apichai W. Shipper, Adjunct Associate Professor, Asia Studies Program, School of Foreign Services, Georgetown University; Linda Hasunuma, Assistant Professor, Franklin and Marshall College. Discussion of the obstacles that women and immigrants confront in the Japanese workforce.

THE CHALLENGES OF JAPAN-US RELATION IN EAST ASIAN COMMUNITY: TOWARD NORTHEAST AND SOUTHEAST ASIA. 9/8, 3:00-4:30pm.  Speakers: Toru Oga, Associate Professor, Kyushu University; Yoichiro Sato, Professor, Ritsumeikan Asia Pacific University. Discussions of the security problems in Northeast  and Southeast Asia, and how U.S.-Japan relations have been able to contribute to the construction of an East Asian community.

TEACHING THE JAPANESE AMERICAN EXPERIENCE IN THE UNITED STATES AND JAPAN.  9/9, 10:00-11:30am.  Speakers: Jane H. Yamashiro, Visiting Scholar, Asian American Studies Center, University of California; Curtiss Rooks, Professor, Assistant Professor of Asian Pacific American Studies, Loyola Marymount University; Mitch Maki, Vice Provost, Academic Affairs, California State University Dominguez Hills; Yasushi Watanabe, Professor, Keio University. Examines the academic narrative of the history of Japanese American communities and how Japan can connect to them.

Sunday, August 24, 2014

Prime Minister of Japan’s Schedule July 28-August 3, 2014

Monday, July 28, 2014

AM

(Local time in Trinidad and Tobago)
Attend Japan-Caribbean Community (CARICOM) Summit Meeting at Hilton Hotel
Attend signing ceremony and joint press release with Prime Minister of Trinidad and Tobago Kamla Persad-Bissessar and others

PM
(Local time in Trinidad and Tobago)
Informal talk with all leaders of the countries involved in Japan-Caribbean Community (CARICOM) at Hilton Hotel
Depart from Piarco International Airport on private government aircraft
(Local time in Colombia)
Arrive at El Dorado International Airport in Colombia’s capital city Bogotá

Tuesday, July 29, 2014

AM

(Local time in Colombia)
Offer flowers at House of Simón Bolívar, memorial of independence movement leader
Conference with President of Colombia Juan Manuel Santos at La Moneda Palace, joint press release
Lunch meeting hosted by Mr. Santos at La Moneda Palace
Attend Japan-Colombia Economic Committee at National Federation of Coffee Growers of Colombia’s headquarters, give address
Informal talk with Japanese-Colombians at Hilton Hotel
Attend reception hosted by the Japanese government at Hilton Hotel

Wednesday, July 30, 2014

AM

(Local time in Colombia)
Depart from El Dorado International Airport in private government aircraft

PM
(Local time in Chile)
Arrive at Arturo Merino Benítez International Airport in Santiago, Chile’s capital city
Informal talk with Japanese-Chileans at Grand Hyatt Hotel in Santiago
Informal talk with authorized business personnel
Attend inaugural ceremony for Caserones Copper Mine

Thursday, July 31, 2014

AM

(Local time in Chile)
Informal talk with accompanying group of reporters at Grand Hyatt Hotel
Attend Japan-Chile Trade and Investment Forum
View Japanese garden [日本公園] on Santa Lucía Hill (Cerro Santa Lucía) in central Santiago
Offer flowers at People’s Plaza, looking out over La Moneda Palace
Summit Conference with President of Chile Michelle Bachelet Jeria at La Moneda Palace

PM
(Local time in Chile)

Joint press release with President Bachelet

Lunch meeting hosted by the President
Depart from Arturo Merino Benítez International Airport in private government aircraft
(Local time in Brazil)
Arrive at Brasília International Airport in Brazil

Friday, August 1, 2014
AM
(Local time in Brazil)
Attend a meeting to exchange views with Brazil’s economic community
Informal talk with Japanese-Brazilian National Congress members and government officials
Attend gratitude for football (soccer) gathering,
Reception ceremony for Mr. Abe at Planalto Palace (Palácio do Planalto)
Summit Conference with President of Brazil Dilma Vana Rousseff

PM
(Local time in Brazil)
Joint press release with Ms. Rousseff
Exchange of views with Japan-Brazil Wise Men Group members at Brazilian Ministry of External Relations
Lunch meeting hosted by President Rousseff
Informal talk with representatives of group of Japanese-Brazilians at Japanese Ambassador to Brazil’s official residence
Depart from Brasília International Airport on private government aircraft
Arrive at Guarulhos International Airport on the outskirts of São Paulo, Brazil

Saturday, August 2, 2014

AM

(Local time in Brazil)
Offer flowers at a cenotaph for Japanese immigrants to Brazil at Ibirapuera Park (Parque Ibirapuera) in São Paulo City. View Japanese Pavilion within park, plant commemorative tree
Press conference with domestic and foreign media at InterContinental Hotel
Attend seminar on medical regulations at Rosa Rosarum conference hall

PM
(Local time in Brazil)
Attend Japan-Brazil Business Forum in Rosa Rosarum conference hall, deliver commemorative speech
View Historical Museum of Japanese Immigration in Brazilian Society of Japanese Culture and Social Welfare headquarter building
Informal talk with Japanese-Brazilians
Welcome ceremony hosted by an organization of Japanese-Brazilians
Attend “Sport for Tomorrow” event at Tivoli Hotel
Depart from Guarulhos International Airport on personal government aircraft

Sunday, August 3, 2014
AM

(In transit)
PM
(In transit)

Provisional Translation by: Erin M. Jones

Whither Japan's economy

Monetary policy as golf
Mainly due to a severe downturn in personal consumption stemming from the April 1 consumption tax increase from 5% to 8%, Japan's GDP in April-June tumbled a real 6.8% from the previous quarter on an annualized basis.

This is  more than many had forecast including the IMF. Although a slow down of Japan's economy was expected, there remains uncertainty as to its longterm consequences. Will Japan grow again? Answers focus on Abe's "third arrow" of structural reform.

During his recent vacation Prime Minister Abe met with a number of his economic advisers both formally and over golf. It appears that maybe he may be having doubts about Japan's economic recovery expected from the Bank of Japan's quantitative and qualitative monetary easing policy introduced in April 2013. He appeared, if not for mere political expediency, listening to a number of competing opinions on the way forward.

Jackson Hole, Wyoming
On August 23, at the Jackson Hole, Wyoming, Federal Reserve of Kansas annual economic symposium among central bankers Bank of Japan (BoJ) Governor Haruhiko Kuroda focused his remarks [includes charts] on raising wages and promoting labor participation by women and elderly people. Once the BoJ succeeds in "firmly anchoring inflation expectations at 2 pct, this could provide the basis" for wage negotiations between labor and management, he said. He emphasized that increased labor participation rate of women and elderly was critical for staving off serious labor shortage due to the aging of population. Utilizing foreign workers also "deserve consideration," he added.

In an August 15th post, Structural Reforms Can Help Japan's Post-Consumption Tax Blues, on the IMF's blog iMFdirect, Stephan Danninger, a division chief in the IMF's Asia and Pacific Department, underscored the need for Japan to promote structural reforms quickly after the country's gross domestic product in April-June suffered the worst contraction in 13 quarters: "With the near-term outlook looking increasingly uncertain, the government needs to move quickly on the third arrow of structural reforms." 

