Japan is not providing Asia with the support that North America is providing to Latin America or the EU to emerging Europe. With the US economy slowing down, more support from Japan is needed to maintain the momentum of the Asian recovery.
Prior to the financial crisis, Asian exports to Japan were outperforming overall Asian exports and Japanese exports to Asia were overperforming overall Japanese exports. Exports to Japan represented about one-fifth of total Asian exports and exports to Asia about 40% of total Japanese exports.
With the crisis, the trade relationship between Japan and Asia has become less favourable to Asia. The 1998 output collapse in East Asia resulted in lower demand for...
