Japan quietly seeks global leadership niches

In the 1980s, the buzz here was about "Japan bashing" – the biting criticism of a country that was eviscerating America's postwar industrial dominance. This is still the world's second-biggest economy. But more recently, Japanese have spoken in bemused terms about "Japan passing" – shorthand for a country feeling overshadowed by a rising China and India.

Japan's meteoric economic rise never led to a parallel surge in diplomatic clout. But today, as a pacesetter in everything from green cars to pop culture, it seeks to carve out a bigger role in world affairs as a "soft power."

The country has had remarkable success in shifting the one-dimensional perception of Japan Inc. to a multifaceted image that many in the industrialized world are now hastening to emulate in key areas like energy innovation. Still, Japan's new emergence is closely tied to its ability to reform its domestic political structure and speak more surely on the international diplomatic stage – something far from certain at this juncture.

"Japan used to be [just] an economic superpower," says Michael Auslin, a resident scholar at the American Enterprise Institute in Washington. "Now it talks about being a social superpower. Japanese say, 'We're First World, but what kind of power are we?' "

Japan's promotion of a changed image was underscored earlier this year by the ascension – a cutesy gesture, perhaps – of a cartoon character, Doraemon, as the country's roving cultural ambassador.

The animated cat's job, said then-Foreign Minister Masahiko Komura at the March announcement, was to "deepen people's understanding of Japan so they will become our friends." For his part, Doraemon – who is as familiar to young people in Asia as Snoopy was to generations of young Americans – promised to share globally "what kind of future [Japanese] want to build."

To Kenjiro Monji, it's one small piece of a diplomacy that is crucial to that future – influencing the public as well as opinion leaders by presenting ideas and policies more effectively. Japan's director general of public diplomacy, he points to polls by the BBC this year that gave Japan the No. 2 slot in terms of positive image among global respondents.

"The image of Japan is very good, and not just in cultural areas. It is seen as contributing to stability as well," he says.

Still, Mr. Monji says Japan could do far more to capitalize on its deft touch with practical and whimsical technology alike as well as popular culture. He is enthusiastic about the startup of an English language TV broadcast – a BBC-like program by Japan International Broadcasting – that aims to reach most corners of the globe by March 2009.

Plans are also in the works to open more than 100 language centers around the world to spread the study of Japanese, an effort funded by the Japan Foundation. Cultural grant aid is another target.

But Japan's cultural dynamism stands in sharp contrast to its domestic political and dip- lomatic profile – one that hampers Japan's ability to wield clout in more traditional spheres of influence.

That's something Ichiro Asahina, an idealistic and animated 30-something official with Japan's Ministry of Economy, Trade, and Industry, hopes to change.

After a stint at Harvard's Kennedy School of Government, Mr. Asahina concluded that Japan's bureaucracy, long the destination for the best and brightest, was failing to help blaze a path out of Japan's domestic economic and political troubles.

He and like-minded colleagues started brainstorming how best to nudge change within Kasumigaseki, Japan's ministerial hub. In 2005, Project K, as the group dubbed itself, ratcheted things up – publishing a book that pitched mission statements, a national strategy office, and other reforms to help ministries become more dynamic and open to frank discussion. They developed an acronym – PEATH, for peace, environment, art, technology, and human resources – to describe where the group, which now claims some 50 members, thought Japan could be most influential.

Their activism proved a magnet for criticism – and plaudits. "Things are moving toward change," Asahina asserts, noting that their tome sold a surprising 10,000 copies. "Many Japanese young people want a stronger role for Japan in the world – we think Japan can do a lot for the world's prosperity."

For this generation, unlike their parents and grandparents, validation does not have to come from the West. They exude an assurance born of Japan's broad cultural reach, its environmental leadership (this is, they note, home of the Kyoto Protocol on climate change and the trendsetting Toyota Prius), and its industrial competitiveness. Their country's World War II history, while an issue, does not encumber them; many observers see them as pragmatic.

"They're practical on security issues," says Steven Vogel, professor of political science at the University of California at Berkeley, noting that young people tend to take for granted the existence of the Self-Defense Forces and are less opposed to a military role overseas than their parents. "[It's] not a shift to the right, but stems from the disappearance of [ideological] splits. They are unraveling old constraints."

