Invest in ‘human capital’

Dear Prime Minister Aso,

In this era of unprecedented economic turmoil, I urge you to invest in the “human capital” needed to maintain Japan’s position as an economic superpower in the 21st century.

Having lived in Japan for nine years and worked closely with Japan’s best and brightest young professionals for more than 14 years, I can tell you that Japan’s greatest resource is its people. Unfortunately, this resource is dwindling as Japan’s population rapidly ages, and its birthrate has fallen well below replacement level.

What is even more alarming is the fact that admission standards at Japanese universities are loosening because of the declining number of young people. In contrast, while the competition for admission to universities in Japan cools off, it has heated up at universities overseas. For example, current economic woes and a weak job market have caused a surge in applications to business schools in the U.S. and EU. These circumstances threaten to place young Japanese at a distinct disadvantage in the global arena in the years ahead.

To counteract this downward slide, I suggest you take advantage of the strong yen by providing government scholarships and low-interest student loans to increase the number of Japanese studying abroad. In particular, I urge you to assist Japanese postgraduate students, because they are the individuals likely to add the most value to Japan’s economy and society in the future. You might even consider the provision of additional financial incentives to married Japanese postgraduate students with children, or those who give birth to a child overseas, in order to boost Japan’s birthrate. Furthermore, I encourage you to offer tax breaks to corporations that sponsor employees to study abroad because, in doing so, these companies are significantly contributing to Japan’s “human capital.”

To measure the value of studying abroad, we should consider the accomplishments of a few former Japanese postgraduate students. Of course, everybody knows about “Mr. Strategy,” Kenichi Ohmae, who earned a doctorate in nuclear engineering from MIT and then went on to become Japan’s leading management guru. And then there’s Masatoshi Koshiba, a Ph.D. from the University of Rochester who won the Nobel Prize in Physics in 2002 for his pioneering contributions to astrophysics. More recently, we have Hiroshi Mikitani, a Harvard MBA graduate who established the online shopping mall Rakuten and became Japan’s leading Internet entrepreneur. These extraordinary people are an inspiration to young men and women not just in Japan, but worldwide.

In his book on studying abroad, “The First Time Effect,” Joshua S. McKeown, director of international education and programs at the State University of New York at Oswego, goes beyond acknowledging the cultural and linguistic benefits of living and learning overseas to focus on how it stimulates intellectual growth among international students. He asserts that some of them, particularly those students who have not yet lived or studied overseas, experience significant gains in intellectual development from their study-abroad experiences. Young Japanese would definitely benefit from such stimulus.

In this day and age, lifetime employment is no longer feasible, so the future of young Japanese is no longer decided at age 18. Studying abroad can dramatically alter a person’s potential and possibilities. Personally, I believe that a new generation of Japanese entrepreneurs will add the greatest value to Japan’s economy and society, but students studying abroad in any field have the potential to make important contributions to the nation.

To build the foundation of a brighter future, you must prepare Japan’s young generation to actively engage in shaping the new global economic order that is now emerging by promoting and generously supporting study-abroad programs. Doing so at this time would be one of the best investments that you could make in the future of Japan.

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