NO. 15 -- April 18, 1997


Feature Article


An Interview With Naohiro Yashiro Of Sophia University

The demographic changes that have occurred in Japan in this century are unprecedented to some extent. With a falling birthrate, the country's natural population growth has dropped significantly compared with several generations ago. Given current conditions, sometime in the next century Japan's population may enter the stage of long-term decline. This prospect suggests that the labor force will contract in the years to come absent higher participation rates among women of all ages and older men. A smaller pool of workers would have far-reaching consequences for Japan, especially in the economic sphere but also for society. Naohiro Yashiro of Tokyo's Sophia University, a well-known and highly regarded expert on labor market conditions in Japan and the economic effects of aging, recently discussed some of these policy ramifications with Senior Political Analyst Barbara Wanner.

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Weekly Review

Top U.S. Defense Officials Rule Out Troop Cuts, Urge Expanded Cooperation by Barbara Wanner

During back-to-back mid-April trips to Japan Secretary of Defense William Cohen and General John Shalikashvili, chairman of the Joint Chiefs of Staff, continued to set the stage for the April 25 summit in Washington between President Clinton and Prime Minister Ryutaro Hashimoto. That meeting will focus on the importance of U.S.-Japan security ties in maintaining stability in Asia. Reiterating many of the points made by Vice President Al Gore and Secretary of State Madeleine K. Albright during earlier visits to Tokyo, Messrs. Cohen and Shalikashvili emphasized that the United States will continue to base in Japan 47,000 of the 100,000 U.S. troops deployed in Asia. Moreover, this staffing level will remain unchanged for the foreseeable future in view of post-Cold War regional uncertainties, both officials told their counterparts, Japan Defense Agency Director General Fumio Kyuma and General Shigeru Sugiyama, chairman of the Self-Defense Forces Joint Staff Council.


Japan's Foreign Aid Plummeted In 1996 by Christopher B. Johnstone

In a sign that the pillar of Japan's foreign policy may be beginning to crumble, Tokyo announced April 7 that net outlays of official development assistance last year tumbled 35 percent in dollar terms to $9.6 billion. This provisional figure includes aid extended to countries in Eastern Europe that formally do not qualify for ODA under international guidelines. The final figure for Japan's 1996 development assistance therefore likely will be around $9.4 billion. Although officials in Tokyo long have expressed concern that a weakening yen could create the appearance of a smaller aid budget, exchange rate changes do not explain all of last year's decline. In yen terms ODA outlays fell nearly 25 percent. Other factors affecting net disbursements included a large increase in repayments of previously extended yen-denominated loans and a sharp, although temporary, drop-off in contributions to international organizations.


JFTC, MOF Encourage New Kinds Of Linkups by Douglas Ostrom

To many people the term "competition policy" typically conjures up notions of bureaucrats, tipped off regarding the secret conversations of corporate executives conspiring to fix prices, throwing the book at miscreants. An even more activist competition policy -- one that vetoes mergers or requires the spin-off of certain operations before a combination is approved -- seeks to prevent the concentration of economic power in a few large firms. Such power is thought to facilitate collusion or even render it unnecessary in the case of a monopoly. Although the United States and Japan have similar laws regarding both kinds of competition policy, authorities in the two countries interpret each one differently. That was evidenced by early April events involving mergers and industrial restructuring.


Last-Minute Deal Postpones Port Practices Penalty by Jon Choy

Only three days before the Federal Maritime Commission was prepared to impose stiff sanctions on cargo carriers owned by a trio of Japanese shipping lines calling at American ports to protest Japanese harbor practices, negotiators for the United States and Japan struck a deal that holds out the promise of significant reforms. The April 11 Memorandum of Consultation they signed in Washington lists the areas of American concern and general ways in which Tokyo will modify current port practices. To keep the pressure on Japan yet give the Ministry of Transport time to work out and effect the expected changes, the FMC decided to postpone its planned penalties until September 4; however, progress reports are required July 1 and August 5. Thus, while a tit-for-tat sanctions fight has been avoided for the moment, a resolution of the issues has not yet been achieved.



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