Can President Akuffo-Addo turn his admiration of Japan into policies that will transform Ghana?

Feature Article Akuffo-Addo of Ghana and Chinzo Abe of Japan. Credit to Getty images
DEC 20, 2018 LISTEN
Akuffo-Addo of Ghana and Chinzo Abe of Japan. Credit to Getty images

This article is organised into five parts: Introduction; the Meiji Restoration in 1868; learning from the West and implementing reforms; Post-WWII; Manufacturing and Export.

A. Introduction
In his recent three-day visit to Japan, President Akuffo-Addo appears to have been fascinated by the things he saw in Japan: the 320km per hour super fast bullet trains, the beautiful palaces, and globally dominant and technologically-driven automobile and electronic firms including Toyota, Nissan, Mitsubishi, Honda, Toshiba, Hitachi, Fujitsu, Mitsubishi Electric, Panasonic, NEC, Sony, Sharp, Canon, Sanyo, Nikon, Olympus, Epson, Pioneer, Daikin, JVC, Konica, Kodak, and Philips among others.

During a press conference in Japan, President Akuffo-Addo said "Ghana is a great admirer of the Japanese Model of Development and Japan’s technological advancements and I have informed the Prime Minister [Shinzo Abe] that we are looking forward to benefiting from the wealth of knowledge and experience to boost our development.”

President Akuffo-Addo then vowed to let Ghana learn from the Japanese development experience. He said "We want to emulate the story of the East Asian Miracle, which saw, from 1965 to 1990, the twenty-three (23) countries of East Asia, especially Japan, growing faster than all the regions in the world...Japan made the transition from poverty to prosperity, as we are attempting to do, by restructuring the institutions of her governance, modernising her agriculture to enhance its productivity, implementing a clear industrial policy, and rationalising the financial sector to support growth in agriculture, and growth in manufacturing and industry.”

The president is right to let Ghana emulate Japan. Since the Industrial Revolution began in England centuries ago, nations have always learnt from one another. In fact, that is what Japan did. In the 19th Century, the Japanese were equally fascinated by things they saw when their leaders visited the United States first in 1860 and again between 1871 and 1873. In the United States the Japanese saw railroads, steamship, gaslights, flush toilets, and weapons and vowed to learn and catch up with the Americans. They accomplished the catch up in less than 50 years (1868-1912) under the reign of Emperor Meiji. Since then Japan has surged ahead of all Asia, and is the third most powerful country in the world behind the US and China.

B. How Japan Developed: The Meiji Restoration of 1868

The story of how Japan surged ahead of the rest of Asia and became a great power begins in 1868 not 1965. Prior to 1868 Japan had sought to dominate northeast Asia by controlling Korea and China but were unsuccessful as the Chinese and the Koreans mobilised themselves and defeated the Japanese. As a result of its inability to control the region and hence the foreigners who were eyeing the country, Japan decided to impose total isolation on itself. The isolation lasted for more than 250 years. During the isolation period (1603-1867), Japanese military leaders beginning with Toyotomi Hideyoshi and Tokugawa Ieyasu banned all forms of contact between the people of Japan and the outside world. The punishment for citizens who breached the order was death.

However, the self imposed isolation did not help Japan. After 250 years of little contact with the outside world, Japan realised that the foreigners that they feared (the Americans, the Dutch, the English, the French, the Portuguese, and the Spanish) had become materially superior and more powerful economically and militarily. In 1853 for instance the Americans sent Naval Commodore Matthew C. Perry to force Japan to open itself up to foreign trade. The steamships and the weapons the Americans brought greatly amazed the Japanese. China was a powerful Asian country at the time, but the Japanese saw how the English humiliated the Chinese in the opium wars fought between 1839 and 1860. The Europeans had also conquered all the kingdoms in Asia from Cambodia to India. The Japanese sense of insecurity was maximised when in 1854, Commodore Perry came back from America with even a bigger fleet. In the early 1860s the threats finally reached home. In 1863, the British shelled Japan's southern port of Kagoshima. In 1864, a combined foreign fleet bombarded Japenese forces at Shimonoseki. The Japanese recognised that unless they did something fast they too would suffer the same fate like its neighbours.

Weak and powerless, the Japanese earnestly sought to save themselves from European colonisation, imperialism and subjugation. In 1867, a group of samurai officers decided to overthrow the military dictatorship (shogunate) that had governed Japan for centuries and had imposed the isolation on the country. The new officers decided to restore the Emperor Mutsuhito Meiji (who by then was a mere ceremonial figure) to his former glory. The Meiji Restoration and the officers who made it happen decided to modernise the country. They implemented sweeping reforms across all sectors of society: the economy, land, defence, government, institutions, and culture. Their aim was to catch up with the West economically and militarily at all cost.

