World Economic Forum Annual Meeting 2013: Part 6, the Final Day

(To convey the exciting atmosphere of the meeting, I will release this part by revising my Twitter messages.)

I got up a little after 6am as usual, leaving the hotel a little after 7am. It was still dark outside. Today, Japanese ministers, economy minister Amari and trade minister Motegi, will take the stage. I will also preside over a session. Walking to the venue, I gave myself a pep-talk, as I always do before important tasks.

From now Prime Minister Abe is going to offer a speech via the Internet. Inside the venue, leading figures have already assembled, including ministers Amari and Motegi, Ms. Sadako Ogata, Mr. Yasuchika Hasegawa, the Chairman of the Japan Association of Corporate Executives; and Mr. Yorihiko Kojima, the Chairman of the Board of Mitsubishi Corporation. Among the advisers, I recognized Mr. Martin Wolf of The Financial Times, Mr. Gordon Brown, Mr. Angel Gurria, Secretary-General of the OECD, Mr. Muhammad Yunus, and many other leading figures. Now, Mr. Klaus Schwab has appeared. The meeting will soon begin.

On the screen, I see a scene from the plaza in front of Japan’s Imperial Palace. Prime Minister Abe is expected to appear soon. Mr. Schwab stands up with a microphone in his hand, and the audience becomes quiet.

Mr. Abe then appeared in the center of the screen. After saying a few words, Mr. Schwab handed the microphone to Mr. Heizo Takenaka, who introduced Prime Minister Abe. Standing in front of the Imperial Palace, Prime Minister Abe began speaking. “Japan has the potential to change the world. It’s important to release Japan’s power. To do so, we must have a strong will and determination to grow our economy.”

“I call the essential policies for growth, the ‘three arrows.’ They comprise a monetary policy, a financial policy, and a growth strategy. Deregulation is also important. Although Japan’s population is decreasing, we can grow our economy by discovering seeds of growth and carefully growing those seeds. Professor Yamanaka at Kyoto University, for instance, was awarded the Nobel Prize for the discovery of iPS cells. Such a discovery can be a great seed for future growth. To ensure the growth of Japan’s economy, however, we definitely need to act in a timely manner. In addition, we must reinforce our fight against terrorism.” The prime minister’s tone was strong and very impressive.

When he concluded his message with this remark, “You can expect the revival of a strong Japan,” the audience gave a big round of applause. Mr. Schwab asked Mr. Abe about the independence of the Bank of Japan. Mr. Abe replied, “There is no problem, since the decision was made autonomously by the Bank of Japan. If there is one point that is new, that is the fact that the Bank of Japan has announced that it will promote policy coordination with the government.” With this statement, the relay from Japan completed.

Following the Prime Minister’s message, discussions began at the venue. Regrettably, I cannot introduce them to you because they are not for publication. In any case, I highly value the efforts of the organizers of the WEF and the Prime Minister’s office to enable the relay program. I’d like here to express my gratitude to the staff members who serve in WEF and the office of the prime minister.

Now, the “Japan Panel” will begin. Sir David Wright, former British ambassador to Japan, will serve as a moderator. Panelists are Minister Motegi, former minister Heizo Takenaka, Mr. Yasuchika Hasegawa, the chairman of the Japan Association of Corporate Executives; Professor Kiyoshi Kurokawa of the National Graduate Institute for Policy Studies, and Mr. Yoshimitsu Kobayashi, president of Mitsubishi Chemical Holdings Corporation. Among the audience members, I recognized many leading figures, including President Atsushi Seike of Keio University, President Takeshi Niinami of Lawson, Inc., and Honorary Chairman Akira Kiyota of Daiwa Securities Group Inc.

Now the Japan Panel is over, and it is time for me to take the stage. In this private session, I will take part in brainstorming regarding the theme of this year’s Annual Meeting of the New Champions (also known as the Summer Davos). Today, my brain has been actively working since seven in the morning. At the beginning of the session, I will describe my own views and lead discussions. Finally, I will summarize discussions so as to share the views exchanged.

The session is over, and I have completed all official roles at this WEF Annual Meeting. I decided to take a rest in the lounge. In the men’s room, I happened to see Minister Amari so we exchanged greetings. While I was having tea at the counter in the lounge, the president of Harvard Business School approached me and said, “I’m sorry, I was not able to attend the GLOBIS Night.” I was impressed by his courtesy.

