The Impact of Export on China and Japan's Economy - Coursework Example

The Impact of Export on China and Japans Economy The Impact of Export on China and Japans Economy Part III: China and Japan presently share the third largest trading relationship all over the world.  Despite the fact that the mentioned nations are economically interdependent, they also have a complicated political relationship. Nonetheless, there is minimal evidence of political facts affecting investment and trade in the recent past (Huang, 2013).             There have been cases of political tension between China and Japan. For instance, when the prime minister of Japan was Koizumi, the leadership visits between the two nations remained temporarily suspended. In 2015, there were widespread anti-Japanese protests that included boycotting the Japanese commodities. In 2010, there was a further tension surrounding Japanese. The tension was a result of Chinese trawler captain being arrested. Moreover, there have been other different episodes of political tensions between Japan and China. Nonetheless, the political tensions have not impacted on the economic relations of the two nations. Regional and bilateral trade, in addition to Japan heavily investing in China, has expanded despite the tensions (Zhang, 1998).              It is imperative to note that there is no significant time that Japan and China have enjoyed a stable or close political relationship. The existence of unresolved historical issues and complicated political relationship can increase risks. This can make potential investors and traders to prefer investing or trading with other nations with less political or cultural distance.  Furthermore, in the case of China and Japan, the existing bilateral political tensions have not derailed the established economic relationships that have been in existence since 1978.  Instead, the economic relationships have at times mended the political ties by assisting in preventing heightening political tensions. One of the reasons why political tensions did not hamper the economic situation is that China was not only committed to opening its diverse economy but also venturing into the global trading systems. The mentioned commitment contributed to strong economic relationship that saw both China and Japan trading with one another (Huang, 2013).              Moreover, China venturing into the global trading system via rapid trade liberations particularly in the 1990s was aimed at being part of the general agreements on tariffs and trade.  The country later joined the world trade organization (WTO). However, it is important to note that the GATT accession started in 1986, in addition to unilateral liberalizations as well as concurrent domestic reforms. Consequently, the commitment to reform and liberations via the WTO placed several constraints on the Chinese major players, such as policymakers. This became Chinese deliberate step not only in widening pro-market reforms but also expanding the Chinese economy. The expansion of the economy and the constraints meant that the influence of the state on foreign and domestic companies waned. Furthermore, accession of China into WTO was a clear demonstration of its commitment towards continuous reform and marketization. This offered the international economic community, Japanese and other companies the confidence of conducting business with China. In regard to the mentioned, the economic engagement between China and Japan could be based mainly on market forces that built economic relations between nations (Huang, 2013).             Consequently, there is sufficient evidence that proves that recent political tensions between China and Japan contributed to severe economic effects. Iriye (2014) in his study examined the effects of political events on economic situation of a country. He focused on China and Japan, between 2005 and 2010 on the shares prices and sales of Chinese and Japanese firms. During the mentioned periods of increased political tension, the study reported that Japanese firms with high exposure to Chinese companies in China were adversely affected. However, in the case of the Chinese companies, the firms that were mostly affected were those that sell directly to the Japanese customers (Schirokauer et al., 2013).               Even though some effects of political distance are expected, the outcomes are not identifiable in the aggregate investment or trade data. The geographical proximity of Japan, its technology, capital and general knowledge has continued to be of significance to the economic modernization of China. The Chinese rapid economic growth, large market potential and cheap production outweighs the risks associated with the intensity of the political tension between Japan and China. Despite the existing political tension, China and Japanese economic relationship has flourished instead of being derailed. The mentioned is because of the confidence emulated by both countries. They have also showed their commitment towards norms and rules of the international trading system. The example of China and Japan is in contrast with other numerous cases across the globe, where political tension has negatively impacted on the economic relations (Zhang, 1998).             Lastly, in the recent past, there has been a new development in the China-Japan relationship that is likely to undermine the present economic situation. As a result of the collapse of the Doha Round in negotiation for better trading deals in the WTO as well as the global proliferation of various trade agreements that undermine the WTO core principles, there have been no confidence in the existing global trading system. It is also important to note that beyond the WTO, there are no frameworks or rules that control economic exchanges between China and Japan. Therefore, the eradication of the global trading system can be attributed to the implication of the bilateral relationships between the two nations. Part IV: For the past century, there have been profound economic, technological, and social transformations that have impacted on the country’s growth. In the OECD nations, full development as well as various innovations such as telephones, electricity and automobiles have accompanied the emergence of mass government, mass product and mass consumption; thus, steering development in nations such as Japan and China (Zhang, 1998).              