This paper was a was a follow up analysis IMF's annual staff report (Article IV Consultation) on Japan issued July 31st. The IMF believes Japan’s economy will grow by about 1.6 percent this year, before slowing to 1.1 percent in 2015 as a result of fiscal adjustment. Inflation is expected to rise temporarily to 2.8 percent on average for 2014 due to recent increase in consumption tax rate, and we expect the Bank of Japan’s 2 percent target will be achieved over the medium term. The report urged Japan to steadily implement its economic growth strategy and promote fiscal consolidation.

Uninterrupted structural and fiscal reforms are "vital" to the success of Abenomics, the IMF said. Noting that "further consolidation is needed to contain large fiscal risks," the IMF urged Japan to move ahead with an additional consumption tax rate increase to 10 pct planned for October 2015 after the 3-percentage-point hike to 8 pct in April this year.

Based on the staff report, the IMF Executive Board pointed out in a statement that "significant downside risks (to the Japanese economy) remain in the medium term, including those arising from fiscal vulnerabilities." The IMF board stressed "The best way to minimize these risks is the
steadfast implementation of all the elements of the government's economic strategy,"

There appears to have been a conference accompanying the preparation of the  Consultation. Here are some of the papers presented.

Japan’s Corporate Income Tax: Facts, Issues and ReformOptions. Author/Editor: Ruud A. de Mooij; Ikuo Saito, IMF Working Paper No. 14/138.
     Explores how corporate income tax reform can help Japan increase investment and boost potential growth. Using international and Japan-specific empirical estimates of corporate tax elasticities, investment is predicted to expand by around 0.4 percent for each point of rate reduction. International consensus estimates suggest further that between 10 and 30 percent of the static revenue loss could be recovered in the long run through dynamic scoring, although Japan’s offset may be closer to the lower bound. Compensating fiscal measures are necessary in light of Japan’s tight fiscal constraints. The scope for base broadening in the corporate income tax is found to be limited and some forms of base broadening will undo positive investment effects of a rate cut. Alternative revenue sources include higher consumption and property taxes. A gradual approach toward lowering tax rates mitigates windfall gains and reduces short-run revenue costs. An incremental allowance-for-corporate-equity system could boost investment with limited fiscal costs in the short run.

Is Japan’s Population Aging Deflationary? Author/Editor: Derek Anderson ; Dennis P. J. Botman; IMF Working Paper No. 14/139.
     Japan has the most rapidly aging population in the world. This affects growth and fiscal sustainability, but the potential impact on inflation has been studied less. We use the IMF’s Global Integrated Fiscal and Monetary Model (GIMF) and find substantial deflationary pressures from aging, mainly from declining growth and falling land prices. Dissaving by the elderly makes matters worse as it leads to real exchange rate appreciation from the repatriation of foreign assets. The deflationary effects from aging are magnified by the large fiscal consolidation need. Many of these factors will beset other advanced countries as well, but we find that deflation risk from aging is not inevitable as ambitious structural reforms and an aggressive monetary policy reaction can provide the offset.

Balance Sheet Repair and Corporate Investment in Japan. Author/Editor: Joong Shik Kang; IMF Working Paper No. 14/141.
     Traces Japanese firms’ behavior over the last decades using aggregate corporate balance sheet data. Financial health of Japanese corporate sector has improved and firms paid back significant amount of debt and rebuilt their liquidity buffers. They also expanded abroad while the pace of corporate investment moderated. Regarding the latter, model estimates on aggregate corporate investment over the post bubble period show that expectation about future profitability, in particular medium-term demand outlook, has been the major driver, implying that a successful implementation of structural reforms could have positive impact even in the near term by improving the medium-term demand outlook.

Health Spending in Japan: Macro-Fiscal Implications and Reform Options.  Author/Editor: Masahiro Nozaki ; Kenichiro Kashiwase ; Ikuo Saito. IMF Working Paper No. 14/142.
     Health spending has risen rapidly in Japan. We find two-thirds of the spending increase over 1990–2011 resulted from ageing, and the rest from excess cost growth. The spending level will rise further: ageing alone will raise it by 3½ percentage points of GDP over 2010–30, and excess cost growth at the rate observed over 1990–2011 will lead to an additional increase of 2–3 percentage points of GDP. This will require a sizable increase in government transfers. Japan can introduce micro- and macro-reforms to contain health spending, and financing options should be designed to enhance equity.

Future of Asia’s Finance: How Can it Meet Challenges of Demographic Change and Infrastructure Needs? Author/Editor: Ding Ding ; Raphael W. Lam ; Shanaka J. Peiris; IMF Working Paper No. 14/126
     There is a role for Asia’s financial sector to play to address the challenges associated with the region’s changing demographics and infrastructure investment needs. Enhancing financial innovation and integration in the region could facilitate intra-regional financial flows and mobilize resources from the aging savers in industrialized Asia to finance infrastructure investment in emerging Asia. Strengthening the financial ties within the region as well as with the global financial markets alongside appropriate prudential frameworks could also help diversify sources of financing and reduce the cost of funding in emerging Asia. Finally, financial deepening could help ease the potential overheating from scaling up infrastructure investment and hence achieve a more balanced growth in the region. 

Prime Minister of Japan’s Schedule July 21-27, 2014

Monday, July 21, 2014

AM
12:00 At private residence (no visitors)
05:58 Depart from private residence in Tomigaya, Tokyo
07:02 Arrive at Three Hundred Golf Club, play golf with friends and secretaries. When asked “What is your mood while playing golf?” Mr. Abe answers “I’m enjoying myself, because spending time this way is the best.”

PM
12:42 Depart from golf course
02:05 Arrive at private residence

Tuesday, July 22, 2014

AM
12:00 At private residence (no visitors)
08:00 At private residence in Tomigaya, Tokyo (no morning visitors)
08:53 Depart from private residence
09:08 Arrive at LDP Party Headquarters
09:23 Meet with Head of LDP Ehime Chapter Shiozaki Yasuhisa, Governor of Ehime Prefecture Nakamura Tokihiro and colleagues
10:00 End meeting with Mr. Shiozaki, Mr. Nakamura and colleagues
10:01 Depart from LDP Party Headquarters
10:03 Arrive at office
10:05 Headquarters for Healthcare and Medical Strategy Promotion meeting
10:14 Meeting ends
10:22 Cabinet Meeting begins
10:31 Cabinet Meeting ends
10:41 Council on Economic and Fiscal Policy meeting
11:49 Meeting ends
11:50 Meet with former Deputy Chief Cabinet Secretary Matoba Junzo

