Weekly Update: News on Japan & the Netherlands – Week 37, 2020

Abe is stepping down due to health concerns before his term as LDP president ends in September next year. The leadership election will be held next Monday 14 September, and the new prime minister will be installed at an extraordinary Diet session to be convened on 16 September.

Suga, who is widely seen as the front-runner in the race, reiterated his stance to carry on Abe’s policies as someone who has long supported the administration as the top government spokesman. “I will carry on the works of Prime Minister Abe and hope to move them forward further,” said Suga.

He called for eliminating sectionalism at ministries and creating a digital agency as the coronavirus pandemic has underscored the need to facilitate online medical examinations and administrative procedures as well as education using advanced online technology.

While Suga has secured the backing of the majority of 394 LDP lawmakers who will vote, the focus of the election is also on how many votes Ishiba and Kishida can attract as the election serves as a bellwether for the next presidential election to be held by the end of September next year.

Ishiba is seeking a departure from Abe’s policies, saying he wants to reset Japan and “rewrite its blueprint.” The country cannot survive the next era without it, Ishiba said. He said he will decentralize the Tokyo-centric economy and create a disaster management agency, saying the disaster-prone country needs a unified response system.

“I have realized the significance of the ability to listen to the people in politics,” said Kishida. He praised Abe’s achievements in the economic and diplomatic fronts but called for addressing the income gap in Japan, pledging to raise the minimum wage and reduce education costs.

The party has decided to hold an abridged version of the leadership election this time to pick a successor as quickly as possible as Abe is stepping down in the middle of his term amid the current challenges in responding to the coronavirus pandemic.

If the election were held under usual procedures, candidates would have needed to secure a majority of the 788 votes up for grabs, with Diet members and rank-and-file members holding 394 votes each.

But the scaled-down version will be held with the 394 Diet member votes and a total of 141 votes cast by three delegates each from the party’s 47 prefectural chapters. Most of the local chapters are holding primaries.

With the pandemic, as well as a powerful typhoon, hitting southwestern Japan, the candidates will refrain from taking part in debates or from giving outdoor stump speeches. They have instead been presenting their policies online and through appearances on TV programs.

Even as the typhoon headed for the Korean Peninsula, the Japan Meteorological Agency warned of torrential rain, strong winds and tidal surges in some areas, urging people across a wide area to remain vigilant.

Major mobile carriers NTT Docomo Inc., KDDI Corp. and SoftBank Corp. said their networks were disrupted in areas of Kyushu, as well as the western regions of Shikoku and Chugoku.

The task force meetings over the next several months will deal with issue like getting athletes into Japan, COVID-19 testing, measures to keep venues safe, anti-virus measures at the Athletes’ Village, immigration issues and the status of fans. A statement outlining the schedule of five meetings said an “interim summary is planned by approximately the end of 2020.”

“As far as spectators, we don’t have any conditions yet, but we’d like to avoid no spectators,” Muto said. Japan is facing a major challenge, with the public skeptical the Olympics can take place — or should take place. Japan has already invested billions, and the delay is likely to cost billions more.

A poll last month of almost 13,000 Japanese companies showed 53.6% want the games canceled or postponed again. The IOC has said if the Olympics can’t happen in 2021, they will be canceled. A poll in July found that two-thirds of the public also favors another postponement or cancellation.

“While living with the coronavirus, we need to make sure that athletes can perform at their best and audiences enjoy the games safely,” deputy chief cabinet secretary Kasuhiro Sugita said at the meeting. “To achieve that, we will adjust border controls, testing and medical systems and the operations of the venues.”

“Pride House Tokyo aims to educate the world and also Japan of the difficulties the LGBTQ community has playing and enjoying sports, while helping create a safe space for the community too,” Pride House Tokyo said in a statement on Monday.

It is traditional for most nations competing at the Olympics to have a hospitality ‘house’, where they promote their country and hold parties for winning athletes. Gon Matsunaka, the head of Good Ageing Yells, one of the organisations supporting the project, said Japan lags behind many other developed nations when it comes to LGBTQ rights.

“Many people might think that Japan is a human rights defender, but actually there are no laws to protect LGBTQ people,” Matsunaka told Reuters via email. “Society is filled with prejudice, discrimination and harassment towards LGBTQ community.”

“While we have to change the sports arena, we also hope Pride House Legacy can help change society as a whole as well.” Gay marriage is illegal in Japan and although about two dozen cities, towns and wards issue same-sex partnership certificates, they lack legal standing and prejudice persists.

