KARUIZAWA, Nagano Pref. — Business leaders exchanged opinions July 17 on Japan’s international economic relations and the role of the private sector in the ongoing structural reforms at the 12th summer seminar of the Japan Association of Corporate Executives (Keizai Doyukai).
“It is improper that the current reforms lack reform of the tax system. Tax reforms should not be considered as a measure to stimulate the economy when the economy goes down,” said Yasuo Kanzaki, an adviser at Nikko Research Center.
Saying that public support for the ongoing reforms is strong, Kazuaki Harada, director of Sanwa Research Center, said that the country has the option of skipping such measures as tax cuts and public work projects to boost the economy. But Yoshikazu Hanawa, president of Nissan Motor Co., questioned the effectiveness of the ongoing reforms, which have run into strong opposition from the nation’s bureaucracy.
In response, Harumi Sakamoto, vice president of Seiyu Ltd., said that because bureaucrats tend to adhere to public opinion, they are likely to react swiftly if the public supports reform. In the session on Japan’s relations in international economics, Hanawa raised the question of whether Japan’s direct investment in other countries really benefits Japanese firms.
“Since we have created (manufacturing) bases abroad, we have not made sufficient profits,” he said. “When we invest vast amounts of money abroad we are taking big risks, but profits are not expanding.”
Hanawa also cast doubt on whether the Chinese market will become a potential one for non-Chinese countries, citing as an example Japan, which has protected its market from other countries. Hiroshi Araki, president of Tokyo Electric Power Co., voiced concern about the Americanization that has been taking place since the end of the Cold War in such important areas as the computer industry. “Should we follow this trend or create our own specifications?” he asked.
Another participant pointed out that although Japan is able to develop technology, it does not have sufficient knowhow to make its technology a de facto global standard.