Islamic economic order japan
The present world economy is facing grave difficulties with mounting inflation and unemployment; a growing gap between the rich and the poor; and balance of payments and trade deficits.
Japan is no exception. Although today she ranks as the second economic giant in the world after the United States, having a highly industrialized and technologically advanced society with effective entrepeneurship, she still faces enormous economic: difficulties as an ultra-modern and powerful state. She pays a price to maintain her phenomenal advances in science and technology.
120 million Japanese domicile mostly along the Japanese archipelagoes in o¬nly 17 percent of inhabitable area. This inherently makes land prices exhorbitantly expensive. Moreover, Japan imports 75 percent of her food requirements and 98 percent of her mineral resources. In other words, Japan is not self-sufficient in these necessities and as a leading trading state, importing all her raw materials, she must export finished products. Although her industrial goods have become highly competitive, this competitiveness has produced trade frictions with other industrialized powers such as the United States and western Europe, as evidenced in their current governmental negotiations over exports of automobiles, electronics, computers, machines, plants, etc.
Presently, Japan is widely accepted as a part of the industrialized "West," but historically, culturally and geographically belongs to the East.
When thought is given to the future international economic order, the relationship between the industrialized countries and the developing countries are naturally important, but equally important is the order among these nations. In particular, the principle of free trade, which has been a regulating force in the market economy countries, has failed to bear the brunt of the pressures from prolonged global economic stagnation and high employment rate, which act to modify the working rules of the principle of free trade.
The domination of European and American markets by highly competitive Japanese products produced anxieties in those nations to the extent that they were urged to counter Japan with possible trade obstructions and import trade quotas. Therefore, the present international economic system, including free trade, is o¬nly beneficial to the industrialized West when the rules apply to weaker developing countries. Now with Japan as a new champion of the free trade system, some leading Japanese business personalities such as Mr. Takeshi Sakurada, Chairman of Japan Employer; Association (Nikkeiren), advocate a new international economic order that will be fairer to Japan than the existing o¬ne. Continuous trade and economic frictions vis-a-vis the United States and Europe have compelled such support for a new order.
Japan is a latecomer in the economic industrial revolution. Her recognition as an industrial power came when she achieved economic development in modern world history. As a latecomer and formerly a developing nation, she can empathize with third world countries who seek equality with industrialized nations. Japan demanded equality with the Unitet States and Europe, but o¬nly obtained it with her economic development.
Now that Japan has achieved a high level of industrialization, the major problem is her uneagerness to demand equality for third worl nations. The Japanese, as a peaceful people, have attempted to and are continuing their efforts in building an industrialized country o¬n the basis of the 'Japanese constitution, whose foreword reads that the Japanese people support the rights of all nations to strive for peace and prosperity and to be liberate from hunger. In other words, Japanese are dedicated to world peace and prosperity. If Japan applies these principles, then she could, in th context of a new world order, cooperate with the Third World with equality.
There has been much debate in Japan over her westernization. Through the rapid process of industrialization, the Japanese accepted western value indricminately, consequently leading to competition in society rather than cooperation. Social problems similar to those found in western societies, such as moral degradation, materialism and greediness, began to emerge. The dominant western economic growthphilosophy penetrated Japanese minds to such an extent that the entire meaning of life came to represent the accumulation of money and the maximization of rate of growth, savings and investments. In light such ills the challenge for Japan today is whether or not she can survive her own psychological. spiritual and cultural shake-ups.
ANALYSIS OF THE PRESENT INTERNATIONAL ECONOMIC ORDER
From every available statistic, it is clear that industrialized West constitutes the powerful central core of of the world economy, while the entire Third World is its weak periphery. The periphery is dependent upon the centre that sucks its resources from it. The result is a hierarchical and exploitative world order, with buil-in arrangements for the transfer of resources from the underdeveloped world to the developed world. In other words, development and underdevelopment are not two independent realiszations, but two aspects of the same process.
Under this structure of the international economy, the failure of the developmental efforts made over the last three decades in the underdeveloped world, which contains two-third of the human race, and the deteriation of relations between the developed and the underdeveloped countries, are being highlighted in almost all international forums, academic as well as political.
The spokesmen of the industrialized world increasingly acknowledging some of the realities occuring in the third world: of poverty, misery and deprivation; of disease and illeteracy; of death and starvation; of underdevelopment and retardation of growth; of widening gaps in economic well-being and the mounting weight of international international debts; of worsening terms of trade and depletion of mismanagement of natural resources; and of apathy and misdevelopment.
The leaders of the Third World are becoming more and more vocal and assertive. Because of a number of built-in mechanisms in international trade, which favours the industrialized world and limit the options open to the Third World, the prices of raw material have been a very unstable factor resulting in the decrease in the relative value of exports from the Third World, while prices of imports from the industrialized world have continued to increase. Many efforts to stabilize the prices of raw materials have been frustrated because they conflicted with the interests of the industrialized world.
