The Journal The Authority on Global Business in Japan

Prime Minister’s Office

Concerns over Trump protectionism

With the victory by Republican candidate Donald Trump in the November 8 US presidential election, the future of the world’s economy has become less transparent. Concerns have increased that, should protectionism emerge, the volume of foreign trade will decline. This would adversely affect economic growth for Japan and the world. A certain unnamed think tank announced that Japan’s GDP might fall by more than 1 percent. On November 14, the Prime Minister’s Office announced that positive GDP growth was achieved in the July–September quarter, the third consecutive quarter in which growth was realized. Domestic demand, such as investments in factory equipment, etc., remained weak. With Trump’s victory and the resultant higher risk to the world economy, the government is likely to seek structural reforms or high wages to boost consumption and buttress domestic demand.

To protect employment and industry in his own country, Trump has advocated that the United States disengage from the Trans-Pacific Partnership, saying he would make an announcement to that effect “on the day I take the oath of office.” Products from countries with large exports to the US, including Japan, Mexico, and China, may see an increase in duties on their goods.

The Japanese industries most likely to be hit hard are automotive, electric machinery, and related exports. In 2015, US imports of manufactured products accounted for about 13 percent of total world trade on a value basis, making the United States the world’s top buyer.

The research arm of Daiwa Securities noted in a report that if protectionist actions are taken by Trump, it would have the same—if not greater—effect than the Lehman Shock of 2008, which saw Japan’s GDP fall 1.12 percent. This resulted in declining stock prices, appreciation of the Japanese yen, and deceleration of economic growth worldwide.

Following the government announcement of GDP performance, Economic Revitalization Minister Nobuteru Ishihara emphasized at a press conference that “Japan must advance innovation and structural reforms” through such measures as “revolutionizing work methods to improve productivity.” Ishihara said he will seek greater efforts between the bureaucracy and private sector to push growth.

Ministry of Internal Affairs and Communications

Ministry objects to NHK fee plans

In anticipation of starting service in the near future, NHK is currently testing round-the-clock distribution of programs via the Internet. The question of service fees has resulted in a “spitting contest” [sic] between NHK and the Ministry of Internal Affairs and Communications.

Public interest in the new service is said to be high. In a regularly scheduled press conference on November 9, NHK Chairman Katsuto Momii began by telling reporters, “We will set up a pricing system on our own.” But following a cabinet meeting held two days later, Internal Affairs and Communications Minister Sanae Takaichi threw cold water on Momii’s remarks, saying, “The Ministry will determine the specifics of the system’s design following deliberations by a panel of experts.”

Momii raised the issue that “Funding might be needed to distribute programming simultaneously as TV broadcasts, and we have incorporated estimates into our funding plans.” In other words, NHK intends to determine its future fee structure on its own, splicing its Internet contents with the fee it currently charges subscribers.

One reason the ministry is concerned with the new Internet service is that, with added revenues from viewers, NHK will become “bloated.” The group of expert consultants is in agreement with the ministry that data distribution and management will require expanded supervision. The experts have been debating three main themes: changes in the broadcasting law to recognize simultaneous Internet distribution; a revised system for charging fees for Internet distribution; and reinforcing governance of NHK.

Takaichi was quoted as saying, “Nothing has been decided, such as if simultaneous distribution will be conducted on a 24-hour basis. Nor has it been decided who will bear the related costs of the service.

“We will continue to discuss the three themes until we can come up with a satisfactory system,” she emphasized.

From this, it’s clear that the ministry is choreographing the plans, engaging in deep design and forethought by adopting a carrot-and-stick approach that will offer NHK simultaneous netcasting while engaging in tighter supervision.