Until a few years ago, I used to visit Tokyo regularly.
For some reason, those visits most often fell on the 26th.
That was the release date of Hanada and WiLL, monthly magazines that are essential reading not only for Japanese citizens but also for people around the world.
Thanks to them, the two-and-a-half-hour Shinkansen journey was a pleasure rather than a chore.
I could read both magazines on the outward and return journeys.
The following is an essay by a man who was born and raised in China, studied at Peking University and Kobe University, and subsequently had his eyes opened to Japan in Arashiyama, Kyoto.
Shi Ping, who has a Japanese wife and became a naturalized Japanese citizen, is one of the world’s foremost authorities on China.
This essay, too, demonstrates that fact.
China Will Not Become a “Second Japan.”
Recently, as the sinking of China’s economy has become increasingly certain, the argument that “China will not become a ‘second Japan’” has spread among Chinese people.
In other words, however much China’s economy declines, it will not suffer the kind of disastrous conditions Japan experienced after its economic bubble burst.
For example, in an interview this March with the Japanese business magazine Zaikai, Chinese Ambassador to Japan Wu Jianghao mocked Japan by stating, “China will not become a ‘second Japan.’”
As the ambassador of the country that gave us the four-character idiom “Yelang zide”—arrogantly overestimating oneself—it is understandable that he should make grandiose claims without knowing his own limitations and make a spectacle of himself.
The problem is that Japanese “experts” and media outlets are repeating that argument verbatim.
We must firmly refute it so that the Japanese public will not be misled.
However, this column reaches the same conclusion as the ambassador’s statement quoted above: “China will not become a ‘second Japan.’”
Of course, China does not qualify to become a “second Japan”; the point is that it could not become one even if it wanted to.
Japan has suffered a prolonged economic slump since its bubble burst in the early 1990s.
The fundamental difference between Japan and China is that, before experiencing the collapse of its bubble, Japan had already achieved world-leading technological standards and built up its core industries.
For example, in 1980, Japan surpassed the United States to become the world’s largest automobile producer, while its semiconductor industry accounted for 70 percent of the global market.
It was precisely this solid industrial foundation that enabled Japan’s economy to weather the prolonged stagnation following the bubble’s collapse.
In China, however, a property bubble emerged without the country having established core industries.
Until very recently, property development was a core industry accounting for as much as 30 percent of the economy.
That property bubble is now collapsing in China.
But what will remain after its core industry collapses?
In Japan, it is often reported that “China is now concentrating on electric vehicles and expanding its share of international exports.”
However, this is by no means the result of advanced technological capabilities.
It is a business built on appearances, supported by enormous government subsidies.
As expected, the United States and the European Union are moving to restrict imports of Chinese EVs because of those subsidies.
If American and European restrictions are implemented, China’s EV industry will suffer a devastating blow and quickly sink.
Let us look once again at gross domestic product per capita, the most important indicator of a country’s economic level and standard of living.
In Japan, GDP per capita exceeded $31,000 in 1992, immediately after the bubble burst.
This shows that Japan was one of the wealthiest countries in the world.
By contrast, China’s GDP per capita in 2023 was $12,541, less than 40 percent of Japan’s figure thirty years earlier.
Moreover, China’s wealth disparity is extremely severe, and the vast majority of its people are forced to live in conditions far poorer than the level suggested by “GDP per capita.”
At a press conference in May 2020, the late former premier Li Keqiang astonished the world by presenting the specific figure that “600 million people in China have a monthly income of 1,000 yuan, approximately 15,000 yen.”
However, because the economic crisis has worsened since then, the present situation is probably even more serious.
Think about it.
Can a country in which 600 million of its 1.4 billion people live on a monthly income of approximately 15,000 yen become a “second Japan”?
Such a question is absurd, with the answer clear from the outset.
I will state it clearly and unequivocally.
China will not become a “second Japan” after its property bubble collapses.
What lies ahead for China will not end with the collapse of its property bubble.
The entire economy will crumble, unemployment will rise further, and society will enter a period of profound stagnation.
As a result, there is a strong possibility of major social upheaval.
Since the beginning of 2023, there has been a sharp increase in cases of Chinese people, including members of the middle class, attempting to enter the United States illegally via South American countries they can enter without visas.
Some walk thousands of kilometers from South American countries to reach the United States.
What drives such extreme behavior must be the despair they feel about the bleak future awaiting their country.
How could such a country possibly become a “second Japan”?