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A Cool Forecast for Japan in 1991

THIS being the Year of the Sheep by an ancient cycle, Japan will begin it with apt modesty. Its once-thundering economy will see the boom end in 1991. And legacies of World War II will play highly during the year. A war in the Gulf would put Japan on the spot with the United States and test their alliance.

But for the average Japanese, more wooly matters will count. For instance, local phone numbers in an ever-denser Tokyo will rise to eight digits, putting a new strain on index fingers and memories. The imperial crown prince may or may not finally get married and produce an heir. A fad in Italian restaurants will likely fade like cold spaghetti. And the rebellious notion of free-agent players will enter the strike zone of Japanese baseball.

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More Japanese workers, once submissive before the greater good of the corporation, will feel their oats as Japan struggles with an acute labor shortage. Temporary foreign workers will begin to be imported. (The government plans to give extra cash to women if they have babies - a desperate attempt to boost the lowest birthrate of any industrial nation.) And the first women will enter the National Defense Academy, making gentlemen out of the officers.

New-style leisure centers, such as indoor surfing and indoor skiing, will open up as the government tries to mellow the nation's herd of workaholics. Having set 1991 as the target year to get 10 million Japanese to travel overseas, officials have called off a celebration. The target was reached in 1990.

Japanese ambition to ``keep up with the Suzukis'' (or more accurately, keep one step ahead of them) will bring the usual flock of new high-technology consumables. Inexpensive fax machines for the home will hit the market, allowing students to skip classes and get lecture notes sent to them later by friends.

Many more home appliances will be implanted with controls that run with ``fuzzy logic,'' an advanced computer process that allows machines to handle vague and imprecise information, a very pleasing idea to the sometimes nebulous Japanese. After a boom in lap-top computers last year, mobile phones will ring up the new year and be glued to any ear craving to appear torendii (trendy).

The first high-definition television sets will be available - for more than $30,000 each. The government's NHK network plans to broadcast the finer-line images several hours a day to boost an industry trying to get everyone to throw out their present sets. Radio listeners in Japan were given the world's first digital broadcasts via satellite last year.

At least two threatening American imports will enter Japan, after years of pressure from Washington. Toys ``R'' Us, a spearhead for American retail stores, will open the first of about 100 stores planned for Japan, shaking up a protected mom-and-pop industry. And US beef will stampede into food stores and restaurants in April under trade liberalization, bringing T-bone steaks to the folks that gave sushi to America.

As for new exports, the whole world will begin to see the first movies financed by two Japanese electronic giants, Sony and Matsushita, after their recent buyouts of Hollywood studios.

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In domestic politics, Prime Minister Toshiki Kaifu, whose party leadership ends in October, will likely be replaced this year, after serving two years in a caretaker role for the scandal-beset Liberal Democratic Party. Many political decisions, including a proposed revamp of the election process itself, will pivot on local elections slated for April.

Japan's recently rising military spending will stall as it tries to make sense of the post-cold-war world and its security treaty with the US. Economic growth will dip from more than 5 percent in 1990 to a projected 3.8 percent, hinged to gyrating oil prices. Rich Japanese banks, hit by last year's plummet of the stock market and the plateauing of land prices, will need to consolidate, leaving less Japanese money to go overseas to subsidize US deficit spending.

Japan will turn a corner in 1991 as Asia overtakes the US as the biggest export market for Japanese goods. And a newly enthroned emperor, Akihito, is expected to visit a few Asian countries in an attempt to resolve lingering resentment from World War II and make way for a larger Japanese role in the region.

Soviet leader Mikhail Gorbachev will visit in April at cherry blossom time and try to thaw the diplomatic ice. Japan claims four islands occupied by Soviet troops at war's end in 1945. A breakthrough would open a way for Japan to tap Siberian resources.

Hanging over Japan's troubled ties with the US will be the 50th anniversary of the Japanese attack on Pearl Harbor, reminding Americans of past Japanese aggression at a time of sticky economic disputes.

Japan also worries about US moves to impose reciprocity in many trade demands. An idea that may become popular this year in US trade policy, Japanese officials say, is that the Japan will never really open its home markets, ending a postwar US assumption that Japan will eventually adopt Western-style capitalism and forsake its mercantile ways.

Any number of thresholds will need to be crossed this year by the US and Japan. Major decisions are pending on renewing quotas set on Japanese car exports to the US, the failure of Japanese companies to buy a promised percentage of American computer chips, the lack of access for US companies in Japanese construction projects, and a host of US demands left hanging from last year's Structural Impediments Initiative talks.

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