C. Learning from the West and Implementing Reforms

To catch up with the West, the Meiji reformers sent Japan's leading statesmen to visit America and Europe to study how they had progressed so fast. One of such visits took place between 1871 and 1873, where about 54 diplomats, scholars, and politicians conducted knowledge tour in all Western cities. They learnt systematically and intensely Western achievements and practices such as defence, education, law, finance, banking, civil service and importantly science and technology.

The Meiji Reformers decided to quickly implement the findings of the statesmen. As the American journalist James Fallows observed, Japanese "imposed internal controls so that the newly acquired knowledge could be applied as quickly and efficiently as possible without corrupting what it thought of as the cultural essence of Japan; and it began constantly looking over its to shoulders to see how Japan stood relative both to the western powers it feared and admired and the Asian neighbours from which it was pulling ahead" (Fallows, 1995, p.87). They even brought in some of Europeans to advise them. For example "by the 1870s, the Naval Ministry was advised by 87 Englishmen; the Army by 46 Frenchmen; the Board of Construction by six Dutch experts; and Medical college by 11 Germans. Americans were present as missionaries, athletic coaches, and advisers on building a university system" (Fallows, 1995, p.93).

In 1872 Japan introduced universal education in the country. The public school curriculum was standardised around the country. Japan also initiated several infrastructure projects to boost the economy. In 1872, Japan began to construct railroads. The investment in railroads was so intense that by 1890 Japan had more than 1,400 miles (2,250 km) of rail. By 1880, Japan had also linked all its major cities with telegraph lines. After building the country's economic infrastructure, the country's leaders then turned their attention on building industries that could produce goods for consumption, export and for military use. They began with textiles, then steel, and ships. They developed and built their own weapons, and bought some from the West.

The investment allowed Japan to grow strongly economically and militarily which helped the country to defend itself against powerful adversaries. In 1895, less than 30 years after the reforms were initiated, Japan defeated China in the Sino-Japanese war and seized Taiwan from the Chinese. Ten years later, in 1905, Japan also defeated Russia in the Russo-Japanese war. It was the first time an Asian country had defeated European power. Japan managed to force Russia to relinquish its interests in Korea. Japan went on to annex and later colonised Korea in 1910. Russia's defeat forced the Western powers to recognise Japan as equal military and economic power.

When World War I broke out in 1914, Japan was a full-fledged military power and entered the war to expand its empire in Asia. Again in World War II, Japan entered the war this time to uproot the Europeans and Americans from Asia. Japan for instance drove the Dutch out of Indonesia. They occupied Singapore, China and several countries.

Though Japan was defeated in the war, how it conducted the war had profound impact throughout Asia. It hastened the independence of several countries in Asia including Burma, India, Indonesia, Malaysia and Korea. France lost her Indochina possessions. India had independence in 1947. In 1949 Indonesia gained independence from the Dutch. Shortly after the independence, one Indonesia politician told the American novelist Richard Wright that the Japanese could be credited for "one of the most decisive factors in [our] winning independence". Wright wanted to know what was the factor. The Indonesian answered: It was how the Dutch behaved when the Japanese came. They caved in. The Dutch were scared; they bowed; they wept; they begged; they all crawled...And we Indonesians said to ourselves, 'If the Dutch are that scared of the Japanese, then why ought we be scared of the Dutch'" (cited in James Fallows, 1995, p.110).

D. Post-WWII
After World War II, a few men at the top of Japanese society decided to rebuild Japan and its industries. They took advantage of the US Occupation of Japan and channelled money that should have gone into defence and security into rebuilding the country's shattered infrastructure and industries. As Lee Kuan Yew, former Prime Minister of Singapore pointed out in his book From Third World To First "When communist China intervened in the Korean War [1950-1953], the Americans switched their policy to one of rebuilding Japan. Japanese leaders realised this was their chance and kept a low, humble posture while they catch up with Americans, first in textiles, steel, ships, motorcars, and petrochemicals, then electrical and electronic goods, cameras, and finally computers” (see Lee Kuan Yew 2000, p. 521). During this period Japan moved quickly to protect her economy particularly "access to raw materials abroad, access to foreign markets, and the nurturing of powerful conglomerates in industry and finance that are big enough to perform stabilising roles in society" (Garten, 1989). Japanese companies were protected from excessive competition by outsiders. The government imposed serious restrictions on the ability of foreign firms to operate in the Japanese market all with the aim of helping Japan's firms to grow and mature.

In the early years of her development (beginning in 1868), Japan saw (and continues to see) technology as extremely critical to their development. They came to the realisation that a nation cannot be strong without advanced technology. As a result they committed themselves to learning from the West, researching and applying their knowledge to advance the interest of the country. The government's role from 1868 till today has been very crucial. For instance, in the early years of its quest to develop the Japanese merchants, and businesses lacked the financial power to build the infrastructure, set up the factories, and build the railroads. So the government stepped in and organised the needed financial and other resources.

