CHOWA
Newsletter of the Japan Society
Canada’s pre-eminent association enhancing Canada-Japan relations
Number 13, Summer 1998
The Importance of Maintaining Strong Canada-Japan Trade Relations
The Honourable Sergio Marchi, Minister for International Trade, (left) with His Excellency Takashi Tajima, Japanese Ambassador to Canada, and Founding Chairman of The Japan Society, Hartland M. MacDougall, C.V.O., O.C.
Notes for an Address by The Honourable Sergio Marchi, Minister for International Trade
The Japan Society Toronto, Ontario June 5, 1998
I would Like to thank the Toronto Japanese Association of Commerce and Industry, and The Japan Society, for hosting this wonderful luncheon.
I was reminded recently that in 1929, just two years after receiving the right to establish diplomatic relations with other countries, Canada proceeded to establish diplomatic relations with two countries that it considered to be of great importance: France and Japan.
The Honourable Sergio Marchi, Minister for International Trade, (left) with His Excellency Takashi Tajima, Japanese Ambassador to Canada, and Founding Chairman of The Japan Society, Hartland M. MacDougall, C.V.O., O.C.
Nearly 70 years later, I stand before you to reaffirm the importance that we attach to our relationship with Japan, and to declare, in no uncertain terms, that we intend to remain fast friends and firm allies for the next 70 years as well!
Your organizations have always played an important role - in furthering economic relations, enhancing cultural understanding, and supporting business and educational exchanges between Japan and Canada.
But your role is even more vital now, when the present financial difficulties in Asia cause some to question our commitment to this region, or to suggest that our interests and efforts should be directed elsewhere.
At such times, your in-depth knowledge and your long-term perspective become essential, reminding us of the opportunities that await us and the underlying strengths that support them.
So I welcome this chance to meet with you today, to reassert our commitment to Japan and to developing even stronger commercial relations with it.
Let me begin with a clear statement of Canada's position: We are not a fair- weather friend. Japan is Canada's second-largest trading partner, and one of our major allies in the world. Our commitment to it remains undiminished.
We remember the Japanese proverb that "one arrow is easily broken, but not 10 in a bundle" - and we intend to stand by your side and offer you our support. Indeed, as we celebrate the 70th anniversary of diplomatic relations between us, we do so with greater optimism than ever about what lies ahead.
As a companion that is in for the long haul, Canada is prepared to match its words of support with steps of assistance. We are working with Japan, in the G-7 and APEC (Asia-Pacific Economic Cooperation forum), to support the hard-hit economies in Southeast Asia. For example, we have contributed to multilateral IMF (International Monetary Fund) assistance packages for Korea and Thailand, and have provided additional support for Indonesia and other countries in Southeast Asia.
But we also know, as you do, that Asia's problems will ultimately be solved by Asians - that reforms will need to be introduced, and difficult decisions will need to be made.
In the case of Japan, the problems are both structural and cyclical. To address these problems, Japan has introduced a number of measures, including the deregulatory "big bang" in financial markets. Other initiatives have included an injection of public funds into the banks, spending on public works, and tax cuts.
Canada supports these efforts as important first steps. We remain of the view, however, that the only way to sustained economic growth and recovery is through comprehensive deregulation and reform.
Deregulation will increase domestic demand, enhance global competitiveness and create new employment opportunities.
While the "big bang" will produce some deregulation, we believe that a more far-reaching restructuring of companies, inter-company relationships and distribution systems will be necessary if an extensive revival of the economy is to occur.
Canada does not speak as a critic of Japan - it speaks as a friend - one that has been through its own period of reform and renewal, and that understands the benefits offered by such a process.
While the challenges we faced were different from those confronting Japan, both countries share the need to respond to change - and I am confident that Japan will meet the test.
As I mentioned a moment ago, Japan stands second only to the United States as Canada's leading trading partner. Last year, two-way trade between us was more than $23 billion. And one third of all foreign investment coming into Canada came from Japan.
The size and importance of the Japanese economy can hardly be overstated. Japan alone accounts for almost one fifth of the world's GDP (gross domestic product), and produces almost 12 percent of the world's exports. The Japanese population of 126 million represents a sophisticated and highly competitive market. And in areas such as autos, electronics and industrial technology, Japanese companies are world leaders.
