Japan has the second largest economy in the world, which is a phenomenal achievement considering that Japan has very little natural resources.
This is achieved by purchasing raw materials or semi-finished parts/products from other Asian countries and then processing them into finished parts/products.
While any nation can achieve the above, the advantages that Japan has used to stay ahead are its advanced technology and its highly motivated workforce.
Japanese companies regularly invest large portions of their profits into research and development. In many fields such as robotics, electronics, textiles and construction, the Japanese are on the cutting edge of new technology.
The workforce works in close co-operation with management. Strikes are extremely rare and when they do occur, Japanese employees continue working and demonstrate their displeasure by wearing a black armband.
Problems with the Japanese economy
After the war, Japan reinvented itself, found innovative products to make and pushed ahead with its technological development. Expansion of its sales into the USA and later the European markets created a boom which continued through the 90’s. The crash came when property prices (which were over-inflated) peaked and then crashed.
The whole economy suffered in the resulting financial crisis and has stagnated through most of the 1990’s, despite the fact that industry and technology are still in a strong position. Fundamental structural changes need to be made within the economy to pull the nation out of its slump. Such things as a huge corporate tax, 50% tax on property sales and a population which is not inclined to demand change are contributing factors. A lot of the money collected through tax is then spent subsidising domestic agriculture and then buying the products at a high price to sell back to consumers at a lower price. National debt also takes its toll.
But changes are now underway. Japanese companies are also forced to expand their foreign sales and production, which means an increased need for new employees in Europe, US and Asian operations.
Despite all these problems, Japan still has the second largest economy in the world.