Category Archives: Japan

(WSJ) Japan’s Biggest Bitcoin Exchange Suspends New Business

(WSJRegulator orders bitFlyer and other cryptocurrency exchange operators to review business practices.

Japan is one of the more friendly environments for bitcoin.
Japan is one of the more friendly environments for bitcoin. PHOTO:ROBICHO/EPA/SHUTTERSTOCK

TOKYO—Japan’s biggest bitcoin exchange said it would halt taking new business after regulators said it wasn’t doing enough to stop money laundering and terrorist financing.

The move by Tokyo-based bitFlyer Inc. led to a drop in the price of the cryptocurrency and highlighted how regulators in Japan, one of the hot spots of cryptocurrency trading, are shifting their stance toward tighter controls.

The Financial Services Agency said it found problems in bitFlyer’s security system including its measures to prevent money laundering and unauthorized access. An agency official said its inspections found problematic accounts such as one registered using a post-office box as a mailing address.

It also said bitFlyer board members who were supposed to monitor management were mostly friends of the chief executive, Yuzo Kano, a former trader at Goldman Sachs who co-founded the company. And the agency said that when bitFlyer registered with the government last year, it provided some false information about its plans to prevent “antisocial forces”—a Japanese euphemism for organized crime—from using the exchange.

BitFlyer apologized to its customers and said it would halt taking new customers until it addressed the regulators’ findings.

“Our management and all employees are united in our understanding of how serious these issues are,” bitFlyer said. Its statement didn’t address the corporate governance issues or the alleged false information, and company representatives didn’t answer calls seeking comment.

A tweet on Mr. Kano’s verified Twitter account didn’t address specific allegations but said, “I take this action seriously and will exert every effort to improve.”

The statement said bitFlyer planned to recheck the identities of existing customers after it found flaws in its earlier processes. It is set to submit its plan for improving its operations to the Financial Services Agency by July 23.

The agency on Friday also issued business-improvement orders to five other cryptocurrency exchange operators.

Japan is one of the more friendly environments for bitcoin. Rules put in place last year established bitcoin as a legitimate payment method in Japan, helping the digital currency flourish in the country. Typically between two-thirds and three-fourths of bitcoin trading is yen-denominated, according to Coinhills.

The FSA, however, has stepped up its warnings against many cryptocurrency exchanges after Japanese exchange Coincheck Inc. was hacked and lost cryptocurrency worth some $530 million in January.

The price of bitcoin fell sharply minutes after the FSA announced its order and the cryptocurrency was trading below $6,400, according to research site CoinDesk. Its low for the year came in early February at just under $6,000. After surging nearly 1,400% last year, bitcoin has lost more than half its value in 2018.

Masanori Kusunoki, chief technology officer at Japan Digital Design Inc. and a member of a Financial Services Agency study group on cryptocurrency exchanges, said the agency was shifting to a tighter stance after initially seeing the new rules as a way to foster innovation in payment systems.

“There’s a trend for regulators around the world to see [cryptocurrencies] increasingly as a method of speculation. And if it is a tool of speculation, they need to respond firmly from the perspective of investor protection,” said Mr. Kusunoki, whose company is part ofMitsubishi UFJ Financial Group Inc.

He said that if exchanges address the problems, there was still room for Japan to be a cryptocurrency leader. “It could actually spur the maturation of the market and ultimately lead to greater competitiveness.”

(Nikkei) Japan shifts course to tighten grip on cryptocurrency exchanges

(Nikkei) FSA focuses on consumer protection as sloppy management comes to light

Nikkei staff writers

Cryptocurrencies such as bitcoin require global regulation, a member of Germany’s central bank argues. © Reuters

TOKYO — Japan’s financial watchdog is stepping up its oversight of cryptocurrency businesses following inspections that revealed their inadequate internal controls, shifting its focus from nurturing financial technology to consumer protection.

The Financial Services Agency on Thursday ordered two cryptocurrency exchange operators, BitStation and FSHO, to suspend operations through April 7. A senior executive at the former was found to have misappropriated customer cryptocurrencies, while the latter failed to appropriately monitor large transactions.

Neither exchange was formally registered with the authorities, as both predate enforcement of the law requiring registration and so are allowed to continue operating while they apply for official recognition. Another five operators, including two registered exchanges, were ordered to improve their operations.

Since February, the FSA has conducted on-site inspections at all 16 of Japan’s unregistered exchange operators and some of its 16 registered exchanges. While these inspections are in progress, the probe so far has shown that systems meant to protect customer assets and data, as well as measures to prevent crimes such as money laundering, are utterly inadequate in most cases.

More reprimands are likely as raids on the exchanges continue. Three unregistered exchanges, including BitStation, have retracted their applications for registration and are expected to shut down.

Japan’s Financial Services Agency reprimanded seven cryptocurrency exchange operators Thursday over security issues.

Japan became the first country requiring exchange operators to register with regulators when a revised fund settlement law took effect last April. The registration process is a good deal less rigorous than the permitting process that upstart banks and insurers must go through, letting new players enter the industry fairly easily.

