(MENAFN- Asia Times) TOKYO - The next blow to the collective Japanese psyche will be falling behind Germany to become the fourth-biggest economy. Yet, 12 years on, Tokyo is still grappling with having watched China surpass it in gross domestic product terms.
It was in 2010 and 2011 that banner headlines proclaimed the changing of the guard, when the economic student amassed greater power than the teacher. China , like South Korea, Taiwan, Thailand and other Asian“tigers,” cribbed from parts of Japan's development model.
Why, then, is Japan's fiercely proud political establishment making it so easy for China to continue to throttle forward?
Many Japan pundits disagree with the terms of this debate vehemently. The force is strong with the conventional wisdom, which is that GDP matters far less than per capita income – a metric on which Japan blows the doors off China.
And, clearly, Chinese leader Xi Jinping has shot his economy in the foot enough times to slow progress. From disruptive crackdowns on tech to draconian Covid lockdowns, Xi has generated more headwinds than tailwinds since 2020.
Yet many global investors and academics can't help but wonder what, oh what, Japanese Prime Minister Fumio Kishida's Liberal Democratic Party is up to as Asia's economic clock speeds up and China raises its game.
In 2013, the LDP returned to power with a bold plan to get Japan's economic groove back. At the time, Prime Minister Shinzo Abe made unveiled references to reminding China whose continent Asia is.
Sadly, his pledges – to reduce bureaucracy, increase innovation and productivity, liberalize labor markets, incentivize a startup boom, empower women, attract more foreign talent and give Shanghai a run for its money as Asia's financial center – fell by the wayside.
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