The Post War Economic Growth

1. The Post War Economic Growth

2. US occupation and post war Reconstruction -Japan was under the command of SCAP [McArthur] -joint force set up the Far Eastern Commission in Washington and convey the Decisions through the US government to The SCAP

3. Political Reforms: • Demilitarization and democratization • -militarists (Tojo Hideki) were tried & • The right wing organizations were disbanded. • -Shintoism was denationalized. • “renunciation of divinity” of emperor • Freedom to people • Labour organizations & liberalism in • education

4. 2. The proclamation of new constitution -”Showa Constitution” -reduced the power of the emperor- Symbolic emperor -guaranteed the sovereignty of people- Human rights and equality before the law

5. -promoted the Diet centrism-key legislative Body –House of Representatives & Senate- Cabinet held the administrative rights- Prime minister was nominated by Diet and Elected by Diet’s members.

6. Economic Reforms: • The dissolution of Zaibatsu 1945 • -only 4 major financial groups survived • & other small medium sized zaibatsu • Were dissolved. • -established free competition between the • Enterprises • -financial groups still monopolized • Banking business enterprises.

7. 2. Agricultural Reform 1946 -most successful -”Owner Farmers Establishment Special Measurement Law” abolished the ownership Of landlords. -Purchase of the farmlands owned by Absentee landlords or those exceeded the Reserved land under legal protection. -price of land was close to 0.

8. -contributed to land opening up for farming. 3. Labour reform -encouraged the Labour movements, Modern employer-employee relationship, Systematic employment system,etc.

9. Factors for economic growth since 1945: Internal Factors

10. SCAP Period (1945-52) 1. Favourable SCAP policies -new constitution -agricultural reforms -anti-monopoly policies -stabilizing Japan’s economy -education policy -birth control policy

11. 2. Favourable effects of the Cold War -from punishment to assistance -special procurement of the Korean War

12. 3. Special relationship between US • And Japan • Arranging the signing of San Francisco • Treaty • Assisting Japan’s industrial development • Reducing Japan’s military expenses

13. 4. Policies of the Japanese Government • Emphasis on education • Emphasis on economic development • Implementation of economic plans • establishment of legal and management • System • support to small to medium companies- • Government give startup support to them • -

14. 5. Customs and habits of the Japanese -willingness to acquire new knowledge -obedience and sacrifices -savings and investments -japanese style of management

15. 6.Cooperation between employers and Employees -New “family run” business -life time employment system -seniority based wage system -enterprise union-one union for one Enterprise -“Japanese employer-employee relationship” [rules]

16. 7. Provision of stable business environment -Liberal Democratic Party (LDP) held Many seats and became the ruling party. -regardless of factions within the party, They had fundamental beliefs, viewpoints, Standpoints and policiesconsistency -most were private enterprisesstable Amid political changes.

17. External Factors • International Instability • -Cold War: US shifted the policy of • Weakening Japan to putting Japan as • Defense against communism in E. Asia. • -Korean War 1953: Japan provided • War supplies to the US –industries bloomed

18. 2. The signing of the San Francisco Peace Treaty 1951 -ended US occupation and Restored Japan independence. -attracted capital and techniques from Europe and N. America—economy Bloomed.

19. 3. Favourable international circumstances -Japan importer of food and raw materials exporter of industrial products -Procurement of the Vietnam War

20. Post War Economic Development

21. Economic reconstruction and Recovery 1945-52 -experienced crop failure til 1947 -due to Cold War, the US stabilized Japan’s economy and political situation. -Dodge as economic advisor –Nine Economic Principles-implementation of a Single currency, establishment of a Balanced budget, importation of American Supplies for revenue to build Japan

22. Economic growth 1952-64 • “The first economic peak” 1955-57 • -investment of fiscal funds and bank loans • On special needs, e.g. electricity, shipping • -five year plan for electricity-petroleum • (from crude oil) was on demand- oil refining • industry bloomed. • -more independent and active economy • “Jinmu”boom.

23. 2. The second economic peak 1958-64 • -mass production of car and other home • Appliances • “Iwato Boom” • Olympic Games held in Tokyo in 1962.

24. Continuous development and Instability 1965-79 3. The third economic peak 1965-70 -heavy and chemical industries -”Izanagi boom”-catch up with Europe And US.

25. 4. The period of transformation 1971-79 -slowed down due to environmental pollution, International sentiment against Japanese Export, conflict between the US and Europe, International oil crisis 1973. -needed to reform industrial structure

26. 5. Economic slowdown 1980s and Recession 1990s -1980 internationalization-conflict with International economy -1990 economic bubble burst-political corruption

27. Japanese Economic, Cultural and Political Relations with Other Asian Countries

28. Post War Diplomatic Policies -to view the United Nations as the centre -to collaborate with liberal states -to uphold the idea of “a member of Asia”

29. 1950-60s-following US foreign Policy 1970s-regaining diplomatic Independence 1980 and after-becoming a great power in Asia

30. 1950-60s-following US foreign • policy [LK] • Establishing diplomatic relations with • South Korea • 2.limiting contact with PRC • 3. Developing pure economic relations • With Southeast Asian countries • -why?

31. Japan had lost Chinese market, she • Needed to find a replacement. • b. Rich resources from SE Asian to develop • The chemical industries and SE Asian • Countries were economic partners.

32. 1970s-regaining diplomatic • Independence • Background: • By 1970, Became 2nd largest • Economic power after USA. • 2. USA setback in Vietnam • Japan wanted to fill up vacuum.

33. Establishing diplomatic relations with • PRC • 2. Strengthening relations with Southeast • Asian countries-only limited to economic • Aspect. • Why be friendly with SEAsia? • -raw material, e.g. tin • -investment opportunity • -oil crisis 1973 • -ocean in SEAsia important to Japan • Sea transport

34. “Fukuda Doctrine” in 1977 • ASEAN

35. 1980 and after-becoming a great power in Asia “Nakasone Yasuhiro’s foreign policy” -increased diplomatic activities -exceeded military expenditure -export Japanese culture and tradition to Other parts

36. Nakasone’s “four principles for Asia- • Pacific cooperation”(ED.) • To respect the spirit of ASEAN • To promote the spirit of non- • Governmental organizations to collaborate • In a leading role with NGO. • 3. To confine the cooperative scope • Into economic, cultural [exclude military] • 4. To establish an open collaborative system

37. 1980 and after-becoming a great power in Asia 1.improving relation with South Korea 2. Strengthening economic relations with PRC 3. Taking part in political and economic Affairs of Southeast Asia 4. Spread of Japanese popular culture

38. Relations between Japan and other South Asian countries (ED.)

39. -1950s, peace treaties with India and Pakistan -1984, prime minister visited India & Pakistan -1990, Japan proposed “three directions” For development of Japanese relations With the South Asian countries.

40. Provide aid to maintain stability and • Peace. • 2. Expand and strengthen economic cooperation. • 3. Enlarge the scope of cultural interflow • [preserve cultural heritage]

41. Unfavourable factors for Japan to • improve her relations with other • countries: • Denials of aggression and falsification of • History books • 2. Official visits to Yasukuni Shrine

42. 3. Denials of Asian people’s quest for war Compensation 4. Territorial disputes with other Asian Countries END