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Post-COVID Japan must stay open

Jexit is a recipe for global irrelevance

| Japan
People wait to receive vaccination in Tokyo on June 30: Japan's national confidence has been diminished.   © Getty Images

Nobuko Kobayashi is a partner with EY Strategy and Consulting Co., Ltd., Strategy and Transactions -- EY-Parthenon.

The Emissary is an award-winning dystopian novel by Yoko Tawada depicting a decoupled Japan. It portrays a world after Jexit, a self-isolation achieved on a quieter yet more comprehensive scale than the one executed by its real-world cousin, Brexit.

The consequences are dire. Electronic appliances are banished in order to save electricity; domestically produced food is rationed, and international airports are left to crumble.

The society of The Emissary may sound preposterous, but it can still give a chill down the spine. Mentally, if not yet economically, Japan in 2021 is tilting toward sakoku, the officially closed state that existed from 1600 to 1864. Today, we stand at a fork in the road -- now is the time to double down on staying open.

Steps toward Jexit begin at the top. During the initial phase of the pandemic, from March to September 2020, Japan banned the reentry of foreign residents while still permitting Japanese citizens to reenter. In contrast, all other Group of Seven countries granted foreign permanent residents the same travel rights as their citizens.

This double standard sparked criticism from Japan's domestic business leaders and the international business community. In late June, the EU lifted restrictions on nonessential travelers from Japan. But Japan's border remains shut to international travelers.

Tone affects people's psyche. An expatriate executive, who has continued to travel widely, recounts the rapid deterioration of English language skills at Japan's airports, restaurants and hotels, which he claims started in the fall of 2020. He attributes this not to a lack of practice but to an emerging "Japan for Japan only" attitude. Since then, it has only gotten worse.

Why would the pandemic steer Japan to a state of withdrawal? First explanation: this is a typical response to a common crisis in Japan's past, where the handful of elite decision-makers huddle to hammer out policy behind closed doors. In politics, as in business, crisis makes Japanese behave in an extremely Japanese way.

Unfortunately, this approach backfired with COVID-19. The unpredictable, fast-spreading nature of the crisis left Japan's detail-rich, time-consuming, consensus-based management approach sorely outpaced. Japan's vaccine rollout remains one of the slowest among major world economies.

Then the second explanation kicks in. Because of its notable failure in its vaccination rate relative to other countries, Japan's national confidence has been diminished, which has, in turn, aggravated navel-gazing. Confidence, oversized or undersized, can equally drive a nation into isolationism. Today, Japan risks mental withdrawal because of the latter.

But 2021 is the wrong moment for Japan to turn inward. We must do exactly the opposite -- free our minds to embrace new ideas, new political narratives and new ways of life. We must seize the stimuli coming in from the outside world.

Post-COVID-19, there is a new window of opportunity to re-imagine the global future. Universally, we have a chance to question everything from shortsighted approaches to capitalism to how we balance work and life. Japan needs to help shape this narrative for three reasons.

Firstly, the major challenges that the world faces -- present and future pandemics, climate change, inequality baked into market mechanisms, lack of a value-based response to rising autocracy, to name a few -- can only be addressed through intense international collaboration.

As the world's third-largest economy, Japan must demonstrate leadership on the international stage. For example, though Japan may feel defeated for failing to produce its own vaccines this time around, it should anticipate the next health crisis and ask how it can better contribute to the world and to itself.

Secondly, Japan can leverage global knowledge to fix Japan's problems -- for example, the pandemic highlighted the universal suffering that minorities experience in the workforce, such as women who juggle paid work and unpaid care. As the policy debate around the world intensifies on how to improve conditions for working mothers, Japan can seize the momentum and leapfrog ahead of other nations, leaving its lackluster status as a gender diversity laggard behind.

Finally, I believe there is a specific role for Japan to play in the narrative on values because of who we are. As graying and shrinking demographics suggest, Japan is past the growth-for-growth's-sake mantra. Pollution in Japan, once intensified by surging economic growth, has largely disappeared. If quality of life and living in harmony with nature drive our current economic behavior, Japan can blaze a trail post-COVID-19.

Of course, it will take a course correction for this to happen. Before COVID-19, Japan was caught up in a frenzy of multiplying inbound tourists and increasing how much money they spend. The inevitable downside was too many tourists for locals to comfortably accept in popular destinations such as Kyoto.

Tourists walk past souvenir shops in Kyoto in July 2018: before COVID-19, Japan was caught up in a frenzy of multiplying inbound tourists and increasing how much money they spend. (Photo by Kento Awashima)

But if we genuinely care about the quality of experiences for tourists, as well as protecting our habitat, is the number of inbound tourists really the proper measurement of success? These are questions Japan must urgently ask itself.

What I found more depressing in The Emissary than the rationed food and energy was the complete ban on cross-border exchange of people and ideas. In the novel, even foreign words, such as ON and OFF, are off-limits.

In today's knowledge-based economy, the cost of such limitations is immeasurable. Even though it may be ludicrous -- although not impossible -- to think that in an era of ubiquitous internet access, a border wall could be raised in people's minds, spray-painted with the words Japan for Japan only. The thought itself is harmful enough. Japan can learn as much from the world as it can offer. No one wins from Jexit.

The views reflected in this article are the views of the author and do not necessarily reflect the views of the global EY organization or its member companies.

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