How Japan Can Make the Third Miracle from the Disaster

Osaka - Saturday, March 26, 2011




Japan has made miracles twice in its history. The first one is of 140 years ago, of Meiji Revolution in which after almost 300 years of isolation from the rest of the world of the Edo period Japan opened the door to the rest of the world and made drastic innovation to realize revolution. The second one is of 70 years ago, of reconstruction from the defeat of World War II in which atomic bomb was dropped to Hiroshima and Nagaski and it was believed that the country would not be able to revive. But with support from the U.S. and other countries, Japan, the only country ever to suffer an atomic attack, managed to recover and reconstruct, to realize substantial economic growth to become the second biggest economy.



What Dr. Neal calls “natech” (“Na”ture + “Tech”nology combined) disaster in the interviewed introduced in the previous article How the World and Japan Should Handle Japan Disaster is the worst disaster since the World War II defeat. Recovery has started and it is reported in media that the world is surprised at the speed to rebuilding of roads in Sendai; however, and recovery and reconstruction from the “natech” disaster is like making the two previous miracles, as mentioned in an article issued on March 25, of Nikkei, the Japan’s leading newspaper specialized in business and economy.



Following the previous article Japan Disaster to Hit Global and Japanese Economy in which she outlined the size of the affect of the disaster, the author would like to outline what needs to be done to make the third miracle, of recovery and “creation” of a new country, to conclude her (first) series of blog articles about the disaster.



1. First and foremost, rescue people who are still missing



As of 9:00 on March 24, as announced by the National Police Agency and reported by Nikkei, 9,811 people are dead, 17,541 are missing, and 2,779 are injured. It is two weeks from the earthquake and tsunami and the rate of survival is extremely low, but a woman of 80 years old and her grandchild survived for 9 days and were rescued. Some cities/villages are totally swept out by tsunami and wreckage remains in wide a scope of areas so rescuing the remaining people missing is taking time. However, rescue needs to be proceeded.



2. Immediate recovery of Fukushima Daiichi Nuclear Plant is critical



It goes without saying that immediate recovery of Fukushima nuclear plant is inevitable to avoid further negative effects on lives of residents in the area, on agriculture and fishery of the area and prefectures near by, on water supply to regions including Kanto (e.g. Tokyo, Chiba, Saitama), and on global environment. Engineers of Tepco have been doing everything they can for recovery in extremely tough situation as reported in online news on March 25 in website of Asahi, a major Japanese newspaper, based on the information from wives of the engineers; very little time to sleep and when they sleep they do so sitting on chairs, food is only biscuits with minerals, and so forth.



3. Smooth recovery of electricity supply in Kanto area is inevitable



Halt of Fukushima nuclear plant led to shortage of electricity supply in Kanto area and thus “planned” blackout has been ongoing, which is likely to continue for months. This has been causing many problems in the society, business and people’s everyday lives, as mentioned in the previous article The Reality of Japan Disaster – Affecting Nationwide. Without recovery of electricity supply, people’s lives would not return to what it was before the disaster, nor business activities which is the source of economy and capital necessary for reconstruction.



Organizations and individuals are making upmost efforts to save energy to avoid “planned” blackout but the experts estimated that blackouts cannot be avoided in summer and winter, when electricity usage reaches at the peak due to use of air conditioning. Some experts also point out that transferring electricity from Kansai (western Japan) and Hokkaido (northern island) to Kanto would be extremely limited because of technical reasons for Kansai and need to cross over sea for Hokkaido.



Noguchi proposes that such measures as immediately reviewing jacking up of basic rate of electricity and fetching down amperage under contract could avoid “planned” blackout until the end of April. However, he also says that even such measures would not be sufficient to avoid “planned” blackout in summer. Other experts and the government are pursuing other measures such as implementation of summer time.



After recovery of the plant, the government and energy supply related parties would need to reconsider total energy supply system. The key concept in reconsideration would be diversification of energy supply to minimize risk of energy supply shortage, and pursuing green and safe energy.



4. Of course, reconstruction of lifeline and social infrastructure is a big issue



Since everything is destroyed including local government office of many cities even if the cities were not 100% swept away by the tsunami, reconstruction of social infrastructure including roads, public and commercial facilities, housing, energy and water supply is necessary. It is just like creating new cities/prefectures from scratch.



This process would not necessarily mean reconstructing exactly what it used to be. Process needs to be that of determining what to recover/leverage and what to change/create to improve/eliminate the weaknesses the Tohoku and Japan had before the disaster. In fact, this could be a great opportunity to eliminate weakness and correct “contradictions” the country had and transform the total economic, industrial and social structures.