Yet while the FSA was trying to nurture cryptocurrencies into a means of payment, the market saw them as prime targets for speculation. Traders seeking a quick profit sprang into action, flooding Japan’s exchange operators with more funds than they were equipped to handle.

In principle, exchange operators are expected to possess the knowledge and corporate ethics of both the technology and financial sectors. But in practice, many put profit first amid the cryptocurrency boom, neglecting to put in place the business infrastructure required of a robust financial company.

The FSA said Thursday that it would establish a research group to study how cryptocurrency businesses should be regulated. Likely questions include whether to impose a limit on how long unregistered exchanges may operate or to limit leverage used when trading cryptocurrencies on the margin. The group will also consider regulation of so-called initial coin offerings.

“We’re going to crack down for a bit to rein the industry in,” a senior FSA official said.

(BBG) Japan’s second-largest bank leases new HQ in London

(BBGMove comes despite Brexit decision.

The City of London. Demand for office space still strong despite Brexit.

The City of London. Demand for office space still strong despite Brexit.

Sumitomo Mitsui Financial Group’’s European banking unit has agreed to lease a new European headquarters from British Land and GIC Pte at London’s Broadgate complex.

Japan’s second-largest bank by market value will rent 161,000 sq ft at 100 Liverpool Street, British Land said in a statement on Tuesday.

The company will occupy the first three floors of the building on a 20-year lease. SMBC is the latest bank to confound expectations that Britain’s decision to leave the European Union would dramatically dampen demand for London offices.

Wells Fargo and Deutsche Bank are among those that have secured new premises in the City of London financial district since the Brexit vote. Sumitomo’s decision is a “strong endorsement of London as a global city,” Tim Roberts, British Land’s head of offices, said in the statement. The bank is currently based in two City offices.

(BBG) Coincheck to Repay Users Who Lost Money in $400 Million Hack

(BBG) Japanese cryptocurrency exchange Coincheck Inc. said it will use its own capital to reimburse customers who lost money in Friday’s $400 million theft.

The Tokyo-based company will repay all 260,000 users impacted by the theft of NEM coins, at a rate of 88.549 yen (82 U.S. cents) for each coin, according to a statementposted on its website after midnight local time on Sunday. A total of 523 million coins were stolen, it said.

“The timing of the reimbursement and the application process are currently under consideration,” Coincheck said in the statement. “The source of the refunded money is being carried out using our own capital.”

NEM prices surged 21 percent to $1.03 as of 12:31 p.m. Tokyo time, according to prices on coinmarketcap.com. Other cryptocurrencies including Bitcoin, Ether and Litecoin also gained.

Rising Scrutiny

The announcement came less than 48 hours after the hack was discovered on Friday. The attack shocked Japanese policy makers, who introduced legislation last April precisely to prevent such disasters, and piled pressure on global crypto markets wary of rising scrutiny from regulators.

It was not clear how Coincheck secured the funds necessary to repay customers. Late on Friday, the exchange disclosed that co-founders Koichiro Wada and Yusuke Otsuka owned the majority of shares in the company. Other investors include Tokyo-based venture firm Anri and California-based WiL LLC, according to Otsuka. The startup has about 80 employees and began cryptocurrency operations in 2014, it said.

Coincheck didn’t respond to an email requesting more information and verification of the authenticity of the statement. Multiple phone calls placed to two different numbers went straight to voice mail.

Past Deadline

Coincheck was four months past its deadline for receiving a license necessary to operate, as part of Japan’s new legislature to vet and audit cryptocurrency exchanges. It was allowed to continue operating while awaiting a decision from the Financial Services Agency.

The agency is getting ready to penalize Coincheck in relation to the hack, the Yomiuri newspaper reported on Sunday without saying where it obtained the information. Media reports also said the FSA will ask company officials Sunday about the circumstances leading to the loss, and the security measures in place.

If Coincheck successfully navigates the theft, the turnaround wouldn’t be the first in the cryptocurrency world. Bitcoin exchange Bitfinex also overcame a $69 million heist and last year repaid most customers who lost money in the August 2016 attack.

(ZH) Japan’s Largest Bank Is Preparing For A Bitcoin Exchange Collapse

(ZH) The February 2014 collapse of Tokyo-based bitcoin exchange Mt. Gox was, for more than 24,000 investors around the world, a traumatic event. It also ushered in a two-year crypto bear market that saw the price of a single bitcoin plunge from a peak of $1,200 to a low of around $200 before the torrid bull market of the present day began. And as the bankruptcy and legal issues surrounding the collapse continue to wend through the Japanese legal system, none of these investors have received a single crypto cent of remuneration – despite the ballooning valuation of the exchange’s remaining assets.

Many market observers believe that one of the biggest risks to the current rally would be a similar incident unfolding across another major exchange like Bitfinex or CoinBase’s GDAX.

So in a move that could go a long way toward legitimizing the burgeoning crypto market, Japanese banking behemoth Mitsubishi UFJ Financial Group which is  Japan’s largest financial group and the world’s second largest bank holding company – through its trust and banking unit – is preparing to launch a service that will allow individual investors to secure their bitcoins in the event an exchange should fail again, according to Nikkei Asia Review.

