Once world's No. 2 economy, Japan draws mockery: 'A country that can do nothing'

Japan, once the world's second-largest economy, appears to be losing the standing it once held in both economic and diplomatic affairs.

The Nikkei Shimbun reported Saturday that Japan's government has been limited to lodging diplomatic protests in response to recent provocations by China, Russia and North Korea, with no meaningful countermeasures in sight, according to Yonhap.

The newspaper said the situation has been compounded by the impression that a rift has emerged in the Japan-US alliance after Washington announced sanctions targeting the International Criminal Court.

Tensions with Russia flared after President Vladimir Putin visited Iturup Island in August — one of four islands in the Kuril chain, known in Japan as the Northern Territories, at the center of a territorial dispute between the two countries.

On Tuesday (local time), a delegation of officials and business figures from China's Heilongjiang provincial government visited the same island. Russia then announced that its Federal Security Service had arrested a Japanese journalist on espionage charges in the Far Eastern Sakhalin region.

Japan's government protested both the Chinese delegation's visit to the Kuril Islands and the arrest of the journalist, also calling for humane treatment of the detained reporter.

Amid all this, North Korea fired several ballistic missiles on Monday. Japan lodged a protest through diplomatic channels in Beijing.

In each case, Japan has gone no further than protests and requests, without offering any stronger response, the Nikkei said.

The newspaper also noted that the provocations by North Korea, China and Russia have coincided with a period in which tensions between the United States and its Western allies — including Japan and European nations — have come to the surface.

The United States announced sanctions in August against individuals including Tomoko Akane, the Japanese president of the ICC. On Friday, Washington imposed a further round of sweeping sanctions against the court itself. Prime Minister Sanae Takaichi posted on X that Japan "consistently values the rule of law in the international community and supports the ICC in fulfilling that role," adding that the US measures "are not consistent with Japan's longstanding position, and we express deep concern."

The Nikkei said the discord between Japan and the United States over the ICC sanctions has created an impression — both at home and abroad — of a crack in the alliance.

The paper said voices within the ruling Liberal Democratic Party have warned that Japan is being "looked down upon" because it has "never taken any stern action." A senior government official told the Nikkei that Japan is seen as "a country that can do nothing," while adding: "We could impose sanctions if we wanted to, but we also need to consider Japan's national interests."

Japan's economy set to fall behind India and UK?

Japanese Prime Minister Sanae Takaichi [Yonhap]

The economic outlook offers little comfort either.

The International Monetary Fund recently projected that Japan will be overtaken by both India and the United Kingdom in nominal GDP next year, dropping to sixth place in the global rankings.

According to Japanese media including the Nikkei on Wednesday, the IMF's latest World Economic Outlook forecast Japan's GDP at $4.34 trillion this year and $4.47 trillion next year.

India's GDP is projected to reach $4.52 trillion next year, placing it fourth in the world, and is expected to climb to $6.74 trillion by 2031 — making it the third-largest economy behind only the United States and China.

The United Kingdom's GDP is forecast to reach $4.49 trillion next year, lifting it to fifth place.

The IMF's April estimates had put the year of Britain overtaking Japan at 2029, but that timeline has now been pulled forward by two years.

Japan's slide to sixth place is attributed to a weakening yen that has eroded dollar-denominated income, compounded by slowing growth.

Japan's average real annual growth rate over the 25 years through last year stood at 0.7 percent — trailing not only emerging economies such as China at 8 percent and India at 6.3 percent, but also major developed nations including the United States at 2.1 percent, the United Kingdom at 1.6 percent and Germany at 1 percent.

Japanese media have also noted that the yen's persistent weakness has made the decline in dollar-denominated income increasingly pronounced.

yul@heraldcorp.com