The first significant effort o¬n the part of the Third World to gain control over the prices of its own products was in oil. The West deliberately kept the price of oil much lower than its real ecnomic price and built its own economic, prosperity by keeping this source of energy cheap. Japan benefited from the cheap energy source in carrying out, in full swing, its industrialization program at unprecedented economic growth in the 1960's. Therefore, any attempt by the Third World nations to set an economic price of an essential source of energy was regarded as a "declaration of war" by the industrialized world. Despite the successful breakthrough by OPEC to gain control over the process of their products, the technological dependence of the Third World o¬n the industrialized nations has remained the same.
In addition, it is debatable whether or not the technology of the West would suit conditions of the Third World. In spite of some transfers of technology, it is clear that the new technology is unable to act as an internalized factor of growth. Instead, it produces new technological destabilization without really meeting the technological needs of these societies. The technological dependence of the Third World o¬n the West is thereby increased and as the prices of capital goods escalate, this dependence produces financial dependence. Consequently, the third world countries are asking for the following changes in the present international economic order:
(1) A Restructuring of International Institutions, particularly of the Montary Fund, the World Bank and the Operative Organs and Security Council of the United Nations. The first major demand of the developing countries is the restructuring of international institutions so as to allow them a greater say in economic and political decision-making at the international level.
(2) An Acknowledgement of National Sovereignty Over their Raw Materials, At present, most of these raw materials are either in the hands of the multi-national corporations not fully under the control of national governments; or have their extraction, development and trade under the influence of developed nations that are capable of manipulating their price and or supply. Thus, these resources are at the mercy of outside sources. Instead, the pricing and ownership of and benefits derived from raw materials and energy sources found in the Third World should be the sole right of the third world countries.
(3) A More Equitable Division of Labor. The present inter national division of labour leads to a perpetuation of a secondary role lor the producers of raw materials, with the industrialized world specialized in the production of manufactured foods and tertiary services. This division creates the type of economic development in the Third World expected of those countries, and its consequent relative shares of economic power for different parts of the world.
(4) The Freedom of Movement for Goods. Free movement of especially manufactured and even agricultural and dairy products of the Third World into western Europe and America is another worry of the underdeveloped world. They insist o¬n access to these markets in order to step-up their economic development, and to seek evolution of some permanent mechanism to stablize prices.
(5) Improved Arrangement of the Financing of Development. Due to the deterioration of the terms of trade, most of the underdeveloped countries are facing balance-of-payment crisises. Foreign aid has failed to provide any real relief. First of all, "foreign aid" is a misnomer because it is not a grant or subsidy. Almost ninety percent of it constitutes tied loans extended o¬n commercial terms, and is subjected to a number of restrictions. The result is that the net benefit is sometimes more in favour of the donor than of the receipient. The volume of aid is also considerably below the needs of the developing World. Total foreign aid from the developed world was far below the targets set for the 1960s and for the 1990s, so that voluntary transfer of resources from the rich to the poor is not taking place. The burden of external debts has risen too high, and quite a significant part of the export earnings of most of the Third World countries is eaten up in service charges and debt repatriation. The Third World is, therefore, advocating some form of compulsory transfer of resources from the rich to the poor through international institutions, as against bilateral aid. The Third World has proposed a new deal with the West that will restructure the economic relations between them. As such, a number of packages and strategies have been developed to bring about a new economic order. At the level of analysis and consequent remedy, there is a wide divergence of opinion.
Western economists and statesmen emphasize greater interdependence between different parts of the world and relative obsolescence of the idea of national sovereignty and autarky. They throw light o¬n the benefits that the Third World has derived from its contracts with the West, and the continuing assistance the West is sending to them.
According to this thesis, the prosperity of countries is through interdependence-the Third World can prosper o¬nly if the industrialized world prospers. Anything that damages the West and its economic prospects is bound to adversely affect the prospects of the developing nations.
Third World theorists have developed a framework for the analysis of their relationship with the West. As against the West's concept of a benevolent world economy in which the growth and prosperity of the West results in spreading wealth to the underdeveloped world, these theorists argue that their countries cannot reasonably hope to achieve self-sustaining development without breaking themselves from this system of dependence and bondage.
The remedy each group offers the contemporary international economic crisis emanates largely from their analysis of the crisis. The western economists believe that solutions to the problems are possible within the overall framework of the present order by improving efficient allocation and use of resources, and by some transfer payments within the system. The other group insists that structural changes are an essential precondition for any real changes to the situation.
