Summaries of the Award-Winning Essays of JFTC Essay Competition 2015
The Prize for Excellence
Taking the lead : Establishing new channels providing investment yield, high wages and skills development in order to attract foreign resources
Mr. Kieran Hull (U.K., age 26)
Japan lags its peers on inflows of foreign resources, despite having strong linkages to the world economy. This would suggest that foreign resources are able to enter Japan, but do not at desired levels. The country must therefore appeal more strongly to capital and labor from abroad by increasing investment yield, wages and skills development. Enhancing existing resource flow channels is important, but the focus of this paper is on innovative policy ideas that would make Japan a global leader in new areas. Leadership in vibrant economic sectors will attract investment and workers.
This paper has 3 sections – agriculture, manufacturing and services. Each sector is analyzed individually using the following framework. First, what is the sector’s current performance? Second, what kind of policies can drive resource attraction? Third, which stakeholders will be involved? Finally, how effective will such policies be and what are the spillover effects?
The findings are mixed. Starting with the weakest area of the economy, this paper shows agriculture to be strategically important but unproductive. Reforms in the sector are required; however, these will take time. More immediately, the focus should be on skills development in attracting foreign resources. Japan’s selling point is high-end produce cultivated by experienced farmers. Attracting labor through agritourism can help bolster employment numbers and result in knowledge transfers and efficiency gains in the sector.
Manufacturing is stronger but not without problems. The industry must look to continue its position as global leader, but in a more investor-friendly corporate governance environment. Japan can seize momentum through coordinated innovations under various global initiatives which may define world manufacturing for the next generation: for example, a fourth industrial revolution under ‘Industry 4.0’. Japan can help set global standards yet to be established, becoming an important center to which investment and skills gravitate.
Finally, services is an area of strength. This paper recommends policies that leverage Japan’s expertise. For example, Japan can be an incubator for the development of services for other countries. The benefits are two-fold: first, by taking advantage of the transportability of services, resources can flow to Japan. Second, there will be a positive impact in terms of growth and development for those looking to learn from Japan.
Whilst these policies are unconventional, they provide avenues for Japan to take the lead in shaping global standards thus establishing Japan’s image as an innovator. This would be a powerful attracting force for overseas resources.
The Prize for Excellence
Globalization and Ways to Reinvigorate the Japanese Economy in the 21st Century
Mr. Manuel Jeffrey Sistoso (Philippines, age 28)
Just several years after its World War II defeat, Japan rose to become the world’s economic G2, banking largely on its domestic human resources armed with vigor and innovation, able to translate ideas into products that moved the world. But in the early 1990s, the Japanese miracle faltered and the country entered a prolonged period of stagnation. Fast-forward into the present and we see an entirely different world. Products, services and technology have evolved enormously. While the global economy continues its transformation, Japan is faced with daunting challenges that include shrinking population, stubborn deflation and stagnating economic growth. The question is: in the face of a seemingly impossible circumstance, can Japan do it again? Can it rise above the odds one more time, just like how it rose from the ashes 70 years ago?
This paper seeks to answer this question by laying down an action plan geared towards attracting global resources into Japan and trigger a reinvigoration of the Japanese economy in the 21st Century.
This action plan centers on education, research and innovation, the three pillars that support strong, resilient and vibrant economies. This action plan targets two things – attracting foreign talents and their ideas, and inculcating globalization into Japanese mindset. The former means that the best minds in the World must think of, and be welcomed in, Japan. This is particularly important because according to the World Economic Forum’s Global Competitiveness Report (WEF-GCR), Japan ranks poorly in attracting talented people from abroad. It ranks 79th, lower than many East Asian countries. The latter means making collaboration with foreign talents in the technical, scientific and financial aspects a common sight.
Hence, four practical initiatives must be done: 1) Promotion and strengthening of English-taught degree programs; 2) Reform of the Government Scholarship Program known as Monbukagakusho Scholarship; 3) Incentives for private companies to sponsor inbound foreign scholars and trainees; and 4) Promotion of a special innovation zone that provide anyone who possesses ideas with opportunities. The keyword is “ideas” that Japan is actually importing, instead of mere labor.
If these reforms are done, Japan will become a magnet for the World’s resources in the long-term, which could pave the way for its resurgence in the 21st Century. The challenges are daunting. But Japan surpassed far greater challenges before. There is no reason that it can’t do it again.
The Prize for Excellence
STEMming the tide : strategies for promoting globalisation in Japan
Ms. Shuangyu Ma (Australia, age 25)
In an increasingly interconnected world where resources can move freely across borders, Japan is rather unique in having achieved its economic success predominantly on the back on its local workforce and savings. While Japan’s historic rhetoric of isolationism and cultural uniqueness proved tenable as long it yielded economic growth, this will no longer be possible as both the population and savings are in decline. To fill the domestic void, the Government has turned its attention outwards, with ambitious calls to attract 300,000 foreign students to Japan, and double the stock of foreign capital in Japan. To support the long-term ‘promotion of globalisation within Japan’, this paper has two key points.
First, the effectiveness of current Government policies aimed at attracting foreign is limited by its decentralised nature. Instead, it will be important to develop a long-term vision that starts by focusing on a single area in which Japan has a comparative advantage. This paper proposes STEM (acronym for Science, Technology, Engineering, and Mathematics) educational institutions and companies as Japan’s comparative advantage in globalisation as (i) they are relatively open compared to other Japanese sectors and more open to change; and (ii) they can leverage their reputation overseas to attract foreign resources in a highly competitive global environment.
However, for long-term success, it will be essential to build on the existing comparative advantage with deliberate competitive advantage through the collective efforts of Government, industry and civil society. The most successful methods will need to appeal to the aspirations of foreign resources, and try to understand what they are hoping to achieve by moving overseas. This paper advocates for (i) an integrated system that supports foreign STEM students’ experience from university entrance examinations to post-study work opportunities; and (ii) a new corporate culture in STEM industries that looks outwards rather than inwards.
In the long-term, it is hoped that these changes that begin in STEM will ripple through broader Japan and create a more dynamic society where foreign resources are valued as integral parts of the economy.