Fumino Sugiyama, a former fencer for the Japanese national team who now identifies as a man, said little had changed in 15 years since retiring from professional sport. “Even now looking around, there are few LGBTQ athletes that live their lives openly and that is the reality here in Japan,” Sugiyama told a news briefing to launch Pride House Tokyo.

The relaxation of the rule comes as part of government efforts to revive the pandemic-hit economy. The move would coincide with a four-day weekend in Japan starting from 19 September.

Economic revitalization minister Yasutoshi Nishimura said last month the government might relax the restriction before the end of September if the daily number of new infections substantially decreases.Event operators and spectators will be required to take thorough measures to prevent both the resurgence of the virus and spread of seasonal influenza, said the sources.

Nippon Professional Baseball and the J.League, Japan’s professional soccer league, jointly submitted their request to ease the spectator cap to the government on Tuesday.

The heads of the two leagues said at a joint press conference that they are asking to raise the maximum attendance to 20,000 spectators or 50% of a venue’s capacity, whichever is less.

The government initially planned to ease the limit on 1 August, but it was later extended to the end of August and then to the end of this month as the country struggled to contain the virus.

At Friday’s meeting, the health experts may also discuss whether the government can add trips to and from Tokyo to its travel subsidy campaign, according to the sources. Such trips have been excluded from the controversial Go To travel campaign, launched in July to revive the domestic tourism industry, as the capital has seen a much higher number of daily infections than other prefectures.

As part of measures to fight the virus, the cabinet decided Tuesday to use 671.4 billion yen in reserve funds to purchase coronavirus vaccines currently being developed by drugmakers, Finance Minister Taro Aso told a press conference.

The world’s third-largest economy shrank an annualised 28.1% in April-June, more than a preliminary reading of a 27.8% contraction, revised gross domestic product (GDP) data showed on Tuesday, suffering its worst postwar contraction.

The data will put the new prime minister, to be elected in a ruling party leadership race on 14 September, under pressure to take bolder economic support measures.

Chief Cabinet Secretary Yoshihide Suga, the frontrunner to become next premier, has signaled his readiness to boost spending if he were to lead the country.

“The risk ahead is that the effect of measures taken so far, such as pay-outs to households, will peter out,” said Koichi Fujishiro, an economist at Dai-ichi Life Research Institute. “If COVID-19 weighs heavily on wages, the new administration could take additional steps to help households.”

Japan’s economy has shown some signs of life after suffering three straight quarters of contraction, with factory output rising in July at the fastest pace on record thanks to rebounding demand for automobiles.

Yet separate data on Tuesday suggested any recovery will likely be modest, as household spending fell a bigger-than-expected 7.6% in July year-on-year, while real wages declined for the fifth straight month, pointing to more pressure on consumer spending.

The health crisis has ravaged a broad array of sectors, with firms such as automaker Honda Motor Co forecasting a 68% decrease in annual operating profit.

Analysts polled by Reuters in August said they expect the economy to shrink 5.6% in the current fiscal year to next March, and grow just 3.3% the following year.

The global and domestic business climate has many Japan observers predicting a long and bumpy road to returning the economy to pre-COVID levels. “It will probably take a long time for the economy to normalize and return to levels before the pandemic,” said Yoshiki Shinke, chief economist at Dai-ichi Life Research Institute.

Last week, Prime Minister Shinzo Abe said the government wants to secure vaccines for all citizens by the first half of 2021 as part of a set of measures against the virus, which causes the COVID-19 respiratory illness.

Under a plan that is currently being discussed, the government is considering prioritizing medical workers, the elderly and people who have underlying illnesses. Municipalities will be in charge of offering the vaccinations, the sources said. Vaccines against the virus have been under development in many countries, with some now in the clinical trial stage.

Since there are no data from the trials showing the effectiveness or the degree of side effects depending on the age or health conditions of those vaccinated, some government officials have been opposed to differentiating the financial burden among people.

The government is considering having the vaccine purchases be financed by reserve funds from the budget for the current fiscal year to March 2021.

Health minister Katsunobu Kato said Wednesday the government has been discussing how to create a necessary system to administer the vaccines. “We will draw a conclusion about the financial support depending on our discussions and the nature of the vaccines,” he added.

Kato said Tuesday that Japan will join an international framework, co-led by the World Health Organization, which aims to guarantee equitable global access to potential vaccines.

A government panel of health experts, however, has indicated the difficulty of developing an effective vaccine, saying, “There is no guarantee that an ideal vaccine will be created in terms of both safety and effectiveness.”

The government is also expected to decide how to cover the cost of compensation that vaccine manufacturers may face if health issues occur before the shots will be offered to people.

The dip will come later than Rabobank first expected. In the previous quarterly report, the start of the dip was already foreseen in the last quarter of 2020. That it takes longer is probably due to the government’s corona support packages. These keep employment, at least among potential home buyers (aged 25 and older), still reasonably stable.