PM
12:06 End meeting with Mr. Matoba
12:07 Lunch meeting with Chief of Staff for Joint Staff Council Iwasaki Shigeru, Ministry of Defense (MOD)’s Vice-Chief of Joint Staff Iwata Kiyofumi, Chief of Maritime Staff Kawano Katsutoshi, and Chief of Staff for Air Self-Defense Force Saito Harukazu
01:02 Lunch meeting ends
01:03 Speak with incoming Vice-Minister of Internal Affairs and Communications Oishi Toshio and outgoing Vice-Minister Okazaki Hiromi
01:09 Finish speaking with Mr. Oishi and Mr. Okazaki
02:13 Certificate of Appreciation Presentation Ceremony for Komura Masahiko and his colleagues in recognition of their assistance in saving another’s life
02:24 Ceremony closes
02:25 Ambassador to China Kitera Masato, Vice-Minister for Foreign Affairs Saiki Akitaka and Administrative Vice-Minster for Foreign Affairs Sugiyama Shinsuke enter
02:49 Mr. Sugiyama leaves
03:05 Mr. Kitera and Mr. Saiki leave
03:14 Speak with Kanto Region Chairman of the National Association of Postmasters [Zentoku] Osawa Makoto. LDP Upper House member Tsuge Yoshifumi also attends
03:24 Finish speaking with Mr. Osawa
03:42 Meet with Minister for Foreign Affairs Kishida Fumio, Ministry of Foreign Affairs (MOFA)’s Mr. Saiki, and Director-General of European Affairs Bureau Hayashi Hajime
04:15 End meeting with Mr. Kishida, Mr. Saiki and Mr. Hayashi
04:16 Meet with Ministry of Finance (MOF)’s Director-General of Budget Bureau Kagawa Shunsuke, Vice-Minister of Finance for International Affairs Yamasaki Tatsuo, and Director-General of International Bureau Asakawa Masatsugu
04:39 End meeting with Mr. Kagawa, Mr. Yamasaki, and Mr. Asakawa
05:00 Speak with MOFA’s Mr. Saiki and Director-General of Asian and Oceanian Affairs Bureau Ihara Junichi
05:09 Finish speaking with Mr. Saiki and Mr. Ihara
05:45 Phone Conference with Prime Minister of Israel Benjamin Netanyahu
06:15 Phone Conference ends
06:33 Summit Conference with President of Mongolia Tsakhia Elbegdorj
07:03 Summit Conference ends
07:06 Press release with Kyodo News
07:16 Press release ends
07:18 Depart from office
07:19 Arrive at official residence. Dinner meeting hosted by Prime Minister Abe Shinzo
08:33 See off President Elbegdorj
08:34 Finish seeing off Mr. Elbegdorj
08:35 Meet with Minister in Charge of the Abduction Issue Furuya Keiji, Advisor to Cabinet Office Mitani Hideshi, and Secretary-General of Headquarters for the Abduction Issue Ishikawa Shoichiro
09:35 End meeting with Mr. Furuya, Mr. Mitani and Mr. Ishikawa

Wednesday, July 23, 2014

AM
12:00 At official residence (no visitors)
08:00 At official residence (no morning visitors)
08:57 Depart from official residence
09:09 Arrive at JR Tokyo Station
09:20 Depart from station on Asama no. 511
10:09 Arrive at JR Takasaki Station
10:15 Depart from station
10:51 Arrive at Tomioka Silk Mill in Tomioka City, Gunma Prefecture. Reception by Commissioner of Agency for Cultural Affairs Aoyagi Masanori, Governor of Gunma Prefecture Osawa Masaaki, and Mayor of Tomioka City Iwai Kentaro. Try spinning silk, view workers’ lodgings. Informal talk with local volunteers
11:31 Depart from Tomioka Silk Mill
11:47 Arrive at plantation on an organic farm started by Kanra Town Organic Agriculture Association [甘楽町有機農業研究会 : Kanramachi Yukinogyo Kenkyukai] in Kanra Town, Gunma Prefecture. Reception by Mayor of Kanra Town Shigehara Shoichi. Sample tomatoes, try harvesting.

PM
12:08 Interview open to all media: When asked “What were your thoughts while viewing [the organic farm]?” Mr. Abe answers “I want regions to make the best of their own agricultural assets and continue moving toward recovery.”
12:12 Interview ends
12:13 Depart from organic farm
12:52 Arrive at JR Takasaki Station
01:06 Depart from station of Asama no. 524
01:55 Arrive at JR Tokyo Station
02:00 Depart from station
02:13 Arrive at office
02:15 Speak with Lower House member Aisawa Ichiro
02:29 Finish speaking with Mr. Aisawa
02:30 Meet with Senior Advisor to Komatsu, Ltd. Sakane Masahiro
02:59 End meeting with Mr. Sakane
04:30 Interview for NHK program
04:41 Interview ends
04:42 Minister for Foreign Affairs Kishida Fumio, Vice-Minister for Foreign Affairs Saiki Akitaka, MOFA’s Director-General of Foreign Policy Bureau Hiramatsu Kenji and Director-General of European Affairs Bureau Hayashi Hajime enter
05:07 Mr. Saiki, Mr. Hiramatsu, and Mr. Hayashi leave
05:12 Mr. Kishida leaves
05:13 Speak with Director-General of Bureau of Defense Policy Tokuchi Hideshi
05:17 Finish speaking with Mr. Tokuchi
05:18 Speak with incoming Attorney General of Japan Ono Kurao and outgoing Attorney General Ozu Hiroshi
05:33 Finish speaking with Mr. Ono and Mr. Ozu
05:36 Director of Cabinet Intelligence Kitamura Shigeru, Director of National Security Council (NSC) Yachi Shotaro, and Director of Cabinet Satellite Intelligence Shimohira Koji enter
05:54 Mr. Yachi and Mr. Shimohira leave
06:06 Mr. Kitamura leaves
06:07 Speak with MOD’s Director-General of Bureau of Operational Policy Nakajima Akihiko and Chief of Staff for Maritime Self-Defense Force Kawano Katsutoshi
06:17 Finish speaking with Mr. Nakajima and Mr. Kawano
06:35 Phone Conference with President-Elect of Indonesia Joko Widodo
06:45 Phone Conference ends
06:52 Depart from office
06:53 Arrive at official residence. Dinner meeting with LDP Vice-President Komura Masahiko and members of Ruling Coalition on the Development of Security Legislation. Chief Representative of New Komeito Yamaguchi Natsuo and Chief Cabinet Secretary Suga Yoshihide also attend
09:02 Everyone leaves

Thursday, July 24, 2014

AM
12:00 At official residence (no visitors)
08:00 At official residence (no morning visitors)
08:57 Depart from official residence
08:59 Enter Lower House 1st Diet Members’ Meeting Hall, receive dental examination at dentist’s office
09:27 Depart from the hall
09:29 Arrive at office
09:46 Filming for diplomatic relations video message
09:59 Filming ends
10:00 Meet with MOFA’s Director-General of Foreign Policy Bureau Hiramatsu Kenji
10:20 End meeting with Mr. Hiramatsu
10:22 Meet with Administrative Vice-Minister for Foreign Affairs Sugiyama Shinsuke; Director-General of Latin American and Caribbean Affairs Bureau Yamada Akira; Ministry of Agriculture, Forestry and Fisheries’ Administrative Vice-Minister Harihara Hisao; Ministry of Economy, Trade and Industry’s Administrative Vice-Minister Ishiguro Norihiko; MOF’s Director-General of International Bureau Asakawa Masatsugu; and Ministry of Land, Infrastructure, Transport and Tourism’s Director-General for International Affairs Inaba Kazuo. Deputy Chief Cabinet Secretary Seko Hiroshige, Senior Vice-Minister of Cabinet Office Nishimura Yasutoshi, and Special Advisor to the Prime Minister Kimura Taro also attend
11:50 End meeting with Mr. Sugiyama, Mr. Yamada, Mr. Harihara, Mr. Ishiguro, Mr. Asakawa, and Mr. Inaba

