• Short Summary

    The Japanese economy, thriving on low wages (by European and U.S. standards) and cheap raw?

  • Description

    The Japanese economy, thriving on low wages (by European and U.S. standards) and cheap raw materials, has since the war been feared by many countries, who constantly protested at what they considered to be Japanese 'dumping' of cheap finished products on their markets both home and abroad. Travelling Japanese politicians were referred to as 'transistor salesmen' and Japanese people as a whole were often reviled as 'economic animals' who thought of nothing (often true) but making maoncy at the expense of other developed nations.

    This picture has recently begun to dramatically change. 'Underdeveloped' nations have taken their lead from Middle East oil producers and, encouraged by the general scarcity of raw materials, have begun to chargemuch more for their steel, oil and other materials necessary to Japan for their secondary industries. Worse still, they have begun to demand that they export finished or balf-processed products instead of basic materials.

    At home Japan has suffered from a raging inflation for several years, brought to a head this year when workers demanded and got an over 31% payrise across the board -- a world record. This has drastically reduced Japan's competitiveness in the international market, to the point where the government have now predicted that it will very soon be cheaper to produce radios and other tradionally Japanese products in even the United States.

    In addition, Japan has been forced for reasons of international harmony to cut back on the import restrictions that previously strang???edat borth any attempts by foreigners to break into the Japanese home market. GATT and other direct negotiations have almost done away with the very high import tariffs that Japan previously extracted from other countries.

    The younger Japanese have also found that their new funds can buy them almost anything, including items from abroad that were previously beyond their reach. The articles they buy from abroad are at the moment bought mainly for that reason -- they are from the 'outside', have labels in English and French (very trendy) and have a great prestige value. But Foreign businessmen in Japan predict that this 'exotic' value of foreign goods will soon drop away, and imported gods will be bought (because of their relative cheapness compared to Japan-made products) by everybody in Japan -- "down-market". The Japanese invasion has reversed itself.

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    Reuters - Source to be Verified
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