In November, headlines touted a free-trade deal signed by Japanese Prime Minister Junichiro Koizumi and Philippine President Gloria Macapagal-Arroyo as a move towards an enlightened policy on foreign workers. On closer inspection, however, Japan continues to hold the rest of the world at bay, even as a looming population crisis threatens to send the world's second-largest economy plummeting down the economic league tables. Most observers believe that the trade deal will allow, at most, a few hundred Filipino nurses to work indefinitely in Japan, provided they pass a proficiency test. The Philippines, which relies on remittances from roughly 8 million of its citizens abroad to prop up its economy, would obviously prefer that Japan accept more. Not only has Japan stalled on this request, but the justice ministry announced cuts in annual entertainment visas to Filipinos from 80,000 to 8,000. Tokyo's new 'enlightened policy' on immigration will result in fewer foreigners. Japan's stingy, muddled solution to the Filipino visa problem symbolises the country's general approach to foreign labour. Conservative bureaucrats sometimes present the country as a sort of hermetically sealed racial club, at risk of being contaminated by outsiders. Its current foreign labour force, at a fraction of 1 per cent, stands in stark contrast to Australia (24 per cent), the US (16 per cent), and Britain (5 per cent). Further, Japan only accepts roughly 10 asylum seekers each year. Unique among the advanced countries, it has not taken in a single Kurdish refugee, despite its support for the Gulf war, which led to the flight of hundreds of thousands of Kurds from northern Iraq. As one UN official said: 'Japan wants all the benefits of globalisation but none of the headaches.' After years of holding back the foreign hordes, however, Tokyo must finally accept that it may need immigrants - lots of them. With consistently decreasing birth rates, the population of 127 million is set to plummet to just 100 million by 2050, shrinking its labour pool and dragging down national wealth. Meanwhile, Japanese life-expectancy rates continue to increase, meaning the contracting workforce will be asked to support a growing army of pensioners. This is a system heading for collapse. Japan, of course, is hardly unique in struggling to deal with the demands of a globalised world, but it is increasingly out of step with other developed countries, most of which have well-integrated foreign populations and laws to protect them. The clock is ticking. Japan has a history of massive policy reversals in times of national crisis, and may yet decide to relax its emigration laws, drop its unofficial quotas on foreign workers, accept more refugees, and introduce an anti-discrimination law. But it needs to act soon. David McNeill teaches at Sophia University in Tokyo Reprinted with permission from YaleGlobal Online http://yaleglobal.yale.edu