How the Past Gets in the Way of 'Abenomics'
This week's visit by 168 Japanese lawmakers to a politically charged Tokyo shrine wasn't just dreadful diplomacy; it was dismal economics, too.
Media reports pooh-pooh the event because many of the pilgrimaging officials were low-ranking conservatives. That might be a plausible argument if Deputy Prime Minister Taro Aso hadn't made his own visit over the weekend to Yasukuni Shrine.
The Yasukuni Shrine is viewed in China and South Korea as a symbol of military atrocities during Japan's occupation in the first half of the 20th century. The shrine commemorates Japan's war dead, including World War II leaders convicted by an international tribunal of war crimes. Hence the anger these visits provoke in China and South Korea, especially when carried out by an official of Aso's importance.
Aso is Shinzo Abe's right hand and, as finance minister, the face of "Abenomics," the prime minister's nascent plan to end Japan's lost decades. A key pillar of Abenomics is driving down the yen to help beleaguered exporters. The currency has fallen by 20 percent against the dollar in the past six months.
Yet here's a question Aso should ponder seriously: What’s the point of a lower exchange rate if two of your biggest customers boycott your goods? South Korean Foreign Minister Yun Byung Se canceling a trip to Tokyo this week may prompt trade officials to turn their planes around. Chinese ministers, too.
It also could be an omen of things to come. As I pointed out in an April 12 column, Abe has never forgotten his nationalist roots, which were on clear display during his first stint as leader from 2006 to 2007. The risk is that his high approval ratings and a likely big win in upper-house elections in July embolden Abe to flex muscles in a region still smarting over its militarist past.
Things are tense enough in North Asia as China, Japan and Korea fight over tiny islands, and Kim Jong Un rattles his saber in Pyongyang. The last thing the region needs is another controversy getting in the way of a $340 billion trade relationship in such a chaotic global environment. If Abenomics is to guide Japan down a more prosperous path, Abe's team must leave the nationalism at the door.