PM
12:04 Meet with LDP Secretary-General Ishiba Shigeru
01:00 End meeting with Mr. Ishiba
01:01 Government Ruling Parties meeting
01:12 Meeting ends
01:43 Depart from office
01:58 Arrive at United Nations University in Jingumae, Tokyo
01:59 Speak with President of UN Development Programme Helen Clark
02:12 Finish speaking with Ms. Clark
02:13 Attend the international announcement for UNDP Human Development Report, deliver address. Report Presentation Ceremony
02:27 Ceremony ends
02:28 Depart from United Nations University
02:41 Arrive at office
02:45 Minister in charge of Economic Revitalization Amari Akira, Vice-Minister of Cabinet Office Matsuyama Kenji, and Ministry of Economy, Trade and Industry’s Director-General of Economic and Industrial Policy Bureau Sugahara Ikuro enter
02:52 Mr. Matsuyama leaves
03:04 Mr. Amari and Mr. Sugahara leave
03:11 Receive courtesy call from Nemoto City Ritsu Habomai Junior High School 3rd-year student Nakajima Kyosuke and other junior high school students with Northern Territories Youth Cultural Exchange Service [北方少年交流事業: Hoppo Shonen Koryu Jigyo]
03:20 Courtesy call ends
03:31 Presentation of Fukushima Prefecture-Grown Vegetables with Governor of Fukushima Prefecture Sato Yuhei
03:36 Presentation ends
03:45 Meet with Director of Cabinet Intelligence Kitamura Shigeru
04:15 End meeting with Mr. Kitamura
05:07 NSC meeting, attended by Minister of Economy Trade and Industry Motegi Toshimitsu
05:29 NSC meeting ends
05:30 Meet with former Lower House Vice-Speaker Eto Seishiro
05:53 Finish speaking with Mr. Eto
05:55 Speak with LDP Headquarters for North Korean Abductions Chairman Yamatani Eriko and Secretary-General Tsukada Ichiro
06:08 Finish speaking with Ms. Yamatani and Mr. Tsukada
06:20 Depart from office
06:31 Arrive at Keidanren (Federation of Economic Organizations) Assembly Hall in Otemachi, Tokyo. Attend Keidanren Summer Forum, deliver address
07:03 Depart from assembly hall
07:13 Arrive at LDP Party Headquarters. Attend National Women Diet Members’ Political Investigative Committee [全国女性議員政策研究会の懇親会: Zenkoku Josei Giin Seisaku Kenkyukai no Konshinkai], give address. Take commemorative photo
07:35 Depart from party headquarters
07:38 Arrive at The Capitol Hotel Tokyu in Nagata-cho, Tokyo. Have dinner with secretaries at restaurant ORIGAMI in hotel
08:43 Depart from hotel
09:01 Arrive at private residence in Tomigaya, Tokyo

Friday, July 25, 2014

AM
12:00 At private residence (no visitors)
08:00 At private residence in Tomigaya, Tokyo (no morning visitors)
08:37 Depart from private residence
08:53 Arrive at office
08:54 Speak with Minister of State for Gender Equality Mori Masako
09:06 Finish speaking with Ms. Mori
09:11 Council on Economic and Fiscal Policy meeting
09:32 Meeting ends
09:46 Headquarters for Japan’s Economic Revitalization meeting
09:57 Meeting ends
10:01 Cabinet Meeting begins
10:25 Cabinet Meeting ends
10:32 Speak with Deputy Prime Minister and Minister of Finance Aso Taro
10:41 Finish speaking with Mr. Aso
10:56 Interview open to all media: When asked “What is the goal of your tour to Central and South America?” Mr. Abe answers “I want to move toward strengthening Japan’s relationship with Central and South America, tapping into the limitless potential [for the relationship] that has remained hidden.”
10:59 Interview ends
11:00 Depart from office
11:19 Arrive at Haneda Airport
11:41 Depart from airport on private government aircraft with wife Akie for tour of 5 Central and South American countries including Mexico

PM
01:00 Phone Conference with Prime Minister of Australia Tony Abbott while aboard aircraft
01:15 Phone Conference ends

AM
(Local time in Mexico)
Arrive at Mexico City Benito Juárez International Airport
Summit Conference with President of United Mexican States Enrique Peña Nieto

PM
(Local time in Mexico)
Agreement Signing Ceremony with President Peña Nieto at the National Palace [Palacio Nacional], and Joint Press Conference
Lunch meeting hosted by President Peña Nieto and his wife
Attend Japan-Mexico Economic Commission at Marriott Hotel and deliver address. Mr. Peña Nieto also attends

Saturday, July 26, 2014

AM
(Local time in Mexico)
View National Museum of Anthropology in Mexico City with wife Akie
Travel by helicopter to ruins of Teotihuacán on the outskirts of Mexico City, view ruins with President Peña Nieto and his wife
When asked “This is where former Prime Minister Koizumi Junichiro spoke of postal privatization, but today, of what have you spoken?” Mr. Abe answers “I have spoken of ridding [Japan] of deflation and of [pursing] regional restoration. If we wish to reach the top [of the pyramid] it will come to be, so I want to make [these things of which I have spoken] certain.”

PM
(Local time in Mexico)
Informal talk with leaders of Japanese-Mexicans’ group Japan-Mexico Association at Nichiboku Kaikan [日墨会館] in Mexico City
Attend Reception Commemorating Prime Minister Abe’s Visit, and deliver address

Sunday, July 27, 2014

AM
(Local time in Mexico)
Depart from Mexico City Benito Juárez International Airport

PM
(Local time in Trinidad and Tobago)
Arrive at Piarco International Airport in Trinidad and Tobago
Conference with Prime Minister of Trinidad and Tobago Kamla Persad-Bissessar at Diplomatic Center in Port of Spain, Trinidad and Tobago
Conference with Prime Minister of Antigua and Barbuda Gaston Browne at Hilton Hotel
Continue conference with addition of Prime Minister of Jamaica Portia Simpson-Miller
Reception dinner hosted by Prime Minister Persad-Bissessar at Diplomatic Center

Provisional Translation by: 
Erin M. Jones

Dutch Comfort Women and the Consequences

Thea Bisenberger-van der Wal
autobiography
On July 30th two Korean former Comfort Women had extended meetings with White House and the State Department staff. They had traveled to Washington to celebrate the 7th anniversary of House Resolution 121 recognizing their sexual slavery to Imperial Japan's military and asking for an unequivocal apology from Japan's government.

As the Abe Government protests that their tales are fabricated, the rest of the world believes them more. This is reinforced by more scholarship and efforts of daughters and granddaughters to tell their mother's story.

Little, however, is said of the non-Korean victims of Japan's Comfort Women scheme. Most of the women, girls, and boys pressed to service and"comfort" the Imperial Japan's military were opportunities of war and occupation. The victims came from every city, plantation, territory and island occupied by Imperial Japan's military. The accounts of the brutal subjugation cemented by rape and pillage are amazingly similar whether they are told by Andaman Islanders or Singapore urbanites; Filipino peasants or Borneo headhunters.

Moentilan, Xavier College
 None were more vulnerable than the women and girls who became prisoners in Japanese concentration camps in the Dutch East Indies. In the camps the Japanese officers chose at will, yet with deliberation, the women they wanted. Some, mainly British and Australian women, were survivors of ships bombed by Japan off the coast of Sumatra. They recall being given a choice: starve or submit.

Most, however, were Dutch girls and young mothers who had been forced from their homes into squalid and overcrowded locations, often former convents or schools. They were shut off from the world, with little food, limited sanitation, and surrounded by guards and barbed wire. The men and boys over 10 were sent off to slave on Burma-Thai Death Railway or other military projects. It is was never clear what was the intent or when would be the end of the internment. In late July and early August 1945, the consolidation of these internment camps and rumors from sympathetic guards suggested that the internees were all to be killed.

With some notable exceptions most of the hundreds of women forced to prostitute themselves for the Emperor never spoke of their experience or came forward to ask for compensation. The shame was too raw, too deep. It is therefore impossible to confirm the numbers of women subjected to this sexual abuse. Only 35 women were included in the 1946-47 Batavia War Crimes trial that charged 12 Japanese Army officers of having committed war crimes that included, for the first time "forced prostitution." The full records of these proceedings are sealed as are the names of the women involved until 2025.

