In a world turned upside down, Japan will muddle through

While the future is always unknowable, in Japan a darker uncertainty than usual hangs over the year to come. Much of the anxiety emanates from the COVID-19 pandemic, a virus that poses profound challenges to a society that privileges person-to-person connections and uses those networks to make critical distinctions between insiders and outsiders. COVID-19 has also magnified developments and accelerated trends both internal and external that work against Japan, exposing weaknesses and vulnerabilities.

The future need not be bleak, however. Japan could use this year to prepare for inevitable changes in domestic and foreign affairs and better position itself for that world. It is unlikely to do so.

End-of-year reports of a mutated version of COVID-19 that has forced governments to again close borders are a poignant reminder that a vaccine is not the end of the pandemic. Fears of a vaccine-resistant strain will persist, as will the prospect of an entirely new disease. Biological threats are now a permanent feature of the security environment and governments and societies must incorporate them into policymaking with all the resulting side effects — such as permanent real-time surveillance and monitoring of populations, with equally troubling implications for social and political order.

The COVID-19 crisis has prodded the shifting balance of power in ways that disadvantage Japan. Despite initial missteps, China has contained the virus and its economy has been the first to snap back. Beijing has burnished its image with offers of aid — money, vaccines and personal protective equipment — to afflicted countries. The United States, by contrast, has fumbled its response as its death toll skyrocketed and political divisions complicated a national vaccination campaign.

Mishandling of the COVID-19 crisis has compounded doubts about U.S. capability and competence. Combined with the departure of a president with whom Japan enjoyed unusual influence, the typical hand-wringing in Tokyo that greets a Democratic administration in Washington, and concern that the U.S. is becoming more inward looking and focused on getting its own house in order, Japanese unease is expanding as geopolitical competition intensifies.

Uncertainty quickly shades into insecurity. Chinese incursions into waters surrounding the Senkaku Islands occur daily. Beijing’s assertions of sovereignty over the South China Sea — abetted by a relentless island-building program — continue unabated. Tensions in the Taiwan Strait have been rising. North Korea has a proclivity to test new U.S. presidents. All mean that security concerns — especially questions about the U.S. commitment to Japan’s defense — are real.

The regional and global order that has allowed Japan to prosper is under assault. Revisionist powers are working to rewrite rules and restructure institutions in their favor — and to Tokyo’s disadvantage. There are doubts about allies in the effort to support the status quo. Relations with South Korea remain strained. Australia is under mounting pressure from Beijing. India remains committed to an independent foreign policy that renders it an unreliable partner. Southeast Asia seeks to remain above the geopolitical fray. And Europe is likely to prioritize trans-Atlantic ties over relations with distant Asia-Pacific nations.

If developments beyond its shores are worrisome, domestic affairs are alarming. The economy continues to stumble. After a horrific 27.8% drop in GDP — the steepest decline in the postwar era — in the second quarter of 2020 and something of a recovery, most economists anticipate the economy will shrink more than 5% in total in 2020, although a sustained third wave could prove those projections too optimistic. Most experts don’t expect a recovery to pre-pandemic levels before 2022.

Politics clouds the economic outlook. After taking office with the highest approval ratings in Japanese history, the Suga administration has suffered a double-digit decline in support and popularity. The most charitable thing to say is that it is uninspiring. The response to the COVID-19 crisis has been marked by confusion; efforts to deal with the third wave have been especially incoherent. Suga seems tone deaf and oblivious to appearances. The Abe administration’s scandals appear to have assumed a second wind. The opposition remains stunted and weak, however.

The government is divided on key issues, most significantly China policy. In one breath, China is a threat to Japan’s territorial integrity and a revisionist country that seeks hegemonic status in Asia; in the next, it is the key to Japan’s economic recovery. Those competing views have blocked the emergence of the consensus needed to articulate a new National Security Strategy, one originally planned to have been released at the end of 2020. Confidence in the nation’s leadership is waning when that confidence is needed most.

Amidst all this turbulence, Japan will muddle along. The swirl of events has strengthened the allure of the familiar, reinforcing demands for a steady, experienced hand on the tiller, even if that leader lacks vision or the personality needed to rally the nation. Consistency has assumed near talismanic status, despite the ineffectiveness of those policies. Japan’s small ‘c’ conservatism, with a near refusal to risk substantive changes, continues to dominate policy making.

Of course, changes are taking place — no society is trapped in amber. The assault on the sanctity of the hanko, the personal seal that is a prerequisite for most personal and business transactions, is long overdue. It is the first of a larger suite of potential changes that COVID-19 offers Japan, innovations that could facilitate new work and lifestyle arrangements that would better position the country to deal with headwinds that it faces. Sustained telecommuting could accelerate the digitalization that is key to a successful 21st century economy. It could promote decentralization and reverse the depopulation of the countryside. More flexible work practices would allow Japan to better incorporate women and elder workers in the economy. All these adjustments would enhance productivity. (And of course they would only begin; nothing can be completed in a year.)

In foreign policy, doubts about the U.S. could motivate Tokyo to redouble efforts to build a more sustainable and durable institutional architecture in Asia. It has done a lot in recent years, reviving the Trans-Pacific Partnership as the Comprehensive and Progressive Agreement on Trans-Pacific Partnership when the U.S. withdrew. It pushed the concept of a “Free and Open Indo-Pacific” as a framework for regional engagement along with the High-Quality Infrastructure Initiative. Tokyo could build on that foundation, seeking ways to lock the U.S. into Asia. The “easiest” way to do that — and it isn’t easy at all — is for Japan to take risks and spend political capital on initiatives that demonstrate commitment to regional order and make plain its value to Washington as a partner. A key step is restoring a floor to relations with South Korea and rebuilding that relationship.

Don’t hold your breath. These are difficult choices and there is little appetite in Japan, among either its leadership or the public, for bold moves. Rather, the focus in 2021 will be on containing COVID-19, dampening its economic impacts, and ensuring that the U.S. remains happy with Tokyo’s work on behalf of the alliance. The most grueling battles will likely be fought to ensure that the 2020 Olympic Games are held this summer. Japan will seek a return to normalcy, rather than the creation of “a new normal” that opens new vistas and opportunities. It is safe, but it is not enough.

Brad Glosserman is deputy director of and visiting professor at the Center for Rule Making Strategies at Tama University as well as senior adviser (nonresident) at Pacific Forum. He is the author of “Peak Japan: The End of Great Ambitions” (Georgetown University Press, 2019).