The past few weeks have been of immense historical importance in Japan. After Emperor Akihito’s abdication at the end of April, having ascended the Chrysanthemum Throne in 1989, he is being succeeded by his elder son, Emperor Naruhito, Japan’s 126th emperor, who is steering the country in a new era.
Akihito was regarded as something of a pioneer, urging Japan to be open to the outside world. At a ceremony marking 30 years of his reign earlier this year, he highlighted the importance of globalization: “As the world has been globalized, I think we are now required to be more open to the outside, establish our own position with wisdom and build relations with other countries sincerely.”
Naruhito is set to follow in his father’s footsteps, as the pro-globalization emperor. This stance is consistent with a speech made last year by another hugely influential Asian leader, Chinese President Xi Jinping, who said, “Sealing off and excluding others is not the correct choice … China will not shut the door to the outside world but open more.… We’re going to ensure the fruits of development are shared.”
This open-minded, international approach by these Asian powerhouses is in stark contrast to that of US President Donald Trump. He is vehemently anti-globalization, and his protectionist policies are being further stepped up.
As the trade war between the US and China continues, Trump warned that tariffs on US$200 billion worth of goods would increase to 25% from 10%, overturning a decision made in February to maintain the 10% rate as a result of the progress made in negotiations between the world’s two largest economies.
As a result of Trump’s latest warning, global financial markets, which had forecast that a trade deal would be reached, nosedived. US equity futures fell by more than 2%, and stocks across Asia declined, with China’s main indices falling 5%.
As the inward-focused perspective by the US intensifies, coupled with Asia’s willingness to increase international alliances, it can be reasonably argued that the significant shift in the global sway of power and influence is certainly moving toward the east.
For well over a century the US has been the world’s largest economy, increasing to $20.4 trillion in 2018. However, over the past decade, the influence of China’s economy has thrived. A recent report by Standard Chartered predicts that Asian economies will grow substantially over the next 10 years, taking seven of the top 10 places on the list of the world’s largest economies by 2030.
The report went on to say that China could take over from the US at the top as early as next year, as analysts surveyed countries’ purchasing power parity (PPP), exchange rates and nominal gross domestic policy.
The report’s researchers stated that Asia would see major economic growth as economic output starts to match population size. “Our long-term growth forecasts are underpinned by one key principle: Countries’ share of world GDP should eventually converge with their share of the world’s population, driven by the convergence of per-capita GDP between advanced and emerging economies,” the report states.
As such, as Emperor Naruhito begins his reign in the world’s third-largest economy, and the ongoing shift in the world economies becomes more prominent, Asia looks to be edging ever closer to economic supremacy.