Japan’s World Cup is an economic stress test | Article – Asia Times

Japan’s World Cup is an economic stress test | Article – Asia Times

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The Japanese love a mascot.

Good luck finding a place – any place – that is more obsessed with cute, cuddly and often zany promotional characters. Cities, towns and prefectures introduce them. So do companies, non-profit organizations and the national police. Sports teams, too.

Rarely, though, do such mascots enjoy the ubiquity of “Ren” and “G,” the two lion-like creatures conjured up to promote the Rugby World Cup opening in Tokyo on Friday.

On the one hand, this colorful pair with button noses and long, flowing manes, depict Japan’s softer side. On the other, their omnipresence around the nation speaks to Tokyo’s bigger ambitions as 500,000 foreign fans funnel into a historically insular nation.

Show me the yen

The focus these next two weeks is on the US$4 billion-plus windfall that visiting rugby enthusiasts are expected to pump into the economy. At least 1.8 million tickets have been sold.

The real question that the event camouflages, however, is Japan’s ability to harness this moment to achieve Prime Minister Shinzo Abe’s broader efforts to recalibrate national growth engines away from the traditional economic engine, exports.

The Rugby World Cup, Asia’s first, is a dress rehearsal for the 2020 Tokyo Olympics, which begins 308 days after Japan faces off with Russia today. It is also a dry run, of sorts, for Abe’s desire to raise Japan’s competitive game.

Over the last five years, Japan has enjoyed a tourism boom. In the first half of 2019, the country saw record inflows of nearly 17 million, up 4.6% from the previous year (also a record).

Some cities, in fact, already worry they’re being overwhelmed – including the nation’s flagship heritage destination, Kyoto. Concerns include traffic jams, overloaded train stations, litter, cultural differences – you name it. In June, the Japan Tourism Agency reported that more than 30% of cities face a shortage of accommodations and more than 38% suffer extreme traffic congestion.

And this is well before influxes of rugby fans and Olympic ticket holders.

Full of challenges

This embarrassment of riches has many causes.

One is a 30% drop in the yen since 2012, which made Japan more affordable. Japan is as safe, efficient and clean a place as travelers will find. Prime Minister Abe’s team deserves credit for simplifying visa procedures. It rolled out a tax-free shopping infrastructure that is surprisingly unbureaucratic by Japanese standards.

Yet a few growing pains are getting in the way.

One is the mindset. Talking with executives and perusing survey data, one gets the distinct impression that much of Japan Inc. sees today’s tourism boom as transitory. Many figure that a yen surge, or the fickleness of consum

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