This talk describes the challenges Japan confronts on energy and climate change as well as the reasons for Japan's comparatively weak, reactive stance towards these two intimately linked phenomena. Japan is generally regarded as a strong activist on the environmental and energy fronts, through conservation, global cooperation (e.g. the Kyoto Protocol), renewable energy, hybrid cars, and the like. For many, this progressive image makes intuitive sense: given Japan's high level of oil dependence, high exposure on the environmental front, and relative lack of extractive industries, one would expect Japan to be taking a leadership role in countering environmental and energy risks. Note also that energy is a USD 6 trillion market (10% of global GDP), affording ample opportunities for new growth sectors in the midst of the unfolding economic crisis. But in fact, Japan's efforts to leave the oil age are middling at best. The key problem here is institutional: an unwillingness to use the power of the public sector to shape market incentives. Hence this talk will explain the political economy of the gap between Japan's green image and its actual performance as well as the prospects for serious, sustainable "structural reform" and a Japanese “green new deal”.
Andrew DeWit is Professor in the School of Economic Policy Studies at Rikkyo University, Tokyo. Local public finance, political economy and risk studies are among his many research and teaching interests. On these topics he has published widely in English and Japanese. His most recent book is a co-authored volume with Masaru Kaneko on the energy and environmental revolution (Asupekuto, July 2007).