Japan Comprised of more than 3,000 islands, Japan is located off the eastern coast of mainland Asia. Japan's total land mass is slightly less than that of California. The country is largely mountainous and contains very few natural resources. In fact, Japan is the largest importer of coal and liquefied natural gas in the world.67 Japan is among the densest large countries in the world. More than 90 percent of the country's population, estimated at nearly 126 million in total, lives in urban areas. Approximately 37 million people live in Tokyo alone. Japan's population is much older than many other countries, with close to 80 percent of its people at 25 years old or older and a median age of 47.7 years. The population is expected to continue to slowly decline in the foreseeable future.68 Japan's 2018 GDP was estimated at US$5.167 trillion, making it the third largest economy in the world. Previously second to only the United States, the country's flat and sometimes declining economic growth rate has allowed the fast-growing Chinese economy to overtake it in total size. Japan's economy had been struggling since the 1980s to gain traction; however, growth has improved in just the last few years. High public debt, which in 2018 equaled more than 150 percent of its annual GDP, remains an ongoing challenge.69 Japan has a parliamentary government with a constitutional monarchy. Its legal system is largely based on the Western model with some elements of traditional Japanese culture. The country's corporate culture is often criticized for the close business-government relationship that many large companies have, leading many outsiders to call the relationship "Japan, Inc."70 This culture is very resistant to change and strives for stability, often leading to substantial losses. The Japanese government also has been criticized for blocking private-sector solutions to economic underperformance. For example, rather than allowing foreign investors to acquire failing or underperforming Japanese businesses, the government instead seeks to support those domestic businesses in the form of cash or loans.71 You Be the International Management Consultant Once considered to the be world leader for consumer electronics, Japan's tech industry has experienced years of slow sales. As a result, some of Japan's biggest companies have restructured their product offerings and sold portions of their businesses to foreign competitors. The Sharp Corporation, known internationally for its televisions, appliances, and audiovisual equipment, was sold in its entirety to the Taiwan-based Foxconn in 2016, and Toshiba sold its computer business to Foxconn in 2018. Hitachi has been especially active in consolidating its businesses. The company sold its semiconductor business, Hitachi Kokusai Electric Inc., to U.S.-based KKR in early 2018, and French company Faurecia purchased Hitachi's car navigation business, Clarion, for US$700 million in late 2018. In 2019, Hitachi began searching for a buyer for its material manufacturing business, Hitachi Chemical, in an effort to refocus on new technology, like the "Internet of Things." This major shift in focus, from electronic consumer products to technology, for Japan's historic conglomerates is still in its infancy, and the future role of tech-based industries in Japan's economy remains somewhat uncertain.72 Questions 1.If you were a foreign investor, would you want to invest in a consumer electronics company in Japan? 2.Does the fact that many of these conglomerates are restructuring and refocusing on newer technology impact your decision? 3.What do you see as benefits to investing in Japan? What are some difficulties that you could experience as a foreign company expanding into the Japanese market