Outside In | Has spring finally arrived for Japan’s zombie economy?

Japan’s economists are calling it “the true dawn”: a glimmer of real hope that, after two decades of zombie growth, Japan might at last be stirring back to life.

You could put it down to the inevitable springtime optimism that coincides with the sakura blossoming season – which came to Tokyo on March 17, among the earliest on record, and was therefore all but finished when I flew into Narita last weekend. 

When I last looked in any detail at Japan’s prospects, I sensed an existentially challenged community. Not only had economic growth stalled since 1990, but rapid ageing signalled the prospect of demographic decline, with the country’s working population shrinking sharply, and the total population expected to slump from 127 million today to around 87 million by 2065. The security of lifetime employment was evaporating, and high costs created a sense of uncertain future competitiveness. Anomic youngsters were recoiling into computer games and cosplay.

The country’s century-long assumption that it was Asia’s No 1 is being challenged by the awesome growth of China. The alliance networks flowing back to the US were looking frail and worn – all the more so since Donald Trump arrived in office with his “America first” mantra.