Japan quickly embraced modernization because she wanted protection against western countries colonization. The second reason is that it wanted to amend the existing unequal treaties with other foreign countries. Nonetheless, after the Russo-Japanese war that took place between 1904 and 1905, immediately after the mentioned problems were solved, Japan commenced on colonizing other nations. The reason why Japan started colonizing other nations was because of its overflowing population. It is important to admit that Japan policy was to make the neighboring countries experience challenges. After the 1931 Manchurian incident, the national Shinto was manipulated with an aim of uniting people’s minds. Immediately after the World War II, the Occupation Army issued a Shinto Directive. The directive required Japan to initiate separation of the church from the state. The demand was so intense. Therefore, along with other several policies, for example reform of the land system and family system, the issued directive had serious impact on the moral education promotion. Thus, the directive contributed to the development of the formal education in China. Compared to Shinto, Confucianism suffered more damage. In the later years, nothing traditional revived to hamper Chinese development progress. The mentioned is not because reactionist and conservative groups manipulated the change but due to the fact the Chinese people attempted to revise the traditional cultures (Schirokauer et al., 2013).             With the recent transitions in China, the country offers a social cultural environment for development. There is sufficient supply of labor from its huge population. Moreover, there is foreign direct investment and enough household savings. China also provides a technological environment that promotes transfer of information. In addition, significant structural as well as legal reforms remain unknown. However, it can be predicted that China has a bright future ahead. This is because the nation can successfully balance development and its cultural roots (Iriye, 2014).              It is impossible for a country to grow economically without sufficient infrastructure. The infrastructure of China remains complex, and entails the services provided by both private and public utilities that foster consumption, trade, and production. These services include telecommunication, power, sewage and sanitation, railways, piped gas, water, airports, ports and importantly banking (Schirokauer et al., 2013).              For the past two decades, China has concentrated in revitalizing its entire infrastructure. Much of the country’s success stems from privatization of enterprises, breakdown of monopolies to create fair competition and creation of agreements and treaties that promote fair foreign business relations (Zhang, 1998).             On the other hand, the contemporary Japan is regarded as a secular society. There is creation of harmony with others through reciprocity as well as fulfillment of various social obligations that have been significant to its economic development. Self-development, harmony and order are the most significant values that define Japanese social interaction. Basic idea about nature and self of human society stem from philosophical and religious traditions. The religious practices teach the importance of having harmonious relations. This has made the people work in harmony, and steer development (Zhang, 1998).               The Japanese children learn that human fulfillment is drawn from close relation with others. Therefore, from an early age, Japanese children recognize existence and importance of interdependent society, starting with the family and later extending to other larger groups, for example, school, neighborhood, workplace and the community. This creates the spirit of unity, which is important for a country’s development (Schirokauer et al., 2013).              In Japan, working in groups needs effective channels of communication that reinforces group independence. However, social interaction that occurs in people whom one works and lives is important in the contemporary society. Moreover, the Japan status is based on particular relationship, for example, relationship of social dependency. Duty is the sense of obligations individuals that one remains indebted. Social dependence relations continue indefinitely, with inequality between individuals functioning as binding force. The mentioned has led to the country’s development as people work together to ensure that the nation realizes its goals and dreams (Schirokauer et al., 2013).               Lastly, it is possible for economists to explain the country’s development without talking about culture. However, culture plays a significant role in development just like other conditions that need to be met for a nation’s economy to develop. Government is seen as important for development. The political system should be stable, laws clearly stated as well as enforced to ensure that all contractual agreements are honored. The government officials should be efficient and not corrupt. Land should also be made available at fair prices for establishment and expansion of business opportunities. Japan and China culture promote good governance, relations/coexistence that has promoted development over the past decades (Schirokauer et al., 2013). References Huang, X. (2013). Modern economic development in Japan and China: Developmentalism, capitalism, and the world economic system. Basingstoke: Palgrave Macmillan. Iriye, A. (2014). The Chinese and the Japanese: Essays in Political and Cultural Interactions. New Jersey: Princeton University Press. Schirokauer, et al. (2013). A brief history of Chinese and Japanese civilizations. Boston, MA: Wadsworth Cengage Learning. Zhang, D. D. (1998). Chinas relations with Japan in an era of economic liberalisation. Commack, NY: Nova Science Publ. Read More