But Japan must also realize that just as a plane needs two wings to fly, so a nation needs both imports and exports to create a healthy domestic economy. Any effort to simply "export your way to recovery" is doomed from the start, because it deprives the Japanese economy of the invaluable infusion of trade and investment that is a spur both to local spending and to increased productivity.
So I would urge Japan to adopt a more open posture with respect to goods and services from abroad.
Canada wants to build on our already strong relationship with Japan, and has developed an Action Plan to enhance our commercial partnership. As many of you know, that plan identifies a number of sectors that we believe hold the most promise for Canadian businesses. These include tourism, information technologies, medical equipment and devices, consumer and building products, as well as food and fish products.
And just as we need to expand the awareness of what Canada has to sell to Japanese consumers, so we must enhance the understanding of what Canada has to offer to Japanese investors. We must let our Japanese friends know that Canada is an ideal place in which to invest or start a business.
Many of you will be familiar with a study conducted by KPMG that compared the costs of establishing a business in seven countries - five European, the United States, and Canada.
The study found that when you consider all of the elements, Canada ranks number one. In other words, it is cheaper to set up and run a business in Canada than anywhere else studied - cheaper than Europe, cheaper than Great Britain, and cheaper than the United States by some 5 percent.
This is a critical point. Investors from Asia who want a foothold in North America in order to get access to the 400 million consumers of the NAFTA (North American Free Trade Agreement) market, can do so in a more cost-effective way by looking to Canada rather than to the United States. To take a stark example from the KPMG study, an Asian business setting up a typical 100-worker plant in Canada, will save, on average, nearly US$1 million annually over a similar site south of the border.
We want to ensure that when Japanese business people think about investing abroad, a large red maple leaf to comes to mind!
Of course, the relationship between Japan and Canada goes far beyond the exchange of goods and services. There is also a very strong people-to-people exchange - through tourism, youth programs and the twinning of cities.
These not only foster good will between our people, but also help to ensure that the Japan-Canada relationship retains the profile it deserves.
I began by discussing the need for perspective in assessing the current crisis in Asia. And I suggested that those of you in this room had a particular role to play in providing that perspective.
Canadians want to understand events in Japan better. We need your insights, your wisdom, your experience. In the days ahead, your contribution is needed more than ever.
In closing, let me relay a story that is told of Abraham Lincoln, which I think captures the essence of what I've tried to say today.
One night, when he was a young boy, Lincoln and a friend were out walking, when a meteor shower began. Lincoln's young companion became frightened, but Lincoln told him to look beyond the meteors, to the fixed stars shining above them.
Today, we also must look beyond the present difficulties to the bright stars of opportunity and promise. We must see the storms for what they are - troubling, but temporary. And if we do, we will see the rising sun of Japan still shining behind the clouds, still full of promise, and still strong enough to provide a bright future for its people.
This is the future that Canada sees for Japan. And this is the future that we want to help build.
© Department of Foreign Affairs and International Trade, 1998
Japan Forum 1998:
The Future of Historic Cities
Promoting Economic Prosperity and Preservation
This program was held June 8, 1998, in co-operation with The Japanese Canadian Cultural Centre, and hosted speakers from Japan, who presented a program about efforts in Kyoto to maintain the city's historic, cultural and artistic heritage while promoting economic growth.
The forum addressed issues that all historic cities - including Toronto - face in trying to find a balance between historical preservation and modern urban development.
This program is part of The Japan Society of New York's program called the "Japan Forum". This Outreach Program has taken place annually since 1979. This is the second time we have worked with the Japan Society in New York on this project.
This year's participants from Japan also spoke in New York, Pittsburgh, and Philadelphia.
We would also like to take this opportunity to thank The Starr Foundation and Japan Airlines for their generous support of the Forum.
Speakers at the Japan Forum 1998 included left to right, Dr. Yoshifumi Muneta, Associate Professor in the Department of Architecture and Urban Planning at Kyoto Prefectural University; Marc P. Keane, Chairman and founder of the International Society to Save Kyoto; Mr. Diarmuid Nash, Associate, Moriyama and Teshima Architects in Toronto and an Adjunct Associate Professor at the School of Architecture and Landscape Architecture at the University of Toronto; Dr. Yuga Kariya, Chief Specialist for Cultural Properties, Cultural Properties Protection Department. Also pictured is Ben Ciprietti, President, The Japan Society (second from left).
