You will learn … Reason’s for Japan’s industrialisation Factors affecting JID JID : Japan’s Industrial Development

Japan’s Industrial Development 1. Need to Industrialise 2. Reasons for Japan’s Rapid Industrial Development 3. Japan’s Industrial Slowdown 4. Future of Japan’s Manufacturing Industry 5. Conclusion

Japan’s Industrial Development 1. Need to Industrialise Mountainous country; 13% arable land Industrialisation Creates jobs for people Factories need raw materials and energy to produce goods Japan has few natural resources Need to import large amounts of raw materials, mineral fuels and food – one reason for WWII

Japan’s Industrial Development 1. Need to Industrialise Industrialisation Pay for imports by exporting manufactured goods Manufacturing – main means of producing goods for export

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development 1945 (end of WWII) to 1973, Japan’s manufacturing sector grew rapidly 1968 : 2 nd largest industrial power after the US Largest producer of steel, ships, motorcycles and cameras

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development American Aid Korean War ( ) Government Support Initiative of Japanese Private Companies Qualities of the Japanese Good Labour-Management Relations

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development American Aid : US Occupation of Japan – US aided the recovery of Japan’s mnfg ind Gave $ and machinery Trained Japanese workers Opened US market to Japanese exports Supported Japan’s membership in OECD Opportunity to sell mnf goods to more countries

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Korean War Japanese industries supplied billions of dollars of goods to UN forces in South Korea End of war – Jap industries continued supplying materials to rebuild South Korea With this $ earned, J able to import raw materials and technology to rebuild its mnfg industry

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Government Support ECONOMIC Set up MITI in 1949 to promote JID MITI works closely with pte companies to draw up Japan’s ind policies Every few years, ind policy is changes to reflect local and global needs Govt officials analyse ec info collected from all over the world

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Government Support ECONOMIC Results of research given to pte companies to help them decide on new products to develop Govt’s aim : Japanese ind to compete successfully in int’l market

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Government Support DEFENCE 1947 Constitution : Forbids Japan to declare war on another country Thus Japan’s defence expd considerably less

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Government Support DEFENCE Money channeled to stimulate ind growth Initially gave out low-interest loans Used to rebuild factories destroyed in the war Funds to vital ind such as steel and coal ind Later, loans given to Encourage firms to use modern machinery Set up knowledge-intensive ind Carry out R&D projects

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Government Support EDUCATION Govt invested heavily in education (edn) 1947 : Edn system revised Compulsory edn extended to 9 years Special attention : Mathematics & Science Equip workforce to meet needs of mnfg ind Result : 1955 – 38% beyond sec edn 1971 : 91%

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Government Support INFRASTRUCTURE Improved transport and communications system Road & railway systems Telephone services Port facilities

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Initiative of Jap Pte Companies 1. Willingness to invest in new technology 2. Adapting to changes in world market demands 3. Overseas Investments 4. Company Rivalry 5. Co-operation Among Jap Companies

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Initiative of Jap Pte Companies 1. Willingness to invest in new technology Before WWII, Jap products were imitations of Western products After WWII, invested in R&D, product design and market research Improved on borrowed ideas to make better products Invented new products Investment in new products helped Japan survived two oil crises in the 1970s

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Initiative of Jap Pte Companies 1. Willingness to invest in new technology Turned situation around to profit from it Captured a large portion of world car market by producing fuel-efficient cars Robots : 1980 – 75,000 robots in Japan ie 75% of world robots at work on production lines Lower cost, increase productivity – successful competition

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Initiative of Jap Pte Companies 2. Adapting to changes in world market demands Jap companies : Adaptable & flexible In shipbuilding and steel industries Stiff competition from South Korea and Brazil

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Initiative of Jap Pte Companies 3. Overseas Investments Help to lower cost of production Lower costs of labour Availability of raw materials Keep prices of Jap products making them competitive

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Initiative of Jap Pte Companies 3. Overseas Investments Also help to find market for Jap products Eg setting up factories in US and China helps Jap sell their products in these densely populated areas Incentives Incentives offered makes foreign countries attractive and profitable to invest in

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Initiative of Jap Pte Companies 3. Overseas Investments Overcome trade barriers imposed by some countries Protectionism : limiting imports See p 164 Jap investments accepted because it creates jobs Transfer of skills and technology

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Initiative of Jap Pte Companies 4. Company Rivalry Key factor in Japan’s industrial success Keen competition to serve increasingly demanding consumers Resulted in rich variety of Jap manufactured goods

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Initiative of Jap Pte Companies 4. Co-operation among Japanese Companies Despite competition, they also exchange ideas and plan common strategies Eg Joint research projects In Japan, 2/3 of SMEs are sub-contractors of big companies Eg car ind – 65%-70% of parts produced by sub-con

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Initiative of Jap Pte Companies 4. Co-operation among Japanese Companies As quality of finished products depended on parts made by sub-con, big companies work closely with them Close consultation and loyalty help churn out high-quality products

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Qualities of the Japanese 1. A Thifty People 2. Positive Work Attitude

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Qualities of the Japanese 1. A Thifty People Japan – highest personal savings rate in the world Most Japs put their $ in banks With so much savings, banks could easily lend money to Jap inds for expansion projects , many inds borrowed $ to invest in new machinery and research for new products

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Qualities of the Japanese 2. Positive Work Attitude Japanese people generally hard-working Many do not take complete entitlement of leave Take pride in what they do Willing to learn new skills Identify themselves with their company, taking pride in its efficiency and products

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Qualities of the Japanese 2. Positive Work Attitude Many Japs involved in QCCs QCC : Small group of workers meeting regularly to solve problems at work Motivates workers, develops pride in work and foster team spirit Results : Many Jap products superior to competitors

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Qualities of the Japanese 2. Positive Work Attitude Improving their work cuts the time for production Jap companies often the first to introduce new products Eg correction pen and cutter knives

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Good Labour-Management Relations Being employed in a big Jap company is like being part of the family Managers listen to workers’ problems Workers made to feel as important as managers Both wear same factory uniform in some cases Company provides job security, training, medical care, housing loans, subsidised holidays and pay increases In return, workers stay committed and loyal

Japan’s Industrial Development 2.Reasons for Japan’s Rapid Industrial Development Good Labour-Management Relations Close relationship between workers’ union and the company Strikes are rare Thus few workdays are lost, productivity remains high and goods delivered on time