So my official role is over. I will enjoy my time in Davos to my heart’s content. During lunch, I enjoyed talking with friends. After lunch, I attended a session in which Mr. Daisuke Iwase of Lifenet Insurance Company was taking part.

Mr. Iwase made his debut at the WEF Annual Meeting. Mr. Deguchi prepared this slide using the gestures of Mark Zuckerberg.


At last, the keynote session titled “The Global Economic Outlook” began with the presence of Minister Amari. Other panelists included Christine Lagarde, managing director of the IMF, Mark Carney, governor of the Bank of Canada, who has been appointed as the next governor of the Bank of England; and Angel Gurria, secretary-general of the OECD. Martin Wolf (The Financial Times) served as the moderator.

When Mr. Wolf introduced Minister Amari, he explained Abenomics, describing it as “revolutionary.” Minister Amari further explained Japan’s policy of the “three arrows” with particular focus on the growth strategy. “Our utmost priority is getting rid of deflation. We will get Japan’s primary balance into the black by 2020. By reviving the Japanese economy, I hope to present a good model for other countries,” he said.

The top official of the OECD asked a series of questions: “What will you do with the TPP? What about the competitiveness of the agricultural sector? What will you do about the energy problem? Do you plan to resume nuclear power generation? What will you do to tackle Japan’s budget deficit?” I understand that major challenges for Japan are issues concerning the TPP, resumption of nuclear power plants, and budget deficit. We must adopt solid policies and explain them thoroughly to the international community.

Next, Mr. Wolf asked Minister Amari, “What do you think of the independence of the central bank? How will you respond to criticism towards the policy of letting the yen fall?” Minister Amari answered, “This is the first time that the government and the Bank of Japan share the same goal for inflation. The inflation target of 2% is in accordance with the global standard level. The Bank of Japan will continue to maintain its independence, and it has set the target autonomously.
Japanese ministers have never made any remarks concerning currency exchange rates. Instead of exchange rates, we are discussing policies. The present depreciation of the yen is a result of the money-easing and other policies we take. Because of deflation, Japan’s nominal growth rate has remained at the same level over the past 20 years. So the government intends to create actual demand by increasing public spending, in order to encourage the private sector to increase investment. As the third economic power in the world, Japan hopes to fulfill its role to lead global economic growth.” I think his reply was excellent.

Finally, Governor Carney of the Bank of Canada explained Japanese policies and positions on behalf of the Japanese government. His explanation was much more effective and persuading, since his remarks reflected the view of a third party. It was a very impressive moment when Governor Carney and Minister Amari greeted each other on stage. I believe that Japan’s policies were understood well at the WEF Annual Meeting. I thank Minister Amari for his good job.

I truly believe that Japanese politicians should participate in WEF Annual Meetings. Only three people from Japan can stand on the main stage in Davos: the financial minister, economic minister, and the governor of the Bank of Japan. Although many people come in a private capacity, like me, we can attend only sub-sessions, but ministers can stand on the main stage. Needless to say, their statements have much greater influence than ours.

If no ministers or the governor of the Bank of Japan attend the meeting, Japan will lose its presence from the main stage. This will result in a trial in absentia; Japan will be criticized, but will not be able to make rebuttals. Since global opinion is created during WEF Annual Meetings, Japanese ministers must attend WEF Annual Meetings by all means.

Now all sessions of this year’s WEF Meeting are over. The only remaining program is the soiree, which will be held for the first time in the WEF’s history at a hotel on the mountaintop. For the first time in Davos, I have been staying at a hotel with a swimming pool, but I have been too busy to swim. So I decided to enjoy a swim at the pool before attending the soiree.

The soiree is now over. It was held at a historic hotel on the mountaintop. I am now in my hotel room. All programs of the WEF Annual Meeting are over. Beginning on Tuesday, the event lasted five days. The climax of the event was on Thursday, when we organized GLOBIS Night. Subsequently, the number of participants began to decrease gradually. Tomorrow (Sunday) morning, I will return to Zurich, from where I will fly to London. My journey will continue in the coming days.

February 1, 2013
At home in Ichibancho, Tokyo
Yoshito Hori