As some authors have indicated, "Money was the most straightforward problem. Petty merchants hard boomed during the late Tokugawa years. But they couldn't be relied on to make the large scale investments--in railroads, engine plants, cannon works-- necessary to put Japan on a par with the outside world. They lacked any system for pooling their capital for such grand projects. If this work were to be done, the state would have to encourage it--which it did by creating, coordinating and protecting companies large enough to achieve the country's industrial goals. 'The consistent aim of successive governments from the Meiji Revolution onward was to build Japan into a strong country with a top-class military capability and a top-class industry--a country which could not be defeated by the advanced nations of Europe and America'" (Fallows, 1995, pp.94-95).

E. Manufacturing and Export
Japanese economic and industrial policies lay emphasis on manufacturing and exports. The Japanese hold the belief that in the long run a society’s well-being and its overall wealth are determined not by what it could buy but by what it could make. In strategic terms they believe that countries will end up being dependent or independent based on their ability to make things. In the Japanese view, Latin Americans, Africans, and other Asian societies were subservient to England and France in the 19th century and are still subservient today because they could not make the machines and weapons the Europeans could. “Developing productive power was in its self a reward: The forces of production are the tree on which wealth grows...A society’s worth as much as it could make not as much as it could buy” (Fallows, 1995, p.185).

While in the Japanese view manufacturing is good, they also hold the view that a nation's long-term wealth (in material terms), is greater if it controlled more advanced activities. For instance they believe that a country should make its own steel, rather than buy it from outside because producing steel will enable the country to make machine tools and making machines tools can also enable the country to make engines, robots, airplanes. If a country is able to make engines, robots and airplanes, its citizens and future generations will be more likely to make advanced products and earn high incomes in the decades ahead. This is why the Japanese have focused on the higher-end of the technological chain: advanced engines, robots, semiconductor, airplanes, artificial intelligence. This concept of producing and controlling more advanced activities explains why Japan developed so fast and has virtual monopoly in key technologies and sectors.

The Japanese have arrived at their current stage of development by prioritising manufacturing, encouraging savings, discouraging ostentatious consumption, restricting access to Japan's market, promoting research and development of science and technology, and emphasising export.

Darko Kwabena Opoku notes that "The state identified industries for selective promotion; it induced, even coerced, firms into such industries, offering them protection and finance on highly concessionary terms. The state also assisted in technology transfer process to raise local learning and capabilities. Further, it guided and promoted research and development skill formation. In undertaking these tasks, the price mechanism was deliberately distorted to achieve specific objectives. Such intervention, not reliance on market forces, was the critical factor in the East Asian miracle" (Opoku, 2010, p. 167).

Japan does not believe that a country with limited resources (money, human capital and natural resources) should spread these resources thinly across many industries, sectors and regions simultaneously. Rather they prefer an approach where the limited resources are used to develop strategic industries and sectors so as to have maximum impact on society. In other words they favour industrial policies in which few industrial champions are selected and then attention is concentrated on them to develop them into global players.

Japanese have a different perspective when it comes to borrowing for development. They see borrowing and the associated debt as a form of colonisation that must be avoided. Indeed during the early years of the Meiji reforms, the Meiji leaders realised they could borrow to finance their projects. This was the approach America adopted. The Americans borrowed heavily from Britain and used the money to finance roads, harbours, railroads and expand the farms.

The leaders who modernised Japan preferred a different option: encouraging savings at home and using the money to finance the projects. "The Meiji officials viewed this option [borrowing] as amounting to colonisation in another form. From the beginning of the Meiji era until the turn of the century, Japanese interests arranged only two loans from foreign banks, both of them in Britain. One loan, for nearly a million pounds sterling, was for construction of a Tokyo-to-Yokohama railway in 1870. The other, for more than two million pounds, was to fund a pension system for government employees (including a number of samurai) in 1873. Both foreign loans were quickly repaid" Fallows, 1995, p.95).

The above are the ideas and processes which have made Japan what it is today. The post-WWII Japanese economic success is credited to its leaders, government and the bureaucrats and the private sector all working for the good of Japan. Can Akuffo-Addo and his government translate his fascination of Japan into tangible policies that will transform Ghana?

By Lord Adusei
Opoku, D. K. (2010) ‘From a ‘success’ story to a highly indebted poor country: Ghana and neoliberal reforms’Journal of Contemporary African Studies, 28:2, 155-175

Fallows, J. (1995) “Looking at the sun: the rise of the New East Asian Economic and Political System”

Garten J. E. (1989) ‘Japan and Germany: American Concerns’ Foreign Affairs, Volume 68 • Number 5, pp.84-101

Yew, L. K. (2000) "From Third World To First, p. 521)