Giving Friend Japan a Kick In the Teeth
The Washington Post
When your good friend is in trouble, kick him in the teeth: That seems to be the philosophy motivating U.S. attitudes toward Japan these days. Given Japanese arrogance in the 1980s, these attitudes may be understandable. But they don't make for good policy.
There's no question that Japan presents an easy target. When they were riding high in the 1980s, Japanese didn't hesitate to scold Americans for profiglacy and pridefulness. But Japan's economy has sputtered throughout the 1990s, and its politicians and bureaucrats seem incapable of putting things right. A record 72 percent of Japanese now say they believe their country is heading in a bad direction. Only 24 percent approve of Prime Minister Ryutaro Hashimoto. Leading industrialists compare him to Herbert Hoover and urge him to resign.
Americans and other outsiders are justifiably frustrated by Japan's apparent inability to deregulate and open its economy. As long as Japan stagnates, it can't do its part to ease the economic crisis in South Korea and Southeast Asia, and so more of the burden falls on the United States. One leading U.S. scholar, Edward Lincoln, now proposes that the United States insultingly "send the message that it no longer regards Japan as a global partner" by not returning telephone calls and not consulting on policy formulation.
The administration of the U.S. President Bill Clinton denies it is following this advice. Clinton, in a Wall Street Journal interview published Monday, said "I'm going to do my best to be a good partner to them." But when Bill Clinton goes to cement his "strategic partnership" with China with a six-day visit in late June - longer than any Clinton trip to Japan - he's not giving Tokyo the courtesy of a reporting stopover on the way home.
It's important to cultivate friendly relations with both China and Japan. But it's also important to keep in mind which country really is U.S. strategic partner. China remains a dictatorship committed to curtailing U.S. influence in the world. Japan is a democracy, with a far-larger economy, that supports the United States at almost every turn. It shares U.S. goals and contributes resources to U.S.-backed programs in almost every field, from democracy- building to nonproliferation to military security to economic development in poor countries. Japan may be an irritating friend at times, but it is friend. Forgetting that now wouldn't be right - or smart.
Kanazawa City
Located on the west side of Japan on the Sea of Japan, Kanazawa is one of Japan's foremost castle towns. The city boasts many places of historic and aesthetic interest, such as the splendid Kenrokuen, known as one of the three most beautiful gardens in Japan, and Ishikawa-mon, the commanding gate to the old castle grounds.
In Kanazawa, one is acutely aware of the changing seasons. Not only is Kanazawa's natural scenery a colorful delight year-round, but every seasonal change is so carefully celebrated in Kanazawa's traditional cuisine, decor and yearly events, that one comes to feel as if there are many more than four seasons.
Geographically, Kanazawa's central location makes it an ideal base for exploring the Hokuriku region, as well as neighbouring Toyama, Fukui and Gifu prefectures, are all easily accessible from Kanazawa.
Kanazawa's history began in 1546, when the Buddhist Ikko sect set up a religious government centered on a temple, which later became the site of Kanazawa Castle. The Buddhists' power grew, and so did Kanazawa. Kanazawa was invaded in 1580, and following a turbulent period, was finally taken over by Maeda Toshiie, a retainer of Oda Nobunaga, in 1583. When Japan came under the control of the Shogun Tokugawa leyasu in 1603, Maeda's vast territorial holdings were recognized, making Kaga the wealthiest province in Japan. Its wealth, measured by its rice yield, was one million koku, or five million bushels. Hence, the elegant and refined culture that developed in Kanazawa under Maeda's patronage is referred to as Kaga Hyakumangoku.
In 1871, when the feudal provinces were abolished and modern prefectures established, the Kaga region was the third most populous in Japan after Tokyo and Osaka. Since Maeda Toshiie's entrance into Kanazawa in 1583, the city has been completely untouched by war and thus retains much of its historic beauty. While preserving its precious heritage, Kanazawa has developed into a thoroughly charming and modern city.