Nippon Keidanren`s Proposal for National Blueprint

Peter Tasker, a financial guru and novelist, once warned in his novel `Dragon Dance,` set in 2006 that a worse Japanese economy due to the poor reform would create family homeless who possibly plunder shops and companies, putting the country in an absence of security.

Nippon Keidanren (Japan Business Federation) proposed on Jan.1 a bold, long-term national vision called `Toward a vital, attractive Japan.` The `Okuda vision,` named after current Nikkeiren chief and Toyota chairman Hiroshi Okuda, predicted economic and social changes by 2025 and proposed necessary policies to accomplish the plan. He also made clear that he will resume the political contribution, abolished in 1993, from this year and standardize it on the basis of policy evaluations.

This vision includes an unprecedented proposal to raise the consumption tax 1% every year from the current 5% to 16% by 2014 in order to achieve the real growth of 2%. In an aging society, a strengthened social security can get rid of worries about life after retirement, therefore reviving the consumption and economy.

Furthermore, Okuda predicted that the working population would decline by 6.1 million, arguing that the immigration of foreign workers should be allowed. The proposal included an idea that the country should introduce the state system by dividing the territory into 5-10 regions and transferring the administrative authority to the local governments. In addition to this, it claimed that the country should promote the establishment of environment that leads the global market with the energy conservation technology and also claimed that it should create a free trade bloc in the East Asia jointly with Korea, China, and Association of Southeast Asian Nations (ASEAN).

The reason that the Japanese business circle is taking actions is that they decided the reform by the Koizumi cabinet has been sluggish and they cannot entrust the economic recovery only to politicians and officials. The government repeatedly talks about the reform, but Nikkei Stock Average Index plummeted to all-time low in 19 years and the unemployment rate rose to 5.3%, the highest level.

Young-Ee Lee yes202@donga.com