"Germany Shows Superior Competitiveness Compared to Japanese Products"
"Korea Enhances Product Competitiveness Centered on IT"
"Japan Criticized for Failing to Read the Flow of Change"
A well-known Japanese economic commentator evaluated that the competitiveness of domestic companies is lagging behind that of Korea and Germany, pointing out that the reason is the failure to grasp the flow of change.
Japanese economic commentator Kaya Keiichi recently posted a column titled "Why the Japanese economy was completely defeated by Germany and Korea, and what went wrong at the turning point in the 1990s" on the local IT specialized media 'Business Plus IT'.
He opened by saying, "Japan's Gross Domestic Product (GDP) is being overtaken by Germany. Already, Taiwan has surpassed Japan in per capita GDP, and it is only a matter of time before Korea overtakes Japan," adding, "Domestically, there are many reactions calling this phenomenon 'shocking,' but is it really so? For those who know the past and the current state of the Japanese economy, it is not that surprising."
Kaya argued that the Japanese economy had never originally beaten Germany. He said, "As of 2022, nominal GDP (in dollars) is $4.3006 trillion for Japan and $4.0312 trillion for Germany, with Japan slightly ahead," and predicted, "According to the International Monetary Fund (IMF) forecast, Japan is expected to barely stay ahead of Germany in 2023 as well, but if the yen weakens more than expected, it could be overtaken as soon as this year."
He continued, "Japan's population is about 125 million, whereas Germany's is about 83 million," and added, "Germany's per capita GDP is 1.4 times that of Japan." This means that because Germany's population is much smaller than Japan's, its per capita GDP is naturally higher.
Furthermore, Kaya explained that the reason Germany's economy surpassed Japan's is because it exported highly competitive products. He said, "In terms of purchasing power parity, Japan's per capita GDP has never exceeded Germany's even once," emphasizing, "Although Japan has been overtaken in terms of scale due to population size, we must not forget that essentially Japan is in a position of chasing Germany."
"Korea has grown from a Japanese subcontractor to an industrial nation surpassing Japan"
Kaya also mentioned Korea. He said, "In the past, Korea was a country producing parts as a subcontractor for Japan, but since the 1990s, it has achieved remarkable growth in IT and semiconductor fields, growing into an industrial nation surpassing Japan."
He added, "Since 2010, Korea's average real growth rate has exceeded 3%, maintaining high growth," and "There is no doubt that advanced industries, including Samsung Electronics, support this series of high growth."
He highly evaluated the competitiveness of Korean products. Kaya said, "Compared to Japan, Korea maintains a high value of the won, which is a considerably unfavorable environment for export companies," but praised, "Despite that, Korea's exports are strong because Korean products are highly competitive."
Kaya pointed out that the reason Japanese companies' competitiveness is behind Germany and Korea is because they failed to read the flow of change.
He said, "Japan's share of the global export market has sharply declined since the 1990s. The biggest reason is the failure to properly grasp the change of business IT-ization," adding, "Japanese companies stuck to traditional product strategies and were almost completely defeated in fields such as semiconductors and electronics."
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