MUFG isn’t the only major global bank seeking to build up its cryptocurrency franchise: Goldman Sachs is reportedly in the process of launching a crypto trading desk. Of course, as observed recerntly, Japan is one of bitcoin’s biggest markets, and its largest exchange, Bitflyer, accounts for nearly 40% of global exchange-based trading.

MFUG’s new trust service would help mitigate what has, in the past, proven to be one of the biggest threats to the crypto market. It will also help Japanese regulators cement their position at the vanguard of crypto’s integration with traditional markets.

Mitsubishi UFJ Trust and Banking is preparing a scheme for protecting holders of cryptocurrencies if the exchanges they use fail – a risk that veteran fans here know all too well.

 

This highlights how Japan’s finance industry seeks to make the most of the opportunities associated with virtual currencies, which the country has taken to in a big way, accounting for around 40% of global bitcoin trading.

 

Japan was also the epicenter of one of the digital currency’s biggest shocks — the 2014 collapse of Mt. Gox, the largest bitcoin exchange at the time.

 

Mitsubishi UFJ Trust will offer a way to keep exchange customers’ cryptocurrency holdings separate from the entrusting exchange’s assets. This will make it the first trust arrangement of its kind in the world, according to the Mitsubishi UFJ Financial Group member, which recently applied for patent protection.

Per Nikkei, the service could launch as early as April, when Japan’s Financial Services Agency is expected to recognize cryptocurrencies as an asset that can be placed in trust, like real estate or securities.

While the market value of major cryptocurrencies has ballooned to $300 billion, bitcoin and its peers have remained remain decentralized creations without an oversight body like a central bank – a core component of their appeal. But as the usage and valuation of digital currencies grows, these exchanges, which are often overwhelmed and under-staffed by the flurry of new accounts, they’re increasingly becoming targets for state-sponsored hackers like the North Korea linked Lazarus Group.

As Nikkei explains, Mitsubishi UFJ Trust will maintain the same records as its exchange clients. In the event that the exchange operator fails to safeguard its customers’ assets, Mitsubishi UFJ will use these records to compensate investors for their losses.

Of course, this service won’t protect customers from violent plunges in the valuation of bitcoin, like the selloff that occurred over the weekend during the runup to the Christmas holiday.

Using an arrangement like Mitsubishi UFJ Trust’s would entail a fee that would be shouldered by individual investors. But “customers will feel peace of mind knowing that a trust bank is managing their assets,” said CEO Noriyuki Hirosue of Tokyo-based exchange Bitbank. After all, the big banks have never violated their fiduciary duty to their clients – therefore, they’re implicitly more trustworthy than crypto startups with few resources and little to no track records.

To use the service, exchange customers will opt in when they start trading. Mitsubishi UFJ Trust will monitor the accounts of those who do for suspicious activity and examine pending transactions in detail as needed. A late-night sale of a huge amount of bitcoins, for instance, would get flagged for inspection instead of being processed immediately.

While regulators in the US have expressed skepticism about digital currencies, Japan established itself as a leader in building a regulatory framework when nearly two years ago, it passed a law clearing the way for financial institutions to become involved in the crypto market.

The Japanese recognize the adoption of cryptocurrencies and blockchain technologies as a competitive advantage, and they’re right. The FSA began registering cryptocurrency exchanges in earnest this past autumn.

Offering this service will help establish one of Japan’s largest financial institutions as a key player in an increasingly contested global market, which has seen a surge of institutional interest in the trading of cryptocurrencies in recent months.

(P-S) Japan’s Demographic Lessons for Europe – DANIEL GROS

(P-S) Contrary to popular belief, Japan has been extraordinarily successful in achieving economic growth, given its rapidly aging population and lack of inflation. For Europe, where the demographic future looks a lot like Japan’s past, there is much to be learned from this experience.

BRUSSELS – Demography is not destiny, at least not entirely. Over centuries, policy can affect fertility decisions, and migration can transform a country, as the experience of the United States shows. Over shorter time horizons, however, demographic trends must be taken as given, and can have a profound impact on growth. Yet demographic factors are often neglected in economic reporting, leading to significant distortions in assessments of countries’ performance. Nowhere is this more apparent than in Japan.

With real output – the key measure of economic performance – having risen by only about 15% since 2000, or less than 1% per year, Japan easily seems the least dynamic of the worlds’ major economies. But given Japan’s demographics – the country’s working-age population has been shrinking by almost 1% per year since the start of this century – this result is remarkable.

In fact, Japan’s growth rate per working-age person was close to 2% – much higher than in the US or in Europe. Though the US economy grew more than 35% since 2000, its working-age population also grew markedly, leaving the annual growth rate per working-age person at only about 1%.

That indicator – growth rate per working-age person – is not widely used by economists, who instead focus on GDP per capita. By that measure, Japan is doing about as well as Europe and the US. But, while per capita indicators are useful for assessing a country’s consumption potential, they do not provide an adequate picture of growth potential, because they include the elderly and the young, who do not contribute to production. Even in Japan, with its high life expectancy, those over the age of 70 do not contribute much to output.

