Japan looks for economic kick
The World Cup starts on Friday in South Korea and Japan, where the sagging economy needs help.
Sweet cakes in soccer-ball-shaped tins are on store shelves. Collectable plastic players dangle from the neck of every cola bottle. And on T-shirts, the world's most popular object of play is thrown into classic paintings of sumo wrestlers and kabuki actors. You'd have to be living under a rock not to notice that the World Cup is Japan's hottest fashion statement.
At least that is what organizers here are hoping for as Japan prepares to host jointly with South Korea the quadrennial World Cup soccer tournament, which will be watched by some 40 million people around the globe.
With just three days to kick-off, many eyes are more focused on the potential kick-start that the month-long World Cup will provide to Japan's flagging economy than on the game itself.
When Japan played host to the 1964 Olympic Games, it launched a period of great economic growth. The same could be true for the World Cup, shining an international spotlight on Japan at a time when the country's economic prognosis is rarely mentioned without adjectives like "gloomy" and "grim" attached.
Japan is expecting the World Cup to trigger consumer spending to the tune of 1.8 trillion yen ($14.4 billion), according to the Dentsu Institute for Human Studies, which was commissioned to study the economic impact of the World Cup on Japan. And with construction spending on new stadiums and infrastructure figured in, the contest for soccer hegemony will add 3.3 trillion yen ($26.4 billion) to the Japanese economy and 3.6 trillion yen ($28.8 billion) if Japan wins the title. The hope here is that if Japan can make it to the final matches amid the top eight teams, the Japanese public will keep the football fever and keep spending.
"If Japan is eliminated in the opening rounds, it will be harder to maintain consumer momentum," says Norio Kamijo, senior research director at the Dentsu Institute. The opposite scenario that Japan wins the World Cup, as France did while hosting the games four years ago is one that Kamijo says could lift Japan out of the doldrums altogether. "The successful effect of the World Cup in France and of course, France's victory, led to a period of economic growth," he adds.
France, however, spent less than a third of what Japan has spent on building new stadiums a whopping 10 new mega-venues since 1996, when it agreed to sponsor the games with South Korea. Construction spending alone amounted to 571.1 billion yen ($4.6 billion), a hefty sum in a country with a shrinking economy dragged down by nonperforming bank loans, deflation, and the inability of politicians to implement promises of reform.
The construction spree, which included the building of massive stadiums that may not find regular use after the World Cup, points to a well-worn pattern of mutual support between the construction industry and the ruling Liberal Democratic Party. It is a relationship that was often criticized by Prime Minister Junichiro Koizumi, who came to power a year ago amid great hopes of shaking up Japanese politics. Instead it shook him, and his approval ratings have dwindled into the 30-percent range.
Junji Ogura, vice president of the Japan Football Association and the Deputy General Secretary of Japan's organizing committee for the World Cup, says it is not appropriate to compare Japan's construction spending with France's, since the 571.1 billion yen figure includes the cost of buying real estate on which the stadiums were built. "In Japan, real estate is very, very expensive," he told reporters recently, "and you must take that into consideration."
The government also hopes fans will be paying for high-end goods and services, such as hotel rooms and electronics equipment. Japanese television makers are pushing for a sales boom in large flat-screen TVs.
Consumers are also snatching up commemorative items that have a far shorter shelf life. At a World Cup souvenir shop in central Tokyo, mere key chains go for more than $9.00.
Outside, a young advertising-agency employee with dyed orange hair watches clips from a match on a TV screen through the window. He says he had bought the uniform of his favorite player just for fun. Football fever, he says, has also been good for the advertising industry.
He also says the World Cup could open a new era of cooperation with South Korea, with whom Japan has historically had tense relations. "I think it's a good idea for us to have a friendlier relationship with Korea." he says.