Norbert Gehrke
Aug 9 · 3 min read

Let’s take a couple of minutes to look at Japan through a few key charts.

Population

Japan’s population is ageing fast and shrinking.

While the bell curve looks dramatic, it still projects a population of approximately 120 million people in 2030, down from 127 million today. Some reports claim that Japan’s total population could fall by as much as 30% to around 87 million by 2050, which would be much more severe than this graph projects.

As a result, by 2050, there will only be 2.1 workers supporting an aged dependent, compared with 3.9 in 2000 and 5.8 in 1990.

Economy

For an even slightly decreasing population, GDP growth has held up surprisingly well, i.e. has remained positive.

A key to ensuring continued GDP growth will be the raising of worker productivity, especially in the services sector. Alas, recent trends have not been favorable.

Inflation has been in a near-zero or even negative interest rate environment for more than 20 years. The “lost decade” has turned into the “lost quarter century”, despite all efforts by the Bank of Japan, which holds approximately 70% of all ETFs on the Tokyo Stock Exchange.

As a result, prices have barely budged over the last 20 years. I came to Japan for the first time in 1997, and most items still cost the same as then, to the surprise of many friends. The graph below shows this succinctly. Unfortunately, with low prices and inflation, salaries have hardly changed either.


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Norbert Gehrke

Written by

Passionate about strategy & innovation in Japan. Connector of people & ideas.

Tokyo FinTech

一般社団法人 (General Incorporated Association) Tokyo FinTech is registered as a non-profit organization in Japan, promoting the domestic ecosystem through innovation

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