The Islamic Approach to a New World Order
Both the western economists and the Third World analysts explain the present crisis in the international economic order from the thesis of "inter-dependence" and dependence, and each explanation is very much rooted in the overall sympathy Framework to which each analyst happens to belong psychologically, culturally and economically. However, the basic problems that confront man today are very similar whether they are under capitclism or socialism. In fact, both of these systems are products of the same cultural system - the western civilization. Capitalism and socialism are both equally exploitative and unjust. The establishment of a just and humane order for the moral well-being of man is not their primary concern; they deal with different blueprints of mechanistic structures of society. They respond now as self-sufficient and regard material and economic progress as a real objective. They cannot offer alternate goals higher than the material privileges of economic wealth, political power, military strength and international influence. A conflict of interests is built into this concept of life. It is bound to result in a crisis of values.
The crisises that confront man today are truly global: mass poverty; frustrated take-offs in development; increasing disparities at regional, national and international levels; co-existence of hunger and affluence; irrational use of nonrenewal resources; incongruity between technology and developmental needs; unsuitability of production and consumption processes to environmental needs; exploitation of the poor by the rich and powerful; inflation and stagnation; structural deformities in relations between developed and developing countries.
Our first realization should be in recognizing that the crisis is not confined to economic relations and institutions: it is, rather, an all pervading crisis of civilization and not merely of the economic order.
Since today's crisis is global in scope and all mankind faces this challenge, it must be stated by all with all their force in terms of faith, that the real issue is not simply that of a new international economic order, but of a new World Order based o¬n a concept of man o¬n a different vision of society and of man's destiny o¬n earth. Any effort at reforming the inspiration of world faiths in general, and of Islam in particular, must start with relating this perspective to the understanding of the human predicament. The real need is to re-examine the foundations o¬n which the entire structure of the society and economy is built, and the ideals with which the culture aspires to achieve.
The crisis' economic and political dimensions are a natural outcome of those ideals and the structures built to realize them. Islam, therefore, suggests that it is o¬nly through inviting mankind towards a new vision of man and society that its house can be set in order.
The Islamic approach to a new world order is value-oriented. The Islamic view of the present crisis confronting mankind is that of the crisis of civilization.
The western approach has always assured that radical changes can be brought about by changing the environment. That is why emphasis has always been "placed o¬n structural changes" However, this approach has failed to produce proper results. It has ignored the need to bring about change within man and has concentrated o¬n change in the outside world. What is needed instead is a total change - a change within man as well as in his social environment. The problem is not merely structural, although structural arrangements would also have to be remodeled. The starting point of this change must be the heart and soul of man - his perception of reality and of his own place and mission in life.
Islam is a movement for social change. In our search for a new world order today, Islam emphasized that we must aspire for a new system of life which can approach human problems from a different perspective-not merely from the perspective of limited national and regional interests, but from the perspective of what is right and wrong, and how best man can strive to evolve a just and a humane world order at the individual, national and international levels of his existence. That the present order is characterized by injustice and exploitation is proved beyond any doubt. Islam suggests that the present order is a failure because it is based upon a wrong concept of man and of his relationship with other human beings, society, nature and the world.
Islam influences man at different levels of his existence: belief, motivation, personal character, individual behaviour, social institutions and collective action. That is why it is more appropriate to say that Islam is a faith, a way of life, a process of change and a social movement for the reconstruction of society and the establishment of a just world order, and not just a religion.
Islam's strategy for the establishment of such an order consists of inviting all human beings to its path, irrespective of their colour, race, language, nationality or ethnic or historical origin. It stands for total change as against all contemporary ideologies and some religious systems which are content with partial change. Its approach is based upon values and not o¬n the demands of expediency, personal or national. Its outlook is positive and constructive. It seeks man's total welfare-moral, social and economic. It stands for the realization of justice in all aspects of human living. It upholds the principle of universal good and justice and invites all mankind to work for its establishment. It affirms the integrity of the individual and sanctity of his human rights, as rights guaranteed by the Creator, and tries to establish a social order where peace, dignity and justice prevail.
Japan and Islam
The Japan of tomorrow needs a new vision and direction. Structural changes in her society cannot take place except with the adoption of new values and way of life. In this respect, Islamic principles and values can serve to help the Japanese in their social needs today. Japan imports most of her energy from the Islamic world, but needs to equally import and apply Islamic principles. Equality and social justice are what Islam is about; Japanese culture and society can be enriched by interacting with Islamic civilization.
Evidence from an opinion poll taken of average American citizens demonstrates that increasing income cannot guarantee greater happiness: although the average income of the Americans increased five times from 1950 to 1980, their happiness did not correspondingly increase. Materialism, therefore, is not the answer to the Japanese's need for happiness and dignity.
Japan's role in shaping a new international economic order can best be performed when Islamic values and principles are well accepted by Japanese. Then, and o¬nly then, can she play the proper role of helping to build a new world order based o¬n a truly viable, equitable and peaceful world community.
