China vs. Japan: Asian Powers in a Changing World
While the world has been engrossed in the narrative of China's meteoric rise, a question emerges: Have we underestimated Japan's quiet reinvention?
Japan Satellite Map. Google Earth.
China, with its gravity-defying 9% annual development, has been the poster child of a brand of globalization that, frankly, is now out of vogue. But is China really the definitive success story?
Ray Dalio, The Big Cycles of China and Its Currency
Looking back at history, China is merely replicating patterns of ancient dynasties. Xi Jinping, recognizing a cyclical pattern, warns of an impending "storm of a century." Despite its dizzying growth, the Chinese titan now finds itself at a crossroads, facing debt challenges reminiscent of Japan in the 90s. The globe worries about inflation, yet China is experiencing deflation.
Now, the world is in disruption. The old rules of globalization are crumbling, and amid this chaos, Japan is quietly re-emerging, poised to challenge China's hegemony. Why? The reason is simple: robotics, automation and NECESSITY.
And isn't it ironic? Japan, a country often written off due to its declining population, might just have the last laugh. Their historic prowess in innovation isn't just a nostalgic footnote; it's their secret weapon.
Yet, let's dive deeper than just tech. Japan's very challenges - demographic shifts, the looming shadow of China, and an insatiable thirst for sustainable energy - aren't just obstacles. They're catalysts. They’re the burning platforms pushing Japan not just to adapt, but to lead. In a world obsessed with growth at all costs, Japan’s story might just teach us that sometimes, necessity (and not sheer numbers) is the true mother of invention.
Source: Statista
The indicator we should all be looking at is not just the performance of the Hang Seng Index against the Nikkei but the disruptive potential of the latter. Since 2013, if you bet on Japan, you won.
Relationship between the Hang Seng Index/Nikkei in USD.
Japan isn't just watching; it's acting. With its vision of the "Society 5.0", Japan is shaping the future: energy self-sufficient cities, powered by AI and the Internet of Things. While other countries are ensnared in past politics, Japan is forging a new narrative for the 21st century.
In summary, in this Asian chess match, while everyone has been watching the Chinese king, the samurai knight has been making its silent and strategic move. And perhaps, just perhaps, it's poised to deliver checkmate.
Guillermo Valencia A
Brazil, August 21st 2023