Thus, the following news is unusual and deeply from the heart.

Dutch Woman Speaks About Mother's Experiences Of Sexual Slavery

By Chang Jae-soon, correspondent

WASHINGTON, Aug. 18 (Yonhap) -- Thea Bisenberger-van der Wal says she still remembers sitting on the steps of a church in Indonesia back in 1944 while waiting for her mother to come out. Her mother always cried but only told her, then aged 4, that she had fallen.

The mother never spoke to her of what really happened in the church for the rest of her life until she died 10 years ago, Bisenberger said, though she constantly suffered from nightmares because of the indelible experiences: sexual slavery by Japanese troops.

Bisenberger, now living in Canada, provided some details of what her mother went through in a letter to the Asia Policy Point, a nonprofit research center studying the U.S. policy on Northeast Asia. Mindy Kotler, director of the center, disclosed the letter to Yonhap News Agency on Monday.

Bisenberger has been calling for an apology from Japan.

It is not new news that Dutch women were among the victims of Japan's sexual enslavement during World War II, but the case shows the issue still remains unresolved not only for Korean victims but for victims of other countries as well.

At least 65 Dutch women were believed to be among the victims, known euphemistically as "comfort women." [NB: 79 women and men were willing to accept Japanese medical payments in the late 1990s]

"Not all the comfort women were Korean," Kotler said. "They were pressed into service on every island and territory invaded by Japan. The rapes were proof of victory and power for the Japanese and loss and humiliation for the conquered people."

Monthly Dutch Demonstration at the
Japanese Embassy in The Hague 
Bisenberger said she learned of her mother's experiences in 2009 when a younger sister of her mother told her about it. The aunt was the only one to whom the mother revealed what happened because she wanted to spare her mother about the tragic story, Bisenberger said.


"My mother and her sister were raped while in a concentration camp in Moentilan. There was a church on this property and it was the former Xavier college. In this church happened the most horrible things during our captivity," Bisenberger said in the letter of what happened in January 1944.

The horrible experiences left deep scars on their hearts, she said. Her mother's sister even attempted suicide while in the concentration camp, but her mother saved the sister, Bisenberger said.

Bisenberger said that once a year she attends a rally that a group of Dutch people hold every second Tuesday of the month in front of the Japanese Embassy in The Hague.

"After the war, my mother always had nightmares, which never went away," she said. "When a war is over, it's never over for the victims who survive, which is very sad. Even the children will always wonder if the things they have in their heads were real. My mother always tried to erase them." 

APP Editor: You can read more about Thea Bisenberger van der Wal's experiences on her blog, Coconut Connections.

Saturday, August 16, 2014

Prime Minister of Japan’s Schedule July 14-20, 2014

Monday, July 14, 2014
AM
12:00 At official residence (no visitors)
07:27 Depart from official residence
07:28 Arrive at office
07:30 Meet with Deputy Chief Cabinet Secretary Kato Katsunobu
08:08 End meeting with Mr. Kato
08:52 Depart from office
08:53 Arrive at Diet
08:55 Enter Lower House 1st Committee Members’ Room
08:56 Speak with LDP Vice-President Komura Masahiko
08:57 Finish speaking with Mr. Komura
08:58 Lower House Budget Committee convenes

PM
12:00 Lower House Budget Committee recess
12:01 Leave Lower House 1st Committee Members’ Room
12:03 Depart from Diet
12:05 Arrive at office
12:10 Ruling Party Liaison Conference
12:31 Conference ends
12:32 Speak with Deputy Prime Minister and Minister of Finance Aso Taro and Director-General of LDP Election Strategy Committee Kawamura Takeo
12:33 Finish speaking with Mr. Aso and Mr. Kawamura
12:55 Depart from office
12:56 Arrive at Diet
12:58 Enter Lower House 1st Committee Members’ Room
01:00 Lower House Budget Committee reconvenes
05:06 Committee adjourns
05:07 Leave Lower House 1st Committee Members’ Room
05:09 Depart from Diet
05:11 Arrive at office
05:12 Meet with Ministry of Foreign Affairs (MOFA)’s Administrative Vice-Ministers Saiki Akitaka and Sugiyama Shinsuke, Foreign Policy Bureau Director-General Hiramatsu Kenji, and Director-General of European Affairs Bureau Hayashi Hajime
05:42 End meeting with Mr. Saiki, Mr. Sugiyama, Mr. Hiramatsu, and Mr. Hayashi
05:43 Speak with Minister of Defense Onodera Itsunori
05:49 Finish speaking with Mr. Onodera
06:06 Depart from office
06:15 Arrive at Imperial Palace, register return to Japan
06:22 Depart from Imperial Palace
06:32 Arrive at Hotel Okura in Toranomon, Tokyo. Attend reception for International Conference of Industrial Heritage in banquet hall Heian Room
07:01 Depart from hotel
07:06 Arrive at official residence
07:07 Dinner meeting with President of Asian Forum Japan (AFJ) Yoshihara Kinichi
08:46 Meet with Chairman of Lower House Committee on Cabinet Shibayama Masahiko
09:21 End meeting with Mr. Shibayama

Tuesday, July 15, 2014

AM
12:00 At official residence (no visitors)
07:17 Depart from official residence
07:18 Arrive at office
07:19 Meet with Deputy Chief Cabinet Secretary Seko Hiroshige
08:21 End meeting with Mr. Seko
08:23 Cabinet Meeting begins
08:34 Cabinet Meeting ends
08:35 Meet with Mr. Seko
08:52 End meeting with Mr. Seko
08:55 Depart from office
08:56 Arrive at Diet
08:58 Enter Upper House 1st Committee Members’ Room
09:00 Upper House Budget Committee convenes
11:54 Committee recess
11:55 Leave room
11:56 Depart from Diet
11:59 Arrive at office

PM
12:54 Depart from office
12:56 Arrive at Diet
12:58 Enter Upper House 1st Committee Members’ Room
01:00 Upper House Budget Committee reconvenes
05:22 Committee adjourns
05:23 Leave room
05:25 Depart from Diet
05:27 Arrive at office
L to R: Green, Nye, Blair, Armitage, Hamre, Abe
REPORT
05:31 Director of Cabinet Intelligence Kitamura Shigeru, National Security Council (NSC) Director Yachi Shotaro, and Cabinet Satellite Intelligence Center Director Shimohira Koji enter
05:46 Mr. Yachi and Mr. Shimohira leave
05:52 Mr. Kitamura leaves
05:55 Meet with U.S.-Japan Commission on the Future of the Alliance’s U.S. think tank CSIS President John J. Hamre and colleagues
[funded by Sasakawa Peace Foundation]
06:20 End meeting with Mr. Hamre
06:41 Depart from office
06:45 Arrive at ANA Intercontinental Hotel Tokyo in Akasaka, Tokyo. Attend and give address at the meeting of a nursing policy group [看護政策懇話会 : Kango Seisaku Konwakai] in Japanese restaurant Unkai
07:05 Depart from hotel
07:11 Arrive at official residence