So, given its rapidly declining potential, Japan has been extraordinarily successful. A key reason is that it has put a growing proportion of its working-age population to work: unemployment is today at a record low of less than 3%, and almost 80% of those who could work have a job, compared to about 70% for Europe and the US.

Japan’s achievement of full employment and high job growth over the last two decades is all the more noteworthy in view of near-permanent deflation during this period (most prices are still lower today than they were 15-20 years ago). This should give food for thought to those who maintain that deflation imposes unbearable economic costs.

The Japanese experience holds important lessons for Europe, where the demographic future looks a lot like Japan’s past. The eurozone’s working-age population has not grown at all in recent years, and will soon start to decline at a rate similar to Japan’s over the last generation. It seems unlikely that immigration will alter the trend. In recent years, Europeans, like Japanese, have proven to be highly resistant to large-scale immigration, which is what would be required to offset demographic decline.

Moreover, the eurozone has now settled on a current-account surplus of around 3% of GDP. That is similar to the level long seen in Japan (except for the short period in the aftermath of the 2011 Fukushima Daiichi nuclear meltdown).

A first lesson of Japan’s experience is that, despite the eurozone’s difficulty generating inflation in an aging society characterized by excess savings, growth is not necessarily out of reach. Rather, given Japan’s record of growth without inflation, the European Central Bank should recognize that its target of “close to 2%” inflation might not be so important after all. In any case, the particularities of the eurozone’s structure mean that the ECB will have no choice but to halt its bond-buying operations in a year or so. This means that the ECB will not be able to follow in the footsteps of the Bank of Japan, which continues to purchase large volumes of government bonds, without any visible pick-up in inflation.

Another lesson from Japan is that a country with a large savings surplus can handle a large public debt, because it can be financed internally. That does not necessarily mean that it is desirable to run up the debt. Japan’s debt-to-GDP ratio now exceeds 150% of GDP (taking into account the large financial assets of the government-owned savings institutions), and continues to rise, owing to large fiscal deficits.

This brings us to a final key lesson from Japan: in a low-growth economy, the debt-to-GDP ratio can quickly spin of out control. Fortunately, it seems that this lesson already has been learned, with the average deficit in the eurozone now amounting to only around 2% of GDP. The deficit cap imposed by the Stability and Growth Pact (3% of GDP) seems to have had at least some impact in terms of stabilizing the debt ratio.

The structure of the eurozone imposes limits on the use of both fiscal and monetary policy. This should prevent the excessive build-up of debt, ultimately making it easier for the eurozone to manage a future in which the only way to sustain growth is to capitalize fully on the economy’s declining demographic potential.

(BBG) Abe Calls Snap Election in Japan, Readies $18 Billion Package

(BBG) Japan’s Prime Minister Shinzo Abe said he’ll dissolve the lower house of parliament on Sept. 28 for a general election as he announced an $18 billion economic package.

At a press conference Monday, Abe unveiled a slew of economic measures including more education spending. He said he’d pay for them with funds from a consumption tax increase originally intended to rein in the nation’s swollen debt. He also spoke about the need to keep up pressure on North Korea after Kim Jong Un’s regime fired two missiles over Japan in recent weeks.

Shinzo Abe speaks on September 25.

Photographer: Akio Kon/Bloomberg

“To increase investment in future generations, I decided today to change the way we had promised to use the sales tax,” Abe said. “I am changing a pledge that was made to the public, and one that affects people’s livelihoods, so I must swiftly seek the will of the people.”

Election Date

Voting will be set for Oct. 22, according to three people with knowledge of his ruling coalition’s plans. Heightened tensions with North Korea have boosted Abe’s approval rating after a series of scandals, and may help him retain his coalition’s two-thirds majority in the lower house of parliament.

“An election in these circumstances will also be a test of confidence in me,” Abe said, adding that he’d resign if his ruling coalition failed to get a simple majority.

The yen pared a drop as Abe unveiled the stimulus package and called the election.

Ahead of Abe’s remarks, Tokyo Governor Yuriko Koike announced that she would form a new national party to challenge him. Koike, a former member of Abe’s Liberal Democratic Party, said Monday that her “Party of Hope” would run candidates across the nation.

Abe announced Monday he had ordered a 2 trillion yen ($18 billion) economic package, including spending on preschool and higher education, as well as improving conditions for people working in elderly care. The premier said he would make use of revenues from a planned increase in the nation’s consumption tax in October 2019 to 10 percent from 8 percent now.

He reiterated his strong line on North Korea, saying the current situation on the Korean peninsula was among his reasons for calling the election.

“Elections, which are the foundation of democracy, must not be affected by North Korea’s threats,” he said. “By holding an election at this time, I want to ask the people’s view on how we are dealing with North Korea.”

Following the announcement, public broadcaster NHK said LDP Vice President Masahiko Komura wouldn’t stand in the election., without providing a reason.

Opinion Polls

poll published in the Nikkei newspaper on Monday said Abe’s LDP received 44 percent of support, compared to 8 percent for both Koike’s group and the main opposition Democratic Party. Another survey by Kyodo News published on Sunday showed the LDP with a more than three-to-one margin against its closest rival, with 42 percent still undecided.

