Fifty Years of the Shinkansen

Extract

Japan of 2014 is clearly a troubled nation — and I will remind the reader about only a few key components of its peculiar situation. The country is still rich by any global standard but its national debt is far higher than that in any other affluent country, and rising, and in 2014 its economy has been chronically close to, or actually in, a deflationary recession. Japan is still the world's third largest economy, but after decades of huge trade surpluses it is now running substantial trade deficits. The cause of these deficits goes beyond the post-Fukushima need for higher imports of oil and gas: offshoring of Japan's manufacturing has seen widespread loss of capacities and jobs, and many jobs have become part-time and temporary. Japan is still home to famous global brands (Toyota, Honda, Nikon) but performance of some of these companies has been tainted by poor quality products and corporate scandals (financial fraud by Olympus, massive recalls of Toyota cars, Takata's deficient airbags installed in millions of vehicles) and some firms that were previously pioneers of widely admired technical advances and the envy of corporate managers (Sony, Panasonic, Fujitsu) now face chronic difficulties, if they are not nearly bankrupt.