The repercussions of the dollar crisis are being felt all over the western world -- and the finger is being pointed at the Japanese yen as the currency whose revaluation would most ease the pressure on the dollar.
The repercussions of the dollar crisis are being felt all over the western world -- and the finger is being pointed at the Japanese yen as the currency whose revaluation would most ease the pressure on the dollar. the Japanese have built up an enormous surplus in their trading with the United States, approaching 2 billion dollars... but have so far been reluctant to upvalue the yen. On Friday (August 20) after the failure of the emergency meeting of the European Common Market Finance Ministers in Brussels, Reuters reports that business and banking circles in Tokyo agree that a change in the parity of the yen is inevitable The Japanese government is likely to hold the vital talks with Washington next week. A revaluation of the yen could resolve the crisis.
The strength of the Japanese yen is remarkable considering the total defeat Japan suffered in 1945. But industrious businessmen selling superior products is the simple answer. Japanese cars, electrical products and ships are synonymous with value and quality the world over. This production takes a look at the industrial strength behind the Japanese yen -- without missing the disadvantages of such a rapid industrialisation. Quick progress has brought with it some of the world's worst pollution.
SYNOPSIS: The Japanese yen in one of the world's strongest currencies. Along Kabuto-cho, centre of Japan's financial world, the problem is one of an excess of riches. Japanese traders have built up an embarrassing surplus of foreign exchange. World pressure is now on Japan to revalued the yen upwards, by something around 10 per cent. From almost complete destruction in 1945, Japan has built itself up into the third biggest industrial power in the world.
Japanese industry is fast overtaking the Soviet Union, and has set its sights on replacing the United States as world number one. The New Japan Steel company has replaced US steel as the world's biggest. The time is well past when Japan could claim the special allowances of a country in the early stages of industrialisation.
For years the Japanese have led the world in shipbuilding. They launched over ten million tons last year.... that's as much as the rest of the world put together.
Japan has virtually cornered the world transistor market... Japanese camerae are now as world-renowned as the Germans.
Watches made in Japan are providing stiff competition for the traditional Swiss-dominated industry.
Japanese car exports are making themselves felt in the world, especially in the lucrative American market. Japan had become America's biggest overseas trading partner. It's a two-way business involving more than 12 billion dollars a year. Until a few years ago the balance favoured the United States. But this year Japan will sell 2 billion dollars more than it buys from America. It's a drastic drain on the dollar... and it's accused of being at the root of the current dollar crisis.
The Japanese are aggressive businessmen. Their salesmen cover the globs, exploiting markets, and finding new ones with a determination that borders on the fanatical. Gut American businessmen complain that while the Japanese expand overseas, they firmly protect their home market form foreign competition. They do it by height tariffs, quota restrictions, non-tariff tads barriers, all simply by shutting out foreign industries. There are many theories to explain Japan's phenomenal economic success. One reason certainly is the high quality of its management personnel. Also the industriousness and patience of the labour force. The Japanese government also gives considerable aid to private business. The whole machine has been referred to as "Japan incorporated."
But the Japanese have their problems. Japan has almost no natural resources. Any one day there's no more than a 25-day supply of oil on hand to keen great Japanese machine churning. Japan has also paid for its rapid industrialisation. Pollution is bad. Traffic congestion, bad air, polluted lakes, rivers, coastlines. But despite the cost, the Japanese economy continues to expand, last year around 10 per cent in real terms. But one result has been an imbalance in world trade. one again the world financial boat has been rocked... President Nixon has effectively floated the dollar... and called on Japan to revalue the yen.