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The ‘Iron Lady’ and Japan

by Hugh Cortazzi

Admire her or loathe her, no one can deny that Margaret Thatcher, who died April 8, was a political phenomenon. She was the United Kingdom’s first woman prime minister and kept the post for over 10 years. Under her leadership Britain was radically — and likely permanently — changed. Thatcher took on the trade unions, which had been causing frequent stoppages, and she ensured that nationalized industries were privatized to improve efficiency. She also took measures to increase competition and to remove bureaucratic restrictions.

The economy improved as a result, but there were losers as well as winners. Miners in particular suffered as the industry declined, but the decline was inevitable. The manufacturing industry also had a hard time while service industries, especially finance, boomed. The “light touch” regulation that she favored was one reason why British banking faced such a crisis in 2008.

Some of the changes she engineered had a significant impact on other countries. She made the mistake of opposing German unification after the fall of the Berlin Wall and her confrontational tactics with European Union countries exacerbated Britain’s relation with Europe.

Thatcher and the measures she espoused had significant implications for Japan. Members of the Japanese establishment were overawed by her. When I was ambassador I heard one or two mutter about “that woman” (ano onna). They did not expect to see any Japanese woman like her, nor did they want to.

In the early 1980s Japanese used to deplore what they termed the “English disease” (Eikokubyo) by which they meant Britain’s strike-ridden economy and class society. I argued as hard as I could that their picture of Britain was exaggerated and distorted, but until Thatcher’s policies began to take effect it was an uphill task.

Her no-nonsense and plain speaking did not conform to the euphemisms and circumlocutions so frequent in Japanese and it took time for Japanese politicians and businessmen to accustom themselves to her ways. Thatcher, moreover, did not believe in consensus building so important in Japan. She thought that the confrontational style of British politics was the best way of running a democracy. Not all British agreed with her.

Thatcher was a realist and a trained scientist. She recognized Japan’s economic strengths and Japan’s technological and scientific achievements, and she saw that it served both British and Japanese interests to promote Japanese investment in Britain. As ambassador I saw the encouragement of Japanese manufacturing investment in Britain as one of my prime tasks and as perhaps the only effective way of mitigating Anglo-Japanese trade friction. Thatcher gave her personal backing to this campaign.

When she came on an official visit to Japan in the autumn of 1982 we arranged for her to meet the heads of major Japanese companies. It may not be correct to say that she charmed them, but she certainly impressed them. Akio Morita of Sony, who had taken the initiative by investing in South Wales, was one of her admirers.

She recognized, however, that the key to the expansion of Japanese investment in Britain was to persuade Nissan to invest in Sunderland. Nissan proved hard to get and it required Thatcher’s personal intervention and commitment to bring Nissan to make the necessary decisions. Nissan’s investment was followed by Toyota deciding to invest in Derbyshire and Honda to expand its investment at Swindon. These investments have transformed and revived the British car industry. British industry has learned valuable lessons from Japanese techniques and quality control.

Thatcher was at heart a free trader and was highly critical of the mercantilist and protectionist policies adopted by Japan’s Ministry of International Trade and Industry in the early 1980s. But she was also sensitive to the complaints of British manufacturers that faced competition from Japanese companies, which was described by them as “concentrated and torrential.”

I shall never forget one fraught late night argument in Tokyo in 1982 with her about trade policy. We officials argued with her that in her talks with Japanese ministers she should stick to our commitments under the GATT and eschew the more protectionist policies then adopted by the French and Italians in relation to imports from Japan. I went to bed thinking that I was on my way out having argued, I feared unsuccessfully, with her. In fact she was, I suspect, just trying us out. She had no intention of adopting protectionist policies and she pressed hard for Japanese liberalization of imports without invoking the safeguard clause against imports in the revised Anglo-Japanese Treaty of Commerce of 1964.

But she did not find Zenko Suzuki at all impressive and preferred other more intelligent and internationalist Japanese politicians such as Yasuhiro Nakasone, Takeo Fukuda and Kiichi Miyazawa whom she met during her years as prime minister.

She was not impressed by the unhelpful attitude of the Japanese government over the British campaign to expel the Argentine invaders from the Falkland Islands. Her personal message to Suzuki received a weasel-worded response. It seemed to her and to me as ambassador that the Japanese government regarded possible implications for Japanese trade with Argentina and South America generally as more important than the principle that territorial issues should not be solved by aggression. The Foreign Ministry failed to see that its refusal to support these principles had implications for territorial issues involving Japan.

Thatcher was a role model for Japanese women and her combination of talents as a politician and scientist has undoubtedly had an important impact on Japanese attitudes. She deserves to be remembered in Japan with admiration.

Hugh Cortazzi served as Britain’s ambassador to Japan from 1980-1984.