As in the case of Kobe earthquake in 1995, the region was condensed in terms of both population and business activity sites thus it was quite logical to reconstruct as what is used to be. However, Tohoku in this case is quite different, how the region geographically extends and how the structure of the industry extends.



Moreover, as pointed out by Nikkei in its article issued on March 25, the “natech” disaster shed light upon the contradictions and weaknesses of Japan system. They are the fact that the regions in which functions/systems of healthcare, government and lives are dispersed when the country was facing decreasing and aging population and the reality that the country operation and management have been centralized in Tokyo when the electricity supply of Tokyo relied from local regions.



5. Companies/organizations and people need to get back to work as soon as possible



Nikkei online article reported on March 25 that more than 1,000 listed companies in Japan are affected by the disaster, large or small. The most affected are in general of automotive and electronic manufactures because many of they have core plants in Tohoku area and they have been unable to operate. Such plants include those that produce and supply core components to worldwide market and already is pointed out by worldwide media that it would affect many global companies operating outside Japan.



Of course, smooth reconstruction already mentioned to reconstruct global supply chain network as Kishi mentions would be the requirement.



5. And, consumption is also a requirement to get everything going



Events and entertainments are currently restrained voluntarily but excessive voluntary restraints would be a negative factor for smooth recovery. General construction industry is likely to benefit from reconstruction as long as the government would give clear direction and support the industry; however, construction industry alone cannot drive economic maintenance and growth. Consumer spending is a requirement to drive economy and thus it is wise not to excessively restraint events, entertainments and so forth. This was pointed out and discussed in a few recent online articles in Japan’s leading business media.



6. The author’s final thoughts – The country and its citizens are strong enough to make the third miracle a reality



It is true that people suffered directly and indirectly from the disaster were first shocked and was at a loss what to do but are now determined to do what they can and actually started to take proactive actions to recover and reconstruct. The author believes that the country and its people are strong enough to make the third miracle a reality.  Japan cannot possibly remain to be a big burden of the international community because of the disaster.



In fact, the recovery and reconstruction from the “natech” disaster are expected to be converted to an opportunity of eliminating the weaknesses and contradictions the country had, transform the total structure of society, economy and industry. In other words, this is to be a catalyst the country needed to boost its economy for decades.



Last but not least, the author would like to introduce an idea she happened to listen to and was extremely was compassionate, which was introduced in Kansai local TV evening news on March 25 in which they introduced some ideas of some audience of what people in Kansai can do now to help the east, suffering directly from the disaster. The author believes that this is the mindset and behaviour that we all need to have, together with integrity, flexibility and teamwork/collaboration, and that the fact that a normal citizen has courage to share such mindset and behaviour indicates that the country and its citizen have the strengths of realizing the third miracle to create a new country, although it might be a long journey.



It is that every individuals need to unleash their own skills, competencies and strengths in this urgent situation. For example, entertainers focus on entertaining people and athletes playing games to perform well, to encourage and inspire people including those in the devastated area and make them feel better. Of course, business person are to focus on their business while doing what they can to help the people in need, and rescuers health care experts in the devastated area, each people playing an active role and fulfilling his/her mission.





References:-

Kishi, Hiroyuki (March 18, 2011) Discussion on economy management after rebuilt of Japan (in Japanese)

http://diamond.jp/articles/-/11538

Kishi, Hiroyuki (March 25, 2011) Anxiety of hollow out of eastern Japan attributing to the natural disaster and nuclear plant issue and future of Japanese economy (in Japanese)

http://diamond.jp/articles/-/11613

Koya, Tomoyuki (March 17, 2011) Three crisis that companies suffer from the disaster – resource crisis, demand crisis and mind crisis (in Japanese)

http://business.nikkeibp.co.jp/article/manage/20110316/219006/　

Noguchi, Yukio (March 22, 2011) Reviewing basic rate of electricity for assumed electricity shortage this coming summer has much meaning (in Japanese)

http://diamond.jp/articles/-/11597





Resources:-

The natech (nature and technology) disaster is the most severe since the World War II and the economic loss from the disaster, direct and indirect combined, is enormous. However, Japan has made two miracles in its history, Meiji Revolution and recovery/reconstruction from World War II and the country and its citizen are strong enough to make the third miracle. The disaster is expected to be converted to an opportunity to transform total structure of society, economy and industry, to create a new country, thus a catalyst the country needed for decades to boost its economy.