Many signs indicate that the recession has bottomed out and that economic activity in Japan again is on the rise. However, Japanese politicians, bureaucrats and executives realize that the hard work of ensuring long-term corporate and national prosperity has just begun, and they are rethinking, reregulating and reengineering both the government and the private sector. Research and development policies and structures, because of their key role in economic activity, are being swept up in this process.
After resisting for a few years, Japanese executives cut research outlays in the first half of the 1990s. Since then, however, private and public R&D spending has rebounded. More importantly, Tokyo and corporate Japan are shifting gears on R&D policies, moving from a reactive stance to a proactive one. As it searches for ways to regain its competitiveness, Japan once again is honing its R&D tools to increase efficiency and productivity.
NISSAN RESTRUCTURING PLAN PROVOKES
--- by Douglas Ostrom
Analysts around the world eagerly awaited the promised October 18 announcement by Nissan Motor Co., Ltd. of its turnaround strategy. They wondered exactly what the beleaguered automotive maker's new chief operating officer, Brazilian-born Carlos Ghosn, would say. Based on his cost-cutting efforts at Renault S.A., which had dispatched him to Tokyo after acquiring a controlling 36.8 percent stake in Nissan earlier this year (see JEI Report No. 12B, March 26, 1999), industry watchers expected a full-throttled reform. They were equally curious about how affected or just interested parties employees, their union, parts suppliers, dealers and the government would react to the restructuring plan.
MERGER FEVER SPREADS TO INSURANCE
--- by Jon Choy
The buzz over the October 14 merger announcement by Sumitomo Bank, Ltd. and Sakura Bank, Ltd. had just begun to subside when three major property and casualty insurers said October 19 that they also hoped to pool their businesses. Experts agree that the reorganization of Mitsui Marine & Fire Insurance Co., Ltd., Nippon Fire & Marine Insurance Co., Ltd. and Koa Fire & Marine Insurance Co., Ltd. under a single holding company by April 2002 is just the beginning of the restructuring of Japan's insurance industry, whether on the life or the nonlife side. This view was underscored by follow-up reports that Sumitomo Marine & Fire Insurance Co., Ltd. had expressed an interest in joining the deal. If it does become a four-way affair, the merger would produce a property and casualty insurer with assets that surpass those of the current leader, Tokio Marine & Fire Insurance Co., Ltd.
OBUCHI UNDER PRESSURE FROM JDA OFFICIAL'S
--- by Barbara Wanner
Only 15 days after launching a triparty government that seemed to assure him an easier time at the helm, Prime Minister Keizo Obuchi had the wind knocked out of his sails by the controversial remarks of Shingo Nishimura, parliamentary vice minister of the Japan Defense Agency, a political appointee. The unabashedly hawkish Liberal Party member jolted the political establishment and the still strongly pacifist nation by suggesting that Japan should consider arming itself with nuclear weapons.
JAPAN CHEERS NEW INDONESIAN
--- by Marc Castellano
Tokyo offered congratulations to Abdurrahman Wahid, the opposition member and Islamic cleric elected October 20 to serve as Indonesia's fourth president, and praised the decision of the Indonesian legislature the same day to formally accept East Timor's vote for independence. In a written statement, Foreign Minister Yohei Kono expressed the hope that with new leadership, stability would return to the troubled Southeast Asian nation. Whether Indonesia now can achieve a sustainable economic recovery and maintain lasting civil order remain open questions, however.