But people will eventually lose their jobs, or at least worry about losing their jobs, Rabobank said. Investors will also be more cautious. And this will result in sales falling from 220 thousand houses sold this year, to 190 thousand next year.

The bank also pointed out that a relatively large number of starters, younger people just starting out on the housing market, are buying a house this year. This may be because both investors and people selling their house to buy a new one are more reluctant due to the economic downturn, giving starters more opportunity. The same thing happened at the beginning of the 2008 credit crisis, the bank said.

Schiphol says it wishes to follow the guidelines of the European aviation authority EASA and the ECDC, the European equivalent of the RIVM. A general duty of masking should also provide more clarity for travelers.

In addition, Schiphol will maintain the existing corona measures, such as mudguards and an announcement that reminds travelers that they must keep sufficient distance. Markings for walking directions have also been applied to all floors. Travelers from orange areas can have themselves tested in the special test street.

The masking obligation also applies in aircraft, but airlines are responsible for enforcing it. Children up to the age of 12 do not need to wear a mask.

This can be seen on bodemdalingskaart.nl , where, thanks to satellite measurements, subsidence is shown accurately to the millimeter. According to TU Delft, the updated map also shows that the impact on roads, bridges and railway lines is greater than previously assumed.

“We see a lot of large infrastructure subsiding in all kinds of places”, says Delft professor Ramon Hanssen. Older constructions in particular can be endangered. “We have to start where it is most needed and for that these measurements are very important,” says Hanssen.

Last week, the Dutch cabinet was advised to do more against soil subsidence in peatlands, but now it appears that homeowners in sandy areas in the north, east, but also in parts of Brabant are also affected.

Two years ago, there were reports of foundation problems in 60 municipalities, that number has now risen to 180. This is confirmed by the Knowledge Center Approach to Foundation Problems KCAF, reports the Volkskrant.

Subsidence used to be a concern for residents of houses with wooden posts. “But houses with a foundation of steel or concrete are also experiencing problems these days,” says director Dick de Jong. The KCAF estimates that one million homes are in danger of subsiding. It costs about 70,000 to 80,000 euros to rebuild a house.

The new subsidence map is accessible to everyone. Hanssen hopes that as many people, companies and organizations as possible will scrutinize the situation in their area. But he does stress that the interpretation of the data can be difficult. “It is therefore wise to let an expert take a look if you want to know what effect it can have on your home.”

Companies, organizations and other parties can nominate a project with the Ministry it will fall under. The Ministry will officially submit the application to the independent committee for approval. Proposals must need at least 30 million euros. No upper limit was set.

Hoekstra already said last year that he wants to take advantage of the current low interest rates, which make it cheap for the Dutch government to borrow money. The coronavirus crisis both delayed plans for this fund, and showed how important such a fund is, the Ministers said on Monday.

“It underscores the importance of building up buffers in good times, so that investments can be made in bad times instead of budget cuts,” the Ministers said. Things like the aging population, climate change, and more limited productivity can also hinder growth for the Dutch economy. This National Growth Fund is intended to be a counter balance for setbacks like that.

“In order to maintain and increase prosperity for the next 20 to 30 years, the economy must grow faster and differently. That is necessary in order to be able to pay for healthcare education and pensions in the future and also to have money left over for the household wallet,” Wopke and Wiebes said.

More details about investment plans will be announced at the annual State of the Economy address in February. The Ministers hope to allocate the first projects for funding before the end of the Rutte III government’s term, which ends with the parliamentary elections in March next year.

General education union AOb confirmed to the Telegraaf that schools are struggling to get their ventilation systems in order. “We hear stories from our members about school books that got rained on because the windows are open wide all day long,” AOb spokesperson Esther Sloots said. “We are concerned about this, especially since the ventilation industry has already indicated several times that it will not be possible to check all systems before October.”

Benefit recipients and pensioners will also benefit, as state pension and social assistance benefits are linked to minimum wage. The SP wants to pay for this extra government spending by increasing tax on millionaires and big companies. “As far as we are concerned, it is time for a new economy in which everyone gets their fair share,” SP leader Lilian Marijnissen said.

The demand for salespeople, caregivers, and cleaners increased the most in recent months. In absolute numbers, the profession of baker saw the biggest increase in the number of vacancies, followed by delivery workers and weekend help.

The Indeed researchers also noted that five of the ten professions that saw the highest increase in vacancies are in the retail sector. According to the site, this shows that shops and supermarkets are recruiting again. The only sector that did not see an increase in vacancies in August was the construction and installation sector.