Japan

Is PM Abe’s at risk of a health relapse with yet more voter backlash?

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Yet more voter backlash for PM Shinzo Abe and the LDP. The scandals and shenanigans are causing some glaring results at the local and prefectural level. Last month’s Tokyo Municipal Assembly elections saw the LDP experience its worst ever outcome. The Sendai Gubernatorial elections this Sunday saw the LDP stench continue. Japan has been pushing the Abenomics revival theme but given the stress from a plummeting approval rating (26% heading into the Kake Gakuen hearings in parliament) will his health issues kick up forcing him to resign? The July 22-23 Mainichi newspaper poll showed that 56% did not back his government, +12 points from the previous survey in June.

Independent candidate Kazuko Kori (right) promised education reform and a quick resolution to the problem of long child care waiting lists. Her LDP competition in the form of  Hironori Sugawara (left),ironically a president of a funeral services operator, was defeated.

PM Abe’s left his first term after just 12 months in 2006-2007 being diagnosed with an illness known as chronic ulcerative colitis — a type of inflammatory bowel disease which according to the Bungei Shunju monthly magazine in Feb 2008:

“He would rush to the toilet in pain…he felt the urge to evacuate every half hour or so.

While in the 2012 campaign Abe assured us he’d been cured, the question is whether the current crop of scandals (involving him and his wife Akie) will see a relapse of this condition, rendering him out of action. Markets are not yet forecasting Abe to resign but whatever one thinks about “Abenomics” it has brought some long overdue semblance of stability in Japanese politics. Should an event occur we could see some financial evacuations.

Death from overwork on the Tokyo Olympic Stadium

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After the first stadium was rejected for its exorbitant cost, the ‘budget’ conscious stadium started 14 months later than anticipated. Due to the delay, work on the new stadium has caused another scandal – excessive overtime. One worker has taken his life after logs showing he had worked over 211hrs of overtime in a month. One shift saw the worker start at 6:30am and finish up 26 hours later. One wonders what will turn it? If Tokyo Governor Yuriko Koike offers a glib apology what hope is there of reform? The punishment for Dentsu (who saw a worker commit suicide) was it wasn’t allowed to apply for any Tokyo government ad contracts for one month.

While the advent of Premium Friday (workers can knock off at 3pm on the last Friday of each month) is a positive step forward and having employees clock on & off makes sense, there is a deep seated cultural problem of not wanting to become an outcast within a company. Although the The Japan Institute of Labour Policy & Training reports that since 2002 bullying and harassment claims to the Labor Tribunal have soared from under 6% to over 20% at the same time total disputes have trebled to over 300,000 annually. One worker from Olympus complained his bosses were being unethical by poaching many of a contractors staff. His punishment was demotion among other humiliation. In order to avoid being unfairly treated, people are using the ‘-hara’ (pawa-hara = power harassment, seku-hara = sexual harassment, mata-hara = maternity harassment) route to their advantage as the following charts show.

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For corporates in Japan, the government is the leader. It took PM Koizumi some 15 years ago to introduce the ‘Cool Biz’ concept (removal of neckties in the middle of sweltering summer during a period of power conservation) because corporations didn’t want to risk being the odd one out.

However there are exceptions. One company in Japan has a very open approach to hiring and paying its staff top rates that are based on performance. Staff are willing to work long hours because inputs have transparent outputs. Instead of getting one or two months pay twice a year like many Japanese corporates offer no matter how ordinary the real performance is this company has employees who think, according to one, “like working in heaven.” Simple – they are paid for their abilities and the trappings of that success are indeed visible.

BBC Radio interview on Japanese crime

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Please find the link to the radio interview with BBC World Service here. I’m wondering whether there is more merit nowadays to vlogging or audio given the small propensity to read. The hardest thing is to accept is the sound of one’s voice on tape! What I wasn’t aware of is another person interviewed was my former colleague I sat next to in Tokyo 18 years ago…small world.

Crime in Japan – BBC interview 7 July

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Tomorrow, BBC World Service’s Edwin Lane will release the pre-recorded interview he conducted with me several months ago on the back of a series I wrote on Crime in Japan – Part 1 – Geriatric Jailbirds, Part 2 – Breakdown of the nuclear family and Part 3 – Fraud, Drugs, Murder, Yakuza and the Police some 15 months ago. Since then the reports have been reported in 14 different languages and reached c.5 million page/podcast impressions as the BBC also conducted an interview on BBC Radio 5 “Up all night”

The reason I ended up writing the research paper came by chance. While trawling through the Japanese National Police Agency statistics looking for data to help a client on motorcycle license trends, I stumbled over the crime stats and couldn’t believe the wealth of information that showed the sharp jumps in crime levels. There is some suggestion that much under-reporting went on several decades ago but as you can see in the reports the charts speak for themselves.

On a global basis, Japanese crime is low on almost any measure but the Ministry of Justice (MoJ) has had to expand prison capacity 50% in the last decade, facilitated early release to prepare for a sharp rise in elderly inmates. The pension-age cohort in prison now represents the highest percentage of total inmates. With that the MoJ has had to apply for a supplemental budget to cover the extra cost of healthcare in prison as the average age rises.

 

The sorry tale of US auto makers in Japan

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It isn’t new news. American leaders have often complained at the Japanese for not buying more American cars. The sad reality is that most American cars are totally unsuited to the narrow streets in the land of the rising sun. Last year, Chrysler sold 240 cars, Cadillac 585 and Chevy 593. Jeep, to its credit sold a compact SUV into Japan and sold 9,745 cars. Toyota sold 2.45mn cars in the US last year. Nissan 1.56mn and Honda 1.64mn. What is the best selling US brand in Japan? Harley Davidson – it imported 10,766 bikes last year approximately half the total of foreign imported motorcycles sold in Japan in 2016 above 251cc.

We shouldn’t forget that Ford pulled out of Japan several years back as the low volumes couldn’t justify it. Don’t think that the Japanese hate imported cars:

Mercedes-Benz was Japan’s No.1 import brand selling 67,386 units, BMW at 50,571 and Volkswagen at 47,234. By model, the top-selling import in 2016 was BMW’s Mini with 24,548 units. Volkswagen’s Golf at 22,802 deliveries, followed by the Mercedes-Benz C-Class (17,760); BMW 3-Series (11,947) and VW Polo (10,903). Surprise surprise- all at the lower end of the size spectrum.

 

Rebels too old for a cause

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The average age of motorcyclists in Japan is 53 years old and continuing to climb as younger riders looking to obtain new licenses continues to drift. Between 2010 and 2016 the Japanese National Police Agency (JNPA) noted that large capacity motorcycle license holders (ogata – classified as 400cc+) have fallen by nearly 1,500,000. While mid-size (chugata – classified as below 400cc) have risen around 715,000. Female riders have shown a similar pattern of 178,000 fall in ogata licenses and 147,000 increase in chugata respectively. While there are still 9.175mn men and 625,000 women willing to get out on the highway with large capacity bikes, the trend is alarming. More frighteningly, new graduates aren’t lining up either. 30,000 fewer students lined up to get a mid or large size bike license between 2014 and 2016 representing a 12.3% dip. Latest report found here Motorcycles in Japan – Analogica KK

Financial planning when you’re 100 years old

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Nomura Securities popped a leaflet in the post scouting for people to attend investment seminars.  What caught my interest was a seminar for those genki 100 year olds who need to plan for the future. While Japan has the highest longevity of anywhere I wonder if these centenarians have seen more cycles, crises and financial meltdowns than the 23yo freshman sales guy at Nomura combined!