The debate over what kind of global leader Japan wants to be is far from settled. But it's clear that its under-the-radar influence – relative to the attention China gets – is strong, and growing in some areas.

Japan is building, of course, on a strong base. It remains a key US security partner in Asia. A study this year by the Chicago Council on Foreign Relations ranked Japan ahead of China and South Korea in cultural, economic, diplomatic, and political influence in Asia.

Japan has fallen from its 1990s perch of top donor of overseas development assistance, but still ranks 5th worldwide. Its manufacturing prowess and energy efficiency are second to none; Toyota now vies with GM's as the world's No. 1 car producer. Millions of people around the world are huge fans of Japanese comics and animation.

In the coming year, a global financial crisis, threats to world shipping lanes, and a growing US focus on Afghanistan will test how Japan chooses to exercise its influence in the world.

Already, in the financial crisis, Japan has expanded its global footprint with the Nomura Group's $2 billion purchase of Lehman Brothers' Asian, European, and Middle Eastern operations, and with Mitsubishi Financial's $9 billion investment in Morgan Stanley, the struggling New York investment firm. The government has also pledged $100 billion to the IMF to aid developing countries, the only country so far to do so. In the first such meeting outside a multilateral forum, Japanese leaders this week hosted Chinese and South Korean counterparts in Fukuoka to discuss how to buffer the Asian region.

Of course, Japan's slow response to its own bubble in the 1990s has offered a cautionary tale to the US and Europe on how to manage the credit crisis.

Japan just passed a law recommitting itself to Afghanistan-linked support operations, despite opposition. It provided 600 noncombat troops in southern Iraq, withdrawing them in 2006. Working with the UN Development Program, the country just invested $92 million to help 21 African countries deal with climate change – part of its $10 billion Cool Earth Partnership. And the rise in piracy off Somalia has prompted discussion of a bill to allow Japan, constitutionally limited to a defensive military, to send destroyers to escort oil tankers and commercial ships.

A world vastly different from the one that shaped Japan's postwar policy is driving a change in outlook, says Kenneth Pyle, an expert at the University of Washington. But it's unfolding gradually: Just as it took 15 years from the arrival of American gunboats in 19th-century Japan until a modern government formed, Japan is now deciding how best to respond to a world where cold wars and a weak China are the stuff of history books.

"Right now, there a kind of interlude, an interregnum where the international system is not clear," he says. "They are assessing, and it's going to take some time."

To some observers, Japan is in need of a leadership that interacts and communicates as easily as its pop culture. "In a globalizing world, Japan needs to be understood," says Sakie Fukushima, a managing director of Korn/Ferry International. "It needs to express opinions more effectively and be part of the world."

But the current prime minister, Taro Aso, has not won his countrymen's confidence. The nation faces political stasis, a rising income gap in a proudly middle-class society, a burgeoning elderly class, and a dropping birthrate. Last month, Japan officially tipped into recession, bringing gloomy reminders of the troubled 1990s.

Mr. Aso now confronts a divided parliament and a devastating 22 percent approval rating – boding ill for his Liberal Democratic Party in national elections, that must be held by next September.

For Aso and Japan, much depends on choices of a rising generation. Critics see some worrying trends: Interest in some foreign countries has waned; for the third consecutive year, the number of Japanese studying in the US has declined, while India, China, and Korea have seen double-digit increases.

Asahina, the government official, is aware of the hurdles even reform-minded officials face. "Most young bureaucrats share [Project K's] feeling," he says. "But to have a feeling and to take action are different. Most people are waiting and seeing."

He argues that Japan can take advantage of its membership in both Western and Asian spheres, with its "ambiguous" position an asset in bridging differences between other countries. "Japan has the potential to be persuasive in the world," Asahina adds. "We have to speak out strongly and differentiate ourselves. We can remodel."

• Last of three parts. Previous parts appeared on Dec. 15 and 16. Amelia Newcomb reported from Japan as a fellow with the International Reporting Project.