Wednesday, July 16, 2014

AM
12:00 At official residence (no visitors)
07:35 Depart from official residence
07:46 Arrive at JR Tokyo Station
07:56 Depart station on Hayabusa No. 101
09:30 Arrive at JR Sendai Station
09:38 Depart from station. Minister for Reconstruction Nemoto Takumi accompanies
10:26 Arrive at Fisheries Promotion Center in Shichigahama Town, Miyagi Prefecture. Reception with Vice-Governor of Miyagi Prefecture Wako Masahiro and Mayor of Shichigahama Town Watanabe Yoshio. Pray in front of cenotaph. View Fisheries Promotion Center
10:51 Depart from Fisheries Promotion Center
11:46 Arrive at agricultural corporation Agriead Naruse [アグリードなるせ] in Nobiru, Higashimatsuyama City, Miyagi Prefecture. Reception by Mayor of Higashimatsuyama City Abe Hideo. View site
12:08 Depart from Agriead Naruse
12:25 Arrive at wedding hall Presetir Uchiyasu in Omagari, Higashimatsuyama City. Have lunch with Mr. Wako and Mr. Abe
12:54 Depart from wedding hall
01:00 Arrive at emergency housing in Komatsu, Higashimatsuyama City. View housing and have informal talk with occupants
01:21 Interview open to all media: When asked “What were your thoughts while viewing [the emergency housing]” Mr. Abe answers “[I felt] a sense that livelihood [in the region] will be once again certain through continued reconstruction efforts”
01:25 Interview ends
01:27 Depart from emergency housing
02:24 Arrive at JR Sendai Station
02:44 Depart from station on Yamabiko No. 144
04:50 Arrive at JR Tokyo Station
04:54 Depart from station
05:07 Arrive at office
05:08 Minister of Finance Aso Taro, Ministry of Finance’s Budget Bureau Director-General Kagawa Shunsuke, Budget Bureau Director-General Tanaka Kazuho, and Tax Bureau Director-General Sato Shinichi enter
05:35 Mr. Kagawa, Mr. Tanaka and Mr. Sato leave
05:46 Mr. Aso leaves
05:47 Speak with former Ambassador to Myanmar Numata Mikio
05:52 Finish speaking with Mr. Numata
05:53 Meet with Ministry of Defense’s Bureau of Defense Policy Director-General Tokuchi Hideshi and Joint Staff Council’s Chief of Staff Iwasaki Shigeru
06:10 End meeting with Mr. Tokuchi and Mr. Iwasaki
06:37 Meet with French Ambassador to Japan Christian Masset
06:52 End meeting with Mr. Masset
07:05 Dinner with a group of ambassadors from Islamic countries
07:26 Finish dinner
07:27 Depart from office
07:29 Arrive at official residence

Thursday, July 17, 2014

AM
12:00 At official residence (no visitors)
08:00 At official residence (no morning visitors)
08:35 Depart from official residence
08:36 Arrive at office
08:37 Meet with Minister in charge of Civil Service Reform Inada Tomomi and Director-General of Personnel Affairs Kato Katsunobu
09:01 End meeting with Ms. Inada and Mr. Kato
09:02 Minister in charge of TPP Amari Akira, Chief Domestic Coordinator of Government Headquarters for the TPP Sasaki Toyonari and Chief Negotiator Tsuruoka Koji enter
09:17 Mr. Sasaki and Mr. Tsuruoka leave
09:29 Mr. Amari leaves
09:33 Council for Science, Technology and Innovation meeting
10:01 Meeting ends
10:08 Council for the Protection of Information meeting
11:00 Meeting ends
11:01 Speak with Administrative Vice-Minister of Defense Nishi Masanori
11:15 Finish speaking with Mr. Nishi
11:47 Courtesy call from Mayor of Kunimi Town (in Fukushima Prefecture), Miss Peach Lady Aikawa Kaede, and others
11:53 Courtesy call ends
11:54 Meet with Director of Kyoto University’s Kokoro Research Center Yoshikawa Sakiko

PM
01:20 End meeting with Ms. Yoshikawa
01:21 Speak with critic Nishimura Kohyu
01:32 Finish speaking with Mr. Nishimura
01:33 Meet with Governor of Tokyo Prefecture Masuzoe Yoichi. Chief Cabinet Secretary Suga Yoshihide also attends
01:53 End meeting with Mr. Masuzoe
01:58 Receive courtesy call from a South Korean media delegation led by Editor-in-Chief of Chosun Ilbo Song Hee-young, and colleagues
02:31 Courtesy call ends
02:32 Meet with LDP Lower House member Kawai Katsuyuki
02:48 End meeting with Mr. Kawai
03:31 Depart from office
03:33 Arrive at Lower House 1st Diet Members’ Meeting Hall, dental examination at dentist’s office inside the hall
04:21 Depart from meeting hall
04:23 Arrive at office
04:27 Council for the Promotion of Social Security Reform meeting
04:29 Meeting ends
04:30 Meet with Minister of Land, Infrastructure, Transport and Tourism Ohta Akihiro
04:49 End meeting with Mr. Ohta
04:50 Speak with Special Advisor to the Prime Minister Isozaki Yosuke
05:00 Finish speaking with Mr. Isozaki
05:02 Ministerial Council on Monthly Economic Report and Other Relative Issues meeting
05:25 Meeting ends
05:30 NSC meeting commences. Minister of Economy, Trade and Industry Motegi Toshimitsu also attends
05:47 Mr. Motegi leaves
06:25 NSC meeting adjourns
07:07 Depart from office
07:08 Arrive at official residence

Friday, July 18, 2014

AM
12:00 At official residence (no visitors)
08:00 At official residence (no morning visitors)
08:28 Depart from official residence
08:29 Arrive at Diet
08:30 Interview open to all media: When asked “What was your correspondence with the government concerning the Malaysian plane crash?” Mr. Abe replies “After the incident, at the next NSC meeting we are scheduled to talk about the status of investigation of the cause, analysis, and information gathering.”
08:31 Interview ends
08:49 Speak with Minister in charge of Economic Revitalization Amari Akira and Vice-Minister of Cabinet Office Matsuyama Kenji
09:01 Finish speaking with Mr. Amari and Mr. Matsuyama
09:06 Nine Ministers’ Group of National Security Council meeting
09:21 Meeting ends
09:31 Headquarters for Water Cycle Policy meeting
09:39 Meeting ends
09:42 Cabinet Meeting begins
10:01 Cabinet Meeting ends
10:02 Speak with incoming Administrative Vice-Minister of Health, Labour and Welfare Hara Katsunori and outgoing Administrative Vice-Minister Ebata Jun
10:07 Finish speaking with Mr. Hara and Mr. Ebata
10:08 Speak with incoming Vice-Minister of Land, Infrastructure, Transport and Tourism Honda Masaru and outgoing Vice-Minister Masuda Yuichi
10:10 Finish speaking with Mr. Honda and Mr. Masuda
10:11 Speak with incoming Vice-Minister of the Environment Suzuki Masaki and outgoing Vice-Minister Yatsu Ryutaro
10:12 Finish speaking with Mr. Suzuki and Mr. Yatsu
10:13 Speak with incoming Vice-Minister Internal Affairs and Communications Oishi Toshio and outgoing Vice-Minister Okazaki Hiromi
10:14 Finish speaking with Mr. Oishi and Mr. Okazaki
10:22 Meet with Director of Cabinet Intelligence Kitamura Shigeru
10:52 End meeting with Mr. Kitamura
11:01 MOFA’s Vice-Minister Saiki Akitaka, Foreign Policy Bureau Director-General Hiramatsu Kenji, and Director-General of Middle Eastern and African Affairs Bureau Uemura Tsukasa enter
11:25 Mr. Uemura leaves
11:36 Mr. Saiki and Mr. Hiramatsu leave
11:38 Receive courtesy call from Yamanashi Fruit Lady Hayakawa Yukari, Governor of Yamanashi Prefecture Yokouchi Shomei and others
11:50 Courtesy call ends

