Summary of Geopolitics Drives Japan’s Economy

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The confluence of regional geopolitics and disadvantageous demographics has forced Japan’s hand, compelling it to forge alliances abroad to fortify its economic preeminence in the face of an increasingly powerful China. This accessible overview by Asian expert Urs Schoettli explains why Japan – long an insular society – must now look outward to strengthen its small and medium-sized firms. getAbstract suggests this solid primer on regional issues to students of geopolitics and macroeconomics.

In this summary, you will learn

  • How demographics are reshaping Japan’s global outlook,
  • Why China poses a threat to Japan’s economic supremacy and
  • What measures Japanese companies are taking to maintain their commercial strength.
 

About the Author

Urs Schoettli is a subject matter expert with Geopolitical Intelligence Services.

 

Summary

Unfavorable demographics are upending Japan’s economy: Its population could decrease by one-third by the year 2050, obliging Japanese companies to search abroad for talent and markets. China’s economic ascent poses another threat, as it projects its geopolitical clout across Asia through its Belt and Road Initiative and its claims to the Senkaku/Diaoyu islands, currently in Japanese hands. These events are not lost on Prime Minister Shinzo Abe, who has allied with his Indian counterpart, Narendra Modi, in border clashes between China and India. China and Japan vary in their abilities to secure their supply chains. China’s naval capabilities are relatively weak; by contrast, Japan and India boast strong navies that, if combined, could offset China’s capacity. A reduced American presence in the region would push Japan to bolster its defenses, as anxiety rises over North Korea.


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