While the Democratic Party is splintering, Koike has a history of local election victories over the premier’s party. After defecting from the LDP, she crushed it in a July election for the metropolitan assembly. Komeito’s Yamaguchi said he hoped she would concentrate on her post in Tokyo.

Abe has served a total of almost six years as prime minister: he had a truncated term a decade ago, and came back to power in a landslide in 2012. He could serve until 2021 if re-elected as party leader next year, making him the longest-serving prime minister in Japanese history, though recent polls have shown a majority of voters against this idea.

The Nikkei poll showed that 20 percent were undecided, and a majority said it was inappropriate for Abe to dissolve the lower house this month — more than a year before his government’s term is set to expire. Nikkei Research Inc. surveyed 1,044 people aged 18 or older by phone.

Kyodo reported that its survey conducted over the weekend showed 27 percent of respondents saying they would vote for Abe’s LDP, compared with 8 percent for the Democratic Party. Sixty-four percent said they don’t support his drive for a fresh mandate, the report said, without giving details on the number of respondents or margin of error.

Abe’s support is likely to be buoyed by the economy, which has grown for six straight quarters. While unemployment is less than 3 percent, the premier has said wage rises haven’t met his expectations.

Koike’s Concerns

Tokyo Governor Koike said Monday people did not have a real sense that the economy was improving, and warned that raising the sales tax would pose a risk. She also said debate on constitutional reform should not be avoided.

“We need a real force for reform,” Koike told reporters in Tokyo. “By making my position clear, I hope to add energy to the movement,” she added. The new party’s policies will include cutting the number of lawmakers and their pay, improving transparency in government and female empowerment.

The ruling coalition currently controls 68 percent of seats in the 475-member lower house, including 288 for the LDP and 35 for its coalition partner Komeito, according to the parliamentary website. The total number of seats is set to be cut to 465 in the next election as part of a reform aimed at reducing the excessive weight given to rural votes under the current system.

(BBG) North Korea Puts Guam in Range With Missile Test Over Japan

(BBG) North Korea’s second missile launch over Japan in as many months flew far enough to put the U.S. territory of Guam in range, a provocation that comes days after the United Nations approved harsher sanctions against Kim Jong Un’s regime.

The intermediate-range missile fired from Pyongyang at 6:57 a.m. on Friday flew over the northern island of Hokkaido, reaching an altitude of 770 kilometers (478 miles) before landing in the Pacific Ocean. It traveled 3,700 kilometers (2,300 miles) — further than the 3,400 kilometers (2,100 miles) from Pyongyang to Guam, which North Korea has repeatedly threatened.

“The range of this test was significant since North Korea demonstrated that it could reach Guam with this missile, although the payload the missile was carrying is not known,” David Wright, a co-director of the Union of Concerned Scientists, wrote in a blog post.

North Korea, which has fired more than a dozen missiles this year, had pledged to retaliate after the UN Security Council punished the country for its sixth and most powerful nuclear test on Sept. 3. Investors largely shrugged it off on Friday, showing that financial markets are growing accustomed to North Korea’s provocations and the responses of the U.S. and its allies.

North Korean foreign ministry official told reporters at Beijing’s international airport that Friday’s launch was a “normal part of strengthening our nuclear deterrent,” according to NHK.

The Japanese public broadcaster cited Choe Kang Il, deputy director general for North American affairs, as saying North Korea wouldn’t enter dialogue unless the U.S. stops antagonizing his nation. Choe was on his way back from Switzerland, where he attended a meeting on Northeast Asian security.

U.S. President Donald Trump was briefed on the missile launch but made no mention of North Korea in remarks at a White House dinner on Thursday night. The president has said all options — including military — are on the table to stop North Korea from obtaining the ability to strike the U.S. with a nuclear weapon, and has questioned the usefulness of talks.

“These continued provocations only deepen North Korea’s diplomatic and economic isolation,” U.S. Secretary Rex Tillerson said in a statement. He reiterated a call for China and Russia to take action against the rogue state, saying: “China supplies North Korea with most of its oil. Russia is the largest employer of North Korean forced labor.”

Here Are the Options for Dealing With North Korea: QuickTake Q&A

On Monday, the UN Security Council approved new sanctions after the U.S. dropped key demands such as an oil embargo to win support from Russia and China, both of which can veto any proposals. The resolution seeks to limit oil imports, ban textile exports and increase inspections of ships suspected of carrying cargo in breach of sanctions.

The council plans to convene on Friday in New York at 3 p.m. local time. China’s foreign ministry spokeswoman Hua Chunying said her nation was not at the core of the North Korea problem.

China would continue to strictly implement UN resolutions on North Korea, she said. “It’s irresponsible and unhelpful to unjustly blame others and shirk responsibilities in any form.”

On Thursday, North Korea had threatened to sink Japan “into the sea” with a nuclear strike and turn the U.S. into “ashes and darkness” for agreeing to the latest UN sanctions.

“We are in an ever worsening cycle of escalation and time is on North Korea’s side,” said Daryl Kimball, executive director of the Washington-based Arms Control Association, who said the country’s technicians are getting better. “So long as the war of words continues and the lack of communications continues, there is an increasing risk that one side or another miscalculates and we have a situation that can lead to military conflict.”

