Despite the dire predictions of some pundits, Japan's economy will defy the naysayers and recover from its sluggishness within the year, Tokai University Professor Hajime Karatsu predicted Monday.
In an upbeat presentation at the Foreign Correspondents Club of Japan, Karatsu cited globalization, growth of the service sector domestically and the historical adaptability of Japanese corporations as reasons to be optimistic about the economic forecast. "During the past 10 years, Japan's industrial structure and economic structure have changed quite rapidly," he said.
Economic naysayers tend to overlook the importance of the service sector, Karatsu said, adding that the number of employees in the service industry surpassed manufacturing in 1994. The rapid globalization of industry has resulted in a situation where Japanese corporations account for more than 9 percent of U.S. exports, he said.
"Overseas production of Japanese companies has increased quite rapidly," he said, adding that last year, overseas production totaled 47 trillion yen -- more than the gross domestic product of South Korea.
In addition, seven of the top 10 corporations to receive patents in the United States last year were Japanese, and the immense amount of money poured into research and development -- 15 trillion yen, or 3 percent of gross domestic product last year -- bodes well for the Japanese economy, Karatsu said.