Japan Digest #372

1.        Japan To Strengthen Security Cooperation With Philippine


PM Kishida is visiting Philippine today and meeting with President Marcos. 

The main topic of the summit meeting is how to strengthen the mutual security cooperation in the face of escalating Chinese military and coast guard presence in the South China Sea and in the other regional sea.

The two leaders are expected to agree that the mutual administrations will enter negotiation to conclude Official Security Agreement (OSA) and Reciprocal Access Agreement (RAA).   

The Japanese government has already solidified its policy to provide Philippine with its small patrol boats and radar systems as well as drones for free once the OSA is concluded.

After Philippine, Kishida is visiting Malaysia to do the same arrangement. 

Besides, the government of Japan is planning to cover Bangladesh and Fiji under OSA in this fiscal year’s budget.


2.   Foreign Minister Kamikawa’s Visit To Israel


Foreign Minister Kamikawa visited Israel on November 2.  

She is meeting with Israeli Foreign Minister Cohen to deliver the Japanese government message that it would like Israeli Government to put the war temporarily on hold for the sake of humanitarian purpose and secure an environment under which humanitarian aid activities can be made. 

Minister Kamikawa is also meeting with some senior leaders of the Palestinian organization. 

In the meantime, the government of Japan has already frozen the asset of nine Hamas leaders and one affiliated organization to cut off Hamas’ revenue source.


3.  Bank Of Japan To Lift The Upper Limit Of The Long-term Interest Rate


The Bank of Japan held a Monetary Policy Meeting on October 31 and decided to abolish its policy to make 1% p.a. as a de facto upper limit of long-term interest rate. 

Governor Ueda said in the press conference of October 31 that he would not anticipate any jump of long-term interest rate though fixed rates of house mortgage loans would go slightly up.

BoJ’s quantitative easing policy continues for the time being, but some analysts anticipate that BoJ might begin tapering the QE early next year depending on the economic recovery situation then.


4.  Japan To Collaborate With U.S. For Fast Reactor


Yomiuri reported on November 1 that Japan Atomic Energy Agency and TerraPower in the U.S. reached an agreement to strengthen the collaboration with regard to Japan’s development of fast reactor. 

TerraPower is ahead of JAEA in developing demonstration reactor, so it will provide JAEA with technical assistance for JAEA to complete its demonstration unit, while JAEA will provide TerraPower with its accumulated technology.

JAEA’s fast reactor development had been successfully in progress up to the stage of a prototype reactor called “Monju”, which successfully went critical in 1994. 

However, its demonstration reactor experienced a series of troubles, thus the decommissioning of the reactor was decided in 2016.   

METI’s master plan to develop fast reactor shows that designing of demonstration reactor will begin next year and its operation will begin in 2040s.


5.  Japan’s Auto Production Recovered In The World Except China


Japan’s top eight auto companies announced on October 30 that they produced 12,639,043 cars in the world from April through September this year, which is a 7.4% increase from the same period last year.

Toyota produced 5,058,248 cars, which is a 12.8% increase and the highest ever for a first half of its fiscal year.

The number of the cars sold by the eight companies from this April through September was 12,301,315, which is a 7.7% increase, while Toyota sold 5,172,387 cars (9.1% increase). 

Those Japanese car manufacturers, however, decreased both production and sales in China.

Except for Toyota, Honda’s sales in China declined by 12.3% while Nissan by 20.3%.  

It seems that they are having a difficult time to catch up with the drastic EV shift in the Chinese auto market.