South Korean President Moon Jae-in used his strongest language yet to condemn the latest test. “We have the power to smash North Korea into powder and put it beyond recovery if it provokes us or our alliance,” he said before chairing a National Security Council meeting.

Read More: Smugglers on China-North Korea Border Undercut Sanctions

South Korea’s military said it simultaneously conducted a drill in which it fired a ballistic missile into the East Sea, also known as the Sea of Japan.

Moon suggested to Japanese Prime Minister Shinzo Abe that the two countries refrain from overreacting to North Korea’s provocations to avoid any accidental conflict, Moon’s office said in a text message Friday. Moon said he “completely agrees” with Abe to firmly respond to the threats but the two countries should cooperate to manage the situation in a stable way to avoid “a possible accidental conflict,” his office said.

Moon also told Abe that South Korea will consider the timing of humanitarian aid it plans to provide for pregnant women and children in North Korea through international organizations, given the continued provocations, and will ensure goods will be used as intended.

Japan didn’t try to shoot down the North Korean missile on Friday, and the situation was similar to when a missile was fired over the country on Aug. 29, government spokesman Yoshihide Suga told reporters. North Korea had called that test a “meaningful prelude” to containing Guam, and threatened to launch more missiles over Japan into the ocean.

In July, North Korea fired two intercontinental ballistic missiles on steep trajectories into the sea between the Korean peninsula and Japan. The regime said those launches put the entire U.S. in its range.

Abe said a unified international response against North Korea was needed now more than ever, reiterating that the isolated nation had “no bright future” if it continues on its current path.

Market Reaction

Japan’s benchmark Topix index rose 0.4 at the close in Tokyo, while the yen flat-lined after an initial jump before heading lower.

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“I wouldn’t necessarily say this is an escalation,” said James Soutter, a portfolio manager at K2 Asset Management in Melbourne. “This is more of a continuance of provocation. Hence markets won’t like it, but I don’t think it’s necessarily the precursor to a sustained market pullback.”

North Korea’s first nuclear test since Trump took office was a “perfect success” and confirmed the precision and technology of the bomb, according to the Korean Central News Agency. Kim claimed that his regime could mount a hydrogen bomb onto an ICBM.

While North Korea’s ICBM threat is growing, the U.S. military says it’s not yet imminent. Kim’s regime has yet to demonstrate that it can accurately guide a long-range missile to a target with a nuclear warhead that survives the trip, General Paul Selva, the No. 2 U.S. military official said in a statement to Bloomberg last month.

(Reuters) After North Korea missile, Britain and Japan agree closer security ties

(Reuters) Britain and Japan said on Thursday they would cooperate in countering the threat posed by North Korea, two days after it fired a missile over northern Japan, and will call on China to exert its leverage.

Prime Minister Theresa May, looking to strengthen relations with one of her closest allies ahead of Brexit, is visiting Japan as it responds to an increasing military threat.

Terming North Korea’s missile programme “a global threat”, Prime Minister Shinzo Abe told a news conference that Japan and Britain would cooperate.

“It is very meaningful that Prime Minister May and I agreed to further strengthen pressure on North Korea and to call on China to play a larger role,” he added.

May agreed, noting that China, North Korea’s lone major ally, had been involved in U.N. Security Council debate earlier this week.

“China does have a particular position in this, they have leverage on North Korea and I believe we should be encouraging China to exercise that leverage to do what we all want – which is to ensure that North Korea is not conducting these illegal acts.”

May toured Japan’s flagship Izumo helicopter carrier for a military briefing with Minister of Defence Itsunori Onodera before attending a national security meeting.

May and Abe agreed on a joint declaration on security cooperation, including plans for British soldiers to take part in military exercises on Japanese soil and for collaboration to address the threat of cyber and militant attacks when Japan hosts the Olympics in 2020.

North Korea featured heavily in the talks after it launched a ballistic missile on Tuesday that passed over Japanese territory, prompting international condemnation.

May’s office had said the two leaders were expected to discuss the possibility of further sanctions on North Korea, but neither Abe nor May touched on the issue at the news conference.

The Global Times, a publication of the official People’s Daily of China’s ruling Communist Party, criticised an earlier comment of May’s comment calling for more pressure from China.

“Beijing does not need London to teach it how to deal with North Korea,” the newspaper said.

Asked about the United States, Japan and Britain looking to impose new sanctions on North Korea, Chinese Foreign Ministry spokeswoman Hua Chunying said the situation could only be resolved peacefully through dialogue.

“We think it is regrettable that some countries selectively overlook the relevant Security Council resolutions’ demand to advance dialogue, and stubbornly emphasise pressure and sanctions,” she told a daily news briefing.

‘OUTWARD-LOOKING’

Apart from security, May’s trip has focused on trade and investment. She is keen to convince nervy investors that Britain’s exit from the European Union will not make it a less attractive business partner.

Both May and Abe addressed a delegation of British business leaders and senior representatives from major Japanese investors in Britain, such as carmakers Nissan, Toyota and conglomerate Hitachi.