PM
12:16 Depart from office
12:41 Arrive at Haneda Airport
01:05 Depart from airport on ANA Flight 3879
02:24 Arrive at Kitakyushu Airport
02:35 Depart from airport
03:10 Arrive at hydrogen dispensing facility Kitakyushu Hydrogen Station [北九州水素ステーション] in Yahatahigashi-ku, Kitakyushu City. Reception with LDP Lower House member Mihara Asahiko and colleagues. Test drive a fuel-cell car
03:24 Depart from Kitakyushu Hydrogen Station
03:31 Arrive at real estate section Hachiman of Yawata Steel Works, belonging to Nippon Steel Corporation. View the steel works [Company used Allied POW slave labor, many Americans and British Indian Army]
03:46 Depart from the steel works
04:17 Arrive at poultry farm Hatanaka Ikusujyo [畠中育雛場] in Iizuka City, Fukuoka Prefecture. Sample tamagokakegohan (raw egg over rice) and ice cream, purchase roll cake
04:33 Depart from poultry farm
05:23 Arrive at TNC Broadcasting Center in Sawara Ward, Fukuoka City. Test out robots in testing space Robo Square, and exchange ideas with managers of start-up companies
05:48 Interview open to all media: When asked “What was your goal in inspecting the hydrogen station?” Mr. Abe answers “[To see] the car of a new era, that is easy on the environment. I want the Japanese Government starting with government officials to begin adhering strictly to the use of this car.”
05:53 Interview ends
05:56 Depart from TNC Broadcasting Center
06:10 Arrive at Nakasu District in Hakata Ward, Fukuoka City. Participate in parade opposing Fukuoka crime syndicates
06:24 Depart from Nakasu District
06:28 Arrive at traditional Japanese restaurant Sagano in Hakata Ward. Dinner meeting with Chairman of Kyushu Economic Federation Aso Yutaka, Chairperson of Kyushu Electric Power Company Nuki Masayoshi, Chairman of JR Kyushu Ishihara Susumu and Executive Vice-President of TOTO Saruwatari Tatsuhiko
08:34 Depart from restaurant
09:51 Arrive at personal residence in Shimonoseki, Yamaguchi Prefecture

Saturday, July 19, 2014

AM
12:00 At personal residence (no visitors)
08:00 At personal residence in Shimonoseki City, Yamaguchi Prefecture
09:48 Depart from residence
10:12 Arrive at temple Togyoan in Shimonoseki. Offer flowers at grave of Takasugi Shinsaku
10:53 Depart from temple
10:57 Arrive at asparagus farm Murajo Yume Plantation [村上夢農園 : Murajo Yume Nouen] in Shimonoseki City. Harvest some asparagus, have lunch

PM
12:06 Depart from Murajo Yume Plantation
12:41 Arrive at wedding hall Seamall Palace in Shimonoseki City
12:45 Interview with TV Yamaguchi in conference room Botan
01:05 Interview ends
01:33 Attend meeting of a women support group in banquet hall Emerald
02:44 Meeting ends
02:45 Depart from Seamall Palace
02:48 Arrive at shop Shimonoseki Daimaru and browse
02:50 Depart from shop
02:53 Arrive at Shimonoseki Station Building ripie in Shimonseki City and browse. Take commemorative photo with children at Shimonoseki City facility for nurturing the next generation Fukufuku Kodomokan [ふくふくこども館]
03:11 Depart from ripie
03:12 Arrive at JR Shimonoseki Station, view the station. Mayor of Shimonoseki City Nakao Tomiaki accompanies
03:24 Depart from station
03:30 Arrive at movie theater Cinema Sunshine Shimonoseki in Shimonoseki City and browse
03:35 Depart from movie theater
03:40 Arrive at Shimonoseki City Hall and browse. Give lecture at Choshu Seiron Forum One-Year Anniversary Commemorative Symposium in great hall
05:39 Depart from Shimonoseki City Hall
05:44 Arrive at Seamall Palace, informal talk with Choshu Seiron Forum members in banquet hall Emerald
07:23 Depart from Seamall Palace
07:29 Arrive at yakiniku restaurant Yakiniku Yasumori Shimonoseki Green Mall Main Shop in Shimonoseki City. Dinner meeting with LDP Lower House member Inoue Takahiro, Governor of Yamaguchi Prefecture Muraoka Tsugumasa, and President of Sankei Shimbun Kumasaka Takamitsu
09:00 Depart from yakiniku restaurant
09:12 Arrive at personal residence

Sunday, July 20, 2014

AM
12:00 At personal residence (no visitors)
07:59 Depart from personal residence in Shimonoseki City, Yamaguchi Prefecture
08:36 Arrive at Kitakyushu Airport
09:06 Depart from airport on ANA Flight 3876
10:21 Arrive at Haneda Airport
10:37 Depart from airport
11:07 Arrive at international convention complex Pacifico Yokohama in Nishi Ward, Yokohama City. Attend and give lecture at Summer Conference 2014 hosted by Junior Chamber International Japan [日本青年会議所 : Nippon Seinen Kaigisho] in Exhibition Hall

PM
12:01 Depart from Pacifico Yokohama
12:41 Arrive at hotel Grand Hyatt Tokyo in Roppongi, Tokyo. Exercise at NAGOMI Spa and Fitness
04:09 Depart from hotel
04:33 Arrive at private residence in Tomigaya, Tokyo

Provisional Translation for APP by Erin M. Jones

Friday, August 15, 2014

Japan is liberated

August 15, 1945

Wednesday, August 13, 2014

Asia in Washington in August

Ordinarily August is the Silly Season, meaning it is a slow news month. Unfortunately it was canceled this year in favor of war, pestilence, genocide, ignorance, and just plain pig-headedness.

8/14 - International Comfort Women Day
8/15 - 1945. Japan Surrenders
8/18 - Pope Francis performs Mass in Seoul
8/19 - UN World Humanitarian Day

IRAQ: WHAT IS HAPPENING? 8/14, 12:15-1:45pm. Sponsor: New America Foundation. Speakers: Col. Derek Harvey (Ret.), Professor, University of South Florida, and Former Senior Analyst for Iraq for General David H. Petraeus; Denise Natali, Senior Research Fellow, Institute for Strategic Studies, National Defense University, and author, The Kurdish Quasi-State: Development and Dependency in Post-Gulf War Iraq; Steve Levine, Future Tense Fellow, New America Foundation, and Author, The Oil and the Glory, The Pursuit of Empire and Fortune on the Caspian Sea; and Douglas A. Ollivant, Senior National Security Fellow, International Security Program, New America Foundation, and Former NSC Director for Iraq.

HAS SOUTH KOREA SQUANDERED ITS DEMOGRAPHIC DIVIDEND? 8/18, 12:30-2:00pm. Sponsor: CSIS, Korea Chair. Speaker: Elizabeth Hervey Stephen, Associate Professor of Demography, Edmund A. Walsh School of Foreign Service, Georgetown University.

HISTORY IMPEDES FUTURE PROGRESS IN NORTHEAST ASIA. 8/19, 2:00-5:30pm. Sponsor: Heritage Foundation. Speakers: Admiral Dennis C. Blair, USN (Ret.), Chairman, Sasakawa Peace Foundation USA, former Commander, U.S. Pacific Command, and former Director, National Intelligence; Ahn Ho-Young, Ambassador of the Republic of Korea to the United States; Lee Sung-yoon, Professor, Fletcher School , Tufts University; Scott Snyder, Senior Fellow, Council on Foreign Relations; Yuki Tatsumi, Senior Associate, East Asia Program, Stimson; Victor Cha, Senior Adviser and Korea Chair, CSIS, and former Director for Asian Affairs, National Security Council; Bruce Klingner, Senior Research Fellow, Northeast Asia, Heritage; Evans Revere, Senior Advisor, Albright Stonebridge Group, and former Principal Deputy Assistant Secretary of State; and Walter Lohman, Director, Asian Studies Program, Heritage. 

