Identifier
Created
Classification
Origin
08TOKYO3326
2008-12-05 08:52:00
CONFIDENTIAL
Embassy Tokyo
Cable title:
JAPANESE BUSINESS LEADERS ON CURRENT GLOBAL ECONOMY
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C O N F I D E N T I A L TOKYO 003326
SIPDIS
E.O. 12958: DECL: 12/04/2018
TAGS: EFIN ECON PGOV JA
SUBJECT: JAPANESE BUSINESS LEADERS ON CURRENT GLOBAL ECONOMY
Classified By: Amb. J. Thomas Schieffer for Reasons 1.4 (b) and (d)
C O N F I D E N T I A L TOKYO 003326
SIPDIS
E.O. 12958: DECL: 12/04/2018
TAGS: EFIN ECON PGOV JA
SUBJECT: JAPANESE BUSINESS LEADERS ON CURRENT GLOBAL ECONOMY
Classified By: Amb. J. Thomas Schieffer for Reasons 1.4 (b) and (d)
1. (C) Summary. Nomura Holdings Chairman Junichi Ujiie and
Mitsui Chairman Nobuo Ohashi told Ambassador December 1
during a farewell lunch that despite what was wrung out of
the Japanese economy following the collapse of the bubble
economy and despite what they see as the basic HEALTH of
Japan's manufacturing, financial, and household sectors, a
number of Japanese business leaders think the country's
recovery from the current international economic turmoil
could take three to four years. Ohashi described himself as
an unusual outlier for thinking recovery could take place by
the end of 2009. Both asked about the likelihood of a USG
rescue package for the Big Three automakers, and were
concerned the industry's recovery could come later than
necessary and thereby delay any global economic upswing if
the U.S. failed to act appropriately. Asked about the
efficiency of the stimulus package under consideration within
the Japanese Government, neither Ujiie nor Ohashi thought it
would accomplish much. End Summary.
2. (C) Raising the international financial turmoil, Ujiie
said there is deep concern about the severity and likely
length of the economic downturn, with a significant number in
Japan thinking it could take three to four years for the
country to pull out of it. Ohashi, however, thinks Japan
could be out of the downturn by the end of 2009, but added he
is unusual in holding such a view. Ujiie stated Japan had
restructured following the collapse of the economic bubble
and said as well that Japanese financial institutions had not
been as involved with problematic financial instruments as
U.S. or European banks and investors. Japan's financial,
manufacturing, and household sectors are, in the view of the
head of Nomura Holdings, healthy. The concern is the
recession will be steeper than usual and, while not as
optimistic as Ohashi, Ujiie agrees many of the pessimistic
views expressed in the Japanese press and by the Japanese
public are off the mark. In this connection, Ujiie noted
however that the volatility in the Tokyo Stock Exchange --
and other major stock markets -- is a bigger factor affecting
Japanese consumer confidence and Japan's economy's ability to
move ahead than is the rising Yen.
3. (C) The two businessmen asked the Ambassador about the
status of the U.S. auto sector and the likelihood of a rescue
package for the Big Three automakers. Both were concerned
that the rescue package might come late and thereby make
recovery harder. Ohashi asked about the possibility of
General Motors being broken into two entities, ONE making and
selling civilian vehicles and the other ONE making them for
military end users as a means of saving the company.
4. (C) Ujiie and Ohashi also inquired on whether the U.S.
might go along with some of the ideas put forward by European
leaders regarding limiting executive pay. The Ambassador
noted the importance of governments doing what is necessary
while avoiding becoming too interventionist. The Japanese
business leaders agreed the situation is like a baseball
game: umpires are necessary to make sure the game moves ahead
according to the rules, but at the same time all need to
remember the fans paid and came to watch the players and the
game -- not the umpires. EMIN also noted the points in the
G20 Leaders Statement re-affirming the need to let market
principles and forces operate.
5. (C) Asked about the stimulus package the Aso Government
is developing, Ujiie and Ohashi both said they did not expect
it to have much effect.
SCHIEFFER
SIPDIS
E.O. 12958: DECL: 12/04/2018
TAGS: EFIN ECON PGOV JA
SUBJECT: JAPANESE BUSINESS LEADERS ON CURRENT GLOBAL ECONOMY
Classified By: Amb. J. Thomas Schieffer for Reasons 1.4 (b) and (d)
1. (C) Summary. Nomura Holdings Chairman Junichi Ujiie and
Mitsui Chairman Nobuo Ohashi told Ambassador December 1
during a farewell lunch that despite what was wrung out of
the Japanese economy following the collapse of the bubble
economy and despite what they see as the basic HEALTH of
Japan's manufacturing, financial, and household sectors, a
number of Japanese business leaders think the country's
recovery from the current international economic turmoil
could take three to four years. Ohashi described himself as
an unusual outlier for thinking recovery could take place by
the end of 2009. Both asked about the likelihood of a USG
rescue package for the Big Three automakers, and were
concerned the industry's recovery could come later than
necessary and thereby delay any global economic upswing if
the U.S. failed to act appropriately. Asked about the
efficiency of the stimulus package under consideration within
the Japanese Government, neither Ujiie nor Ohashi thought it
would accomplish much. End Summary.
2. (C) Raising the international financial turmoil, Ujiie
said there is deep concern about the severity and likely
length of the economic downturn, with a significant number in
Japan thinking it could take three to four years for the
country to pull out of it. Ohashi, however, thinks Japan
could be out of the downturn by the end of 2009, but added he
is unusual in holding such a view. Ujiie stated Japan had
restructured following the collapse of the economic bubble
and said as well that Japanese financial institutions had not
been as involved with problematic financial instruments as
U.S. or European banks and investors. Japan's financial,
manufacturing, and household sectors are, in the view of the
head of Nomura Holdings, healthy. The concern is the
recession will be steeper than usual and, while not as
optimistic as Ohashi, Ujiie agrees many of the pessimistic
views expressed in the Japanese press and by the Japanese
public are off the mark. In this connection, Ujiie noted
however that the volatility in the Tokyo Stock Exchange --
and other major stock markets -- is a bigger factor affecting
Japanese consumer confidence and Japan's economy's ability to
move ahead than is the rising Yen.
3. (C) The two businessmen asked the Ambassador about the
status of the U.S. auto sector and the likelihood of a rescue
package for the Big Three automakers. Both were concerned
that the rescue package might come late and thereby make
recovery harder. Ohashi asked about the possibility of
General Motors being broken into two entities, ONE making and
selling civilian vehicles and the other ONE making them for
military end users as a means of saving the company.
4. (C) Ujiie and Ohashi also inquired on whether the U.S.
might go along with some of the ideas put forward by European
leaders regarding limiting executive pay. The Ambassador
noted the importance of governments doing what is necessary
while avoiding becoming too interventionist. The Japanese
business leaders agreed the situation is like a baseball
game: umpires are necessary to make sure the game moves ahead
according to the rules, but at the same time all need to
remember the fans paid and came to watch the players and the
game -- not the umpires. EMIN also noted the points in the
G20 Leaders Statement re-affirming the need to let market
principles and forces operate.
5. (C) Asked about the stimulus package the Aso Government
is developing, Ujiie and Ohashi both said they did not expect
it to have much effect.
SCHIEFFER