Abe told the gathering that May had assured him Britain’s negotiations on leaving the European Union would be transparent.

May said Japanese investment after Britain’s vote to leave the EU was a vote of confidence and she pledged to build close trade ties with Japan.

“I very much welcome the commitment from Japanese companies such as Nissan, Toyota, Softbank and Hitachi,” May said.

“I am determined that we will seize the opportunity to become an ever more outward-looking global Britain, deepening our trade relations with old friends and new allies.”

During a two-hour train ride between Kyoto and Tokyo late on Wednesday, the two leaders discussed Brexit, with May talking Abe through the details of a series of papers published in recent weeks setting out her negotiating position.

May said on Wednesday Japan’s upcoming trade deal with the EU could offer a template for a future Japan-Britain trade agreement, the latest attempt to show investors that Brexit will not lead to an overnight change in business conditions.

Japan has been unusually open about its concerns over Brexit, worrying that 40 billion pounds of Japanese investment in the British economy could suffer if trading conditions change abruptly when Britain leaves the bloc.

+++ P.O. (BBG) North Korea Fires Missile Over Japan, Renewing Asia Tensions

P.O.

I am afraid this will end in the worst possible way of all.

All indications unfortunately point in that direction.

The essencial objective of the North Korea regime has always been, since it’s inception, to arrive at this military capacity.

It has no other main drive, as far as I can see.

So, and considering that we are dealing with people totally alienated from reality, the odds are that the regime will test it’s objective,it’s “raison d´être”.

From their point of view , as far as I understand it,not to test it would render the regime useless, and pointless.

I am sorry not to have better news.

Francisco (Abouaf) de Curiel Marques Pereira

(BBG) North Korea fired an unidentified ballistic missile over Japan on Tuesday, rattling Asian markets as the U.S. and its allies weighed a response to Kim Jong Un’s latest provocation.

Abe speaks to the media on Aug. 29.

Photographer: STR/AFP via Getty Images

The missile landed in the Pacific Ocean about 1,200 kilometers (745 miles) east of Japan’s northern island of Hokkaido, Chief Cabinet Secretary Yoshihide Suga told reporters. South Korean President Moon Jae-in ordered a show of force in response, with four F-15K jet fighters conducting bomb-dropping drills.

“A missile passing over Japan is an unprecedented, grave and serious threat,” Prime Minister Shinzo Abe told reporters in Tokyo. Abe said he spoke with President Donald Trump for 40 minutes, and they agreed to increase pressure on North Korea. He also called for China and Russia to take action.

There was no statement from the White House or Trump tweet in the hours after the launch.

It was the first North Korean projectile to fly over Japanese airspace since the regime launched a rocket over Okinawa in 2016, and undermines nascent hopes for dialogue with North Korea. That’s after tensions had appeared to cool following a war of words between Trump and Kim earlier this month.

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With sanctions having little impact and any war likely to be catastrophic, the U.S. and its allies have few good options to stop Kim from obtaining the capability to hit North America with a nuclear weapon. Russian Deputy Foreign Minister Sergei Ryabkov said “it’s already obvious to everyone that the resource of sanctions pressure is exhausted.”

“North Korea is acting as if it’s a nuclear weapons state,” John Park, director of the Korea Working Group at Harvard Kennedy School, told Bloomberg Television. “You can draw any number of red lines; in North Korea’s mind they’re on the cusp of getting itself the capabilities that are in the realm of the great powers.”

‘Source of Headache’

The state-run Korean Central News Agency mocked and goaded Trump in a commentary that didn’t reference the missile. It called the U.S. president “the source of headache at home and abroad” and said his policies were “either ignored or delayed” and he was snubbed by other Western leaders.

China urged countries involved to refrain from provoking each other, Foreign Affairs spokeswoman Hua Chunying said on Tuesday at a regular briefing in Beijing. “The facts have proven that pressure and sanctions cannot fundamentally solve the issue,” she said. “The only way out is through dialogue and consultation.”

South Korean stocks led regional losses, with the Kospi index sliding as much as 1.6 percent before closing 0.2 percent lower. Safe haven assets from gold to Treasuries and the yen advanced.

Read more: North Korea defies the world with nuclear ambitions

Trump spoke with Abe and last week said Kim was “starting to respect us,” a shift in tone after he vowed earlier in the month that threats from North Korea would be met with “fire and fury.” He has previously said military force is an option to prevent Kim from gaining a nuclear-tipped intercontinental ballistic missile.

North Korea has said it won’t place its nuclear program on the negotiating table unless the U.S. drops its “hostile” policies. It has strongly protested annual military exercises now underway between the U.S. and South Korea, saying they are aimed at regime change and could spark an accidental war.

After North Korea fired three short-range missiles on Saturday, Secretary of State Rex Tillerson continued to push for dialogue with North Korea. South Korea also urged talks.

Following the launch on Tuesday, Japan asked the United Nations Security Council to hold an emergency meeting and said now wasn’t the time for dialogue.

“This will make it more difficult for the U.S. to get Japanese support for diplomacy, unfortunately, at exactly the time when the situation is heating up,” said David Wright, a co-director of the Union of Concerned Scientists. He called the launch a “big deal,” saying North Korea previously tested missiles at a high trajectory to avoid flying over Japan.

