The long -term use of the Japanese government's monetary policy, including low interest rates and quantitative loose (QE), is the culprit of strangling national competitiveness.Zombie companies, which have long relying on loose monetary policy and relying on banks to reduce interest and exemption, continue to exist, and the Japanese economy has lost its due metabolism function.
In the World Economic Outlook Report announced in October, the International Monetary Fund (IMF) predicts that the nominal GDP (GDP) of Japan in 2023 will be lower than Germany, ranking fourth in the global economy to fourth placeEssenceJapan's name GDP in 2023 is estimated to be US $ 4.23 trillion (about S $ 5.77 trillion), a decrease of 0.2%compared with last year, and Germany's nominal GDP will reach $ 4.43 trillion, an increase of 8.4%over last year.
This is indeed a "disturbing" news in the Japanese.In 1968, Japan surpassed West Germany at the time and became the world's second largest economy.Feng Shui took turns, and the scale of Japan's economy was half a century after Germany, and this year was overtaken by Germany.And the IMF also made up a knife: If there was no accident, by 2026, India's GDP will exceed Japan.This means that in the next few years, the status of Japan's fourth largest economy will not be able to keep it, from Fu Gaoyi's "world first" to fifth in the world.
The depreciation of the yen is a major reason
The analysis of Kyodo News Agency is that the devaluation of the yen is a major reason for this phenomenon.This view is undoubtedly a certain reason.When the IMF is in the ranking of the world economy, it is based on the GDP of the US dollar pricing as a reference basis.Therefore, if the currency of an economy is relatively good for the US dollar exchange rate, it may occupy a better ranking than another economy.
As early as 2000, the yen exchange rate was about $ 1 against 105 yen. At that time, Japan's economic scale was US $ 4.97 trillion, ranking second in the world, 2.5 times that of Germany at that time.At the beginning of last year, the yen exchange rate was about 1 US dollars against 110 yen.However, due to the different monetary policy of Japan and the United States, the interest rate difference between the two countries has expanded. Since June this year, the yen exchange rate has maintained a range of $ 1 to 140 to 150 yen.In this way, GDP, which is calculated in the US dollar in Japan, will also be reduced.On the other hand, the exchange rate of the euro against the US dollar has not fell sharply as the yen to the US dollar exchange rate.
In addition, price changes are also a reason.Name GDP is the total value created by a country. Although it indicates the economic scale, it is also affected by the change of price.From January to August this year, the German consumer price index remained at 6%to 8%year -on -year, while this number in Japan was about 3%.The rise in prices also seems to have drove the growth of German nominal GDP.
But obviously, the above factors are not the real reason why Japan began to fall behind in Germany.Observing the currency pricing of their respective countries and the nominal GDP growth rate since 2000, Japan is 1.1 times, which is significantly lower than Germany 1.9 times and 2.6 times the United States.Judging from the actual GDP after eliminating the change of price, Japan's growth rate is only 1.2 times, which is significantly lower than the United States and Germany.From the perspective of increasing productivity and technological innovation, Germany is also a leading position compared to Japan.
What is the true reason for the falling economy in Japan?Personally, the Japanese government's long -term use of monetary policy, including low interest rates and quantitative loose (QE), is the culprit of strangling national competitiveness.
Since the crushing economic bubble in 1991, Japan has always adopted a low interest rate policy in order to stimulate the economy, but the results have been very small.Whether it is the residential department or the enterprise department, the willingness to borrow is not high.Not only are they not high, they all rush to repay the loan, in order to repair the asset -liability sheet that has gradually deteriorated after the bubble is burst as soon as possible.
But for this phenomenon, the Japanese government's understanding is that interest rates are still too high.As a result, from 2001 to 2006, the Bank of Japan still injected liquidity into the banking system through a large number of continuous purchase of public bonds and long -term bonds, so that interest rates always maintained a level nearly zero.Its subjective desire is to induce the corporate and residential departments to expand loans by injecting liquidity into the banking system, thereby increasing the currency supply of the entire economic system, promoting investment and recovery of the national economy.
But as I mentioned in the Grand Trends of Grand Trends in the world in early 2012 -mentioned in the World Book of Treasury, the "biggest benefit" of this policy is to allow those zombie companies that have no competitive zombie companies to surviveIt is longer, which means that the resource mismatch is longer.In the long run, this will only end with competitiveness that is damaged in one country.
Specific to Japan, I wrote in the book: "Some people think that the 20 years lost in Japan is a structural crisis, not a periodic. This is obviously the product of a static perspective observation.The sexual crisis can be converted into a structural crisis, and its dynamic scene is probably as follows: this is a periodic crisis, but through the government's water intervention, a large number of zombie companies have been cultivated.More importantly, resources cannot optimize allocation, and cannot transfer to enterprises and industries that are more configured, which leads to the solidification of the industry, so the cycle crisis evolves into a structural problem.
Yes, with the increasing cost of domestic land in Japan and the gradual disappearance of the demographic dividend, a new international industrial transfer trend in the 1980s and 1990s has inevitably emerged.It is a pity that with the crushing of the big bubble, the Japanese government blindly takes care of the interests in front of the eyes, adopts loose monetary policies and positive fiscal policies, rather than killing zombie companies, clearing debts, and accelerating the upgrading of the industrial structure. As a result, it is solidified.The original industrial model.
In this context, Japan cannot enjoy the benefits brought by the development of emerging economies such as South Korea and China.On the contrary, as emerging economies such as South Korea and China have joined the team, the domestic industries in Japan have further touched; they are subject to land costs and labor costs, and they cannot compete with South Korea and China in low -end products.Due to the failure to achieve industrial transformation and upgrading, it has also become unable to compete with European and American countries in terms of high -end products.In other words, the loose monetary policy has led to the solidification of Japan's original industrial structure. As a result, the economy is becoming zombie, and then embarrassing is stuck in the middle.
In short, zombie companies that have long relying on loose monetary policies and relying on banks to reduce interest and exemption have continued to exist, and the Japanese economy has lost its due metabolic function.This is the fundamental reason for the stagnation of Japanese economic growth in the past 30 years, and it is also the reason why Germany is about to overtake Japan.
This is undoubtedly of a certain enlightenment for many economies, especially China.
The author is a Chinese economist and a financial columnist
