Press translations [Japan]. Economic Series 0116, 1945-12-31.

Summary:

JAPAN has suffered much in her attempt to build up the so-called "total defense state". Because of that attempt, ordinary industrial activities were being sacrificed for some time. The resulting perturbation of industries is rather natural. The unsettled condition of the issue of reparation, however, is one of the important factors obstructing the start of industrial operations. The extent of confiscation of fiscation of factory equipment will affect the future of the nation's industry greatly.

Mr. PAULEY, of the Reparations Commission, pointed out that the present decline in the standard of living in JAPAN is one of the results of the economic and administrative confusion which followed the nation's military defeat. Considering war damage, the loss of colonial territories, reparations, and the steady increase of population, the decline of the general standard of living will be quite understandable.

Based on the 1930 standard of per capita consumption and the 1941 price level, the Nation must import annually food worth 1, 600 million yen, including 645 million yen of rice. For cotton, wool and other clothing materials, the Nation shall pay 563 million yen a year. The import of other raw materials such as petroleum, rubber, iron ore, and others will reach 1,046 million yen. Altogether, the importation of essential goods will amount to 3,200 million yen each year. Added to this, we must account for the unfavorable invisible balance of trade to the extent of 300 million yen which will be accrued because of the loss of the shipping industry and colonial investments. Thus, JAPAN's annual external payments will reach 3,500 million yen.

Our primary export products were raw silk, fish products, and the like. All of them will be encroached upon in the future by the increases in food crop acreage, and the loss of fishing bases in northern waters. Therefore, their annual export surplus will hardly reach one billion yen. Consequently, the deficit balance of 2,500 million yen must be met by exports of manufactured goods such as cottons and silks, groceries, and chemical and machinery products, raw materials for which are obtained from foreign sources in all or in part. It is estimated that 27 per cent of the raw materials for the foregoing products come from abroad. Therefore, in order to manufacture 2,500 million yen worth of goods for export, we must import raw materials valued at 900 million yen and must export 3,400 million yen of finished products. This suggests the great importance of the export industry for the mere maintenance of the balance of trade.

At this point, the importance of the reparation policy shows itself again. Now, Mr. PAULEY suggested the removal of the most modern facilities and equipment of the soda and contact sulphuric acid

ECONOMIC SERIES: 116 (Continued)

ITEM 1 (Continued)

factories. We fear the adverse affect of such action on the textile and fertilizer industries. The capacity of iron smelting will be limited to 2.5 million tons, while the necessary iron ore, in order to maintain the industrial standard of JAPAN, is estimated at 3.5 million tons. Of course, mistakes may be corrected before the formulation of the final plan. Nevertheless, the decline of the general economic level in post-war JAPAN is almost inevitable. Instead of furthering the confusion, the democratization of the economic system should be encouraged. We retain confidence in the words of Mr. PAULEY that with peace and democracy, the people of JAPAN will find an abundant life which has never been enjoyed under militaristic rule.

Summary:

A directive concerning employment in JAPAN is expected to be issued shortly by the Welfare Ministry in accordance with a recent Supreme Headquarters memorandum. as to how the Government will deal with unemployment. The directive orders the handling of unemployment in a democratic way, taking the following into consideration:

Fair treatment of workers, regardless of their nationality, and cessation of discrimination against workers by employers because of nationality, religion, or social status. Accordingly, labor conditions such as wages and working hours will be equalized. And the same measures will be adopted in official quarters. Under the directive, Korean, Formosan, and Chinese workers will be able to enjoy the game rights held by Japanese workers.

Summary:

The Agricultural Land Reform Law was passed in the Diet's last session. This law, while possessing certain merits, will still leave 1,200,000 cho of tenant lands and 350,000 tenants untouched, as a result of limiting the acreage for the application of the Law to 5 cho or more.

The debaters in the Diet on the Land Law revealed many interesting sidelights which may indicate the present stage of political balance in JAPAN. Beside the fact that the Land Law set the border line for application at a rather high level, 5 cho, it permitted the produce-rent along with the money-rent as a substitute measure. The land evaluation system, which will allow relatively high compensation for lands and the limitation of the powers of the farmland commissions, which will handle the matter of land distribution on the spot, are other points of criticism.

However, it is not the landowning class which is the chief controlling influence in agrarian policies. It is the farmer-owner class which influences the agricultural policies at present. Under the present inflation of food prices, the farmer-owners who produce and handle crops are actually the most prosperous, and are becoming the mainstay of rural communities in place of the landlord class, which pays the taxes but cannot handle the crops because of the present regulations. This is due to the fact that, according to present regulations, the Government holds priority on the rent crops as the rice quota.

- 2 -

ECONOMIC SERIES: 116 Continued)

ITEM 3 (Continued)

The last session of the Diet reflected progress in the sense that it attacked many of the "feudalistic" landlords' interests. But still it is a kind of bourgeois reform with its necessary shortcomings. Considered from the true democratization of the rural communities, the true proletarian reforms are yet to come in the Japanese agricultural world.

Full translations:

An Act concerning the disposal of civil airplanes was recently published on 29 December by the Ministries of Commerce and Industry, Education and Communications; the Act was immediately enforced. Its contents are as follows:

Matters concerning the disposal of airplanes, based upon the order issued in accordance with the POTSDAM Declaration -

Article 1 - The equipment for research, experiment, adjustment and production of airplane motors, combined requisites, and airplanes (including experimental models) should be kept in good condition.

Article 2 - The above-mentioned equipment cannot be bought or used for flying, except that of the institutes for the production of airplanes (including experimental models) and the study of aeronautical science for which permission was given in 1945, according to Article 2 of Act 1, issued by the combination of the Commerce and Industry Ministry, the Agriculture and Industry Ministry and the Communications Ministry.

Article 3 - Instruction, research and experiment, relating to aeronautical science and aero-dynamics and subjects concerning airplanes and balloons are not allowed.

Article 4 - The violators of the preceding two Articles will be punished by penal servitude or imprisonment for up to three years or a fine up to five thousand yen.

Article 5 and those following are omitted.

Full translation:

As a means of promoting manganese production, representatives of the manganese mining industrialists have been demanding the realization of official quotations in each district and the purchasing and selling on bloc of manganese ore by the Manganese Mining Industrial Unions (MANGAI KOGYO KAI) in their respective districts. Concerning these points, the Ore Distribution Company (KOSEKI HAIKYU KAISHA) held a conference between officials of the Commerce and Industry Department and a group of consumers on 27 and 28 December.

As a. result of the conferences, it was decided to study, hereafter, the raising of the price of metallic manganese up to two and a half times, and of manganese dioxide up to three times the present prices. (TN The former, 35 per cent base, 129 yen per ton, and the latter, 70 per cent, base, 197.50 yen par ton.) At the same time, they agreed to apply to the authorities for permission for the provisional transfer of ore management to the Manganese Mining Industrial Union (MANGAN KOGYO KUMIAI) In each district, after the dissolution of the Ore Distribution Company (KOSEKI HAIAYU KAISHA). In addition, the demand by the con-

- 3 -

ECONOMIC SERIES: 116 (Continued)

ITEM 5 (Continued)

sumers' groups for the promotion of manganese production will hereafter increase the demand for manganese ore. However, the actual condition is that only 120,000 tons of manganese ore were produced by the end of November as against the 300,000 tons aimed at in the production plan of this year. It is feared that the production of next year will not amount to even 100,000 tons, unless this condition is improved.

DISTIRBUTION "X"

- 4 -