BEYOND THE QUAGMIRE: THE FUTURE OF MONGOLIA’S UNITED STATES AND JAPAN PARTNERSHIPS. 8/20, Noon-1:30pm. Sponsor: East West Center Washington. Speaker: Mr. Mendee Jargalsaikhan, Visiting Fellow, East-West Center in Washington, Doctoral Candidate, University of British Columbia.

SILICON GLOBALIZATION AND ITS CONSTRAINTS: THE RISE OF CHINA'S AND INDIA’S SEMICONDUCTOR INDUSTRIES. 8/27, 9:00-10:30am. Sponsor: Information Technology and Innovation Foundation (ITIF). Speakers: David M. Hart (moderator), Director, Center for Science and Technology Policy, School of Public Policy, George Mason University; Douglas Fuller, Professor, Department of Business Administration, Zhejiang University’s School of Management; Robert D. Atkinson, President, ITIF; Jimmy Goodrich, Director of Global Policy, Information Technology Industry Council; and Brian Toohey, President & Chief Executive Officer, Semiconductor Industry Association.

WOMEN, PEACE AND SECURITY: PRACTICAL GUIDANCE ON USING LAW TO EMPOWER WOMEN IN POST-CONFLICT SYSTEMS. 8/27, 10:00-11:30pm. Sponsors: Women In International Security, Women's Action for New Directions, and the U.S. Institute of Peace. Speakers: Julie L. Arostegui, Toolkit Author and Director, Women, Peace and Security Policy, Women's Action for New Directions; Sanam Naraghi-Anderlini, Executive Director and Co-Founder, International Civil Society Action Network; Susan Stigant, Senior Program Officer, Rule of Law, US Institute of Peace; Susan Markham, Senior Gender Coordinator, USAID; and Chantal de Jonge Oudraat, President, Women in International Security. 

PUBLIC OPINION AND WAR. 8/28, 2:00-4:00pm. Sponsor: Cato Institute. Speakers: Adam Berinsky, professor of political science, MIT; John Mueller, professor of political science, Ohio State University and senior fellow, Cato; Jason Reifler, senior lecturer, University of Exeter; Trevor Thrall, associate professor of public and international affairs, George Mason University; and Justin Logan, director of foreign policy studies, Cato.

Tuesday, August 12, 2014

It’s time to update our thinking on trade

IT’S TIME TO UPDATE OUR THINKING ON TRADE 

by William H. Overholt, President, Fung Global Institute, Senior Fellow at Harvard’s Asia Center, and APP Board Member
First published by the East Asian Forum, August 3 2014

Our institutions for governing world trade and our thinking about world trade date back to a simpler era. Without a radical rethink, we risk the gradual decay of our most valuable international institutions, loss of extraordinary opportunities to improve global living standards and possibly the sidelining of the West in developing modern institutions.

The GATT and the WTO were devised for a simpler era, when it was possible to think about world trade in the way Ricardo taught — namely that a good is produced in one country and consumed also in a single country. If Portugal was adeptat making wine and England at cloth, it would benefit both to reduce barriers and enhance trade. That two-country model worked relatively well until about 1978, when China started opening its economy by establishing special economic zones across the border from Hong Kong.

By the last decade of the twentieth century, production had become a complex global process. The logic of increasing efficiency by reducing trade barriers remained completely valid, but policy adaptation of that logic to a new era has faltered.

A laptop or a smart phone now is typically made in 15 to 20 countries. When old-style trade thinking is applied to this situation, confusion causes bad policy and gratuitous conflicts. A laptop made in 17 countries might be assembled in China for $2 worth of local wages then exported to the United States, but old two-country thinking leads members of Congress to react as if China had exported $1500 of value to the US. This bolsters protectionism, reduces support for multilateral trade liberalisation and contributes to the fragmentation of the global trade regime.

Because it is difficult to continue the process of trade liberalisation, countries feeling a need for deeper integration form their own regional blocs, inducing further fragmentation.

Regional and bilateral trade negotiations today are focused on ‘country of origin’, by definition a single country or preferential grouping, with the result that it is considered normal to have 500 pages of country of origin rules in a single trade agreement. Since each country has many trade agreements, companies may find the rules so complex that they simply pay high tariffs rather than trying to manage the complex paperwork to prove countries of origin. The complexity of the system discriminates against small, open economies like Singapore, and it discriminates against smaller companies without huge accounting departments. Because it cannot adapt to the globalisation of production, the system is beginning to defeat itself.

Moreover, the addition of over one billion new workers to the globalised workforce entailed very low wages in Eastern countries such as China, flat wages in the West and huge trade imbalances between East and West. This discouraged Western countries from vigorously pursuing the kinds of global agreements that would have eliminated those dozens of separate, conflicting 500-page rule books about countries of origin.

Feeling overwhelmed by Chinese manufactured exports, Western countries have also moved to exclude China from the most important efforts to modernise the global trading system. The proposed Trans-Pacific Partnership (TPP) and Transatlantic Trade and Investment Partnership agreements (TTIP) both seek to exclude the world’s second-largest economy from potential membership, an arrangement that is both economically untenable and a potential geopolitical disaster.

The geopolitical consequences were magnified by the inclusion of Japan in the TPP agreements, even though Japan’s economy is much less open than China’s and historically has been much less willing to reform in the face of domestic interest group pressure than China has. Given Sino-Japanese tensions, this has come across in Asia as part of a strategy to isolate China.

Magnifying Sino-American differences could make a more inclusive, truly multilateral future trade system much harder to negotiate.

While we still flounder over attempts to come to terms with globalised production, we are heading into globalised consumption. Instead of an era with one billion new globalised workers, we are heading into a world that will contain two billion or more new middle class consumers, mainly in Asia and heavily in China. Chinese wages are rising 13 to 20 per cent a year and total compensation is rising even more. This phenomenon should gradually resolve the most serious trade imbalances and begin to allow Western wages to rise.

But Western media, interest groups and politicians remain obsessed with the problems of yesterday. This could lead the West to squander one of the greatest economic opportunities in world history, namely the extraordinary consumer boom in China, India and other emerging markets. It could also disastrously delay responses to the jobs challenge of the new era: a technology-driven transformation of the workplace driven by robots, other automation, the internet of things and 3D printing that will eventually force billions of workers out of old jobs.

We must begin addressing the world as it is and will be, not the world of generations past. Ironically, in the process the WTO remains crucial to a vibrant world economy. Without the WTO’s dispute settlement mechanism, trade wars will ignite everywhere. By allowing the WTO system to decay, and by blaming globalised trade for problems that are unique to the past generation, we risk going back to pre-World War II trade wars. We need a modern, multilateral structure that updates the WTO, not a degeneration of the global trade and investment system based on a failure to recognise the shape of the new world we are entering.

We are now at one of those great historical turning points. Disillusionment, often misplaced, with existing institutions and obsession with obsolescent problems have allowed the process of trade negotiations to decay so far that TPP and TTIP negotiations could fail or, if they succeed, the exclusion of China could make them Pyrrhic victories. Continued Western failure to address the real issues of our emerging world of globalised production and consumption, and the reality of China’s central role, could lead to trade regimes with the most dynamic markets governed by structures like the Regional Comprehensive Economic Partnership promoted by Asian emerging economies.
The views expressed here are personal and not endorsed byDr. Overholt's employers.