The missile was launched from near Pyongyang, traveled 2,700 kilometers in an easterly direction and reached an altitude of 550 kilometers, South Korea’s military said.

It was likely an intermediate-range ballistic missile, according to Japanese Defense Minister Itsunori Onodera. Japan didn’t shoot it down after an assessment that it wasn’t aimed at its territory.

Pyongyang had threatened earlier this month to fire a missile over Japan toward the U.S. territory of Guam, which prompted threats of retaliation from American military officials.

Japanese Foreign Minister Taro Kono told reporters that the launch of a missile to the east, rather than south towards Guam, showed Pyongyang “flinched” in the face of U.S. warnings.

North Korea has shown recent advancements in its technology by testing ICBMs at high altitudes, reflecting progress toward being able to reach the continental U.S. with a nuclear warhead. That has happened despite further international sanctions aimed at squeezing Kim’s economy.

Missile Defense

“They flew the missile over Japan because they felt the need to test a missile over a longer range,” said Ralph Cossa, president of the Pacific Forum CSIS in Honolulu. “By firing it into the North Pacific, it makes it harder to recover the pieces and warheads than if they flew it toward Guam.”

Japan and South Korea have both stepped up their efforts on missile defense. After the latest launch by North Korea, Seoul released footage of tests last week of its own ballistic missiles, according to Yonhap News. China has voiced opposition to its neighbors beefing up missile defenses, saying they could also be used to counter its own capabilities.

While China backed UN sanctions earlier this month that crimped a third of North Korea’s exports, it has resisted cutting off food and fuel supplies that are vital to the survival of Kim’s regime. China is wary of doing anything that would lead to North Korea’s collapse, a scenario that could potentially destabilize its economy and put U.S. troops directly on its border.

Trump may see more success at getting North Korea to halt testing by sending an envoy directly to Pyongyang, said John Delury, an associate professor of Chinese studies at Yonsei University in Seoul.

“The road to Pyongyang does not go via Beijing,” he said. “It goes straight from Washington to Pyongyang.”

+++ P.O. (FT) Japan’s new missile shield against N Korea

P.O.

If I were in charge in Japan I would not install one missile shield.

I would install several…!

When you are dealing with an obviously mentally deranged person, anything is possible.

Francisco (Abouaf) de Curiel Marques Pereira

 

Japan is planning to install a new land-based missile defence shield as it scrambles to address the rising threat of North Korea’s nuclear weapons programme with improvements to its defence capabilities.

 

(Japan News) China regains spot as largest foreign lender to U.S. govt

(Japan News) China purchased the most Treasuries in six years in June, vaulting past Japan as the largest overseas lender to the U.S. government, according to data released by the U.S. Treasury Department on Tuesday.

The world’s second biggest economy has steadily ratcheted up its accumulation of U.S. government debt as it has seen a sharp reduction in capital outflows.

In 2016, China spent nearly $320 billion of foreign exchange reserves in an effort to stem the yuan’s depreciation against the U.S. dollar.

In the wake of tighter capital controls and a weaker dollar so far this year, China’s forex reserves, the world’s biggest, have grown in line with its Treasuries holdings.

In June, its reserves increased by $3.2 billion to $3.057 trillion, an eight-month high, while its Treasuries holdings rose to $1.147 trillion, which was the highest level since September when it was $1.157 trillion.

In July, China’s currency reserves reached a nine-month peak at $3.081 trillion.

Before China returned to being the largest U.S. overseas lender, Japan had held that spot for eight months.

Japan held $1.091 trillion in U.S. government debt in June, down from $1.111 trillion in May.

Japan’s drop in Treasuries holdings was the steepest since November, falling to a level last seen in December.

Ireland was a distant third in holdings of Treasuries, with $302.5 billion in June, up from $295.8 billion in May.

Overall, foreign investors bought $19.73 billion in Treasuries in June, down from $46.37 billion in May, which was the most since June 2015.

(Fox News) US, Japanese troops begin joint military exercise amid North Korea threat

(Fox News)

More than 3,500 American and Japanese troops kicked off a weeks-long joint military exercise Thursday against the backdrop of an increasingly belligerent North Korean regime.

The exercise, known as Northern Viper 17, will take place on Hokkaido — Japan’s northern-most main island — and will last until Aug. 28.

According to the U.S. Pacific Command, the drill will include 500 Marines and 18 aircraft operating out of the 35th Fighter Wing at Misawa Air Base, on the northern tip of the island of Honshu.

“We are improving our readiness not only in the air, but as a logistical support team,” Col. R. Scott Jobe, the 35th Fighter Wing commander, said in a statement. “We are in a prime location for contingency purposes and this exercise will only build upon our readiness in the case a real-world scenario occurs.”

The exercise began hours after Japan’s defense minister said the Japanese military could shoot down North Korean intercontinental ballistic missiles before they reach the U.S. territory of Guam.

Itsunori Onodera told Japan’s parliament, or Diet, that a North Korean attack against Guam would be considered an existential threat to the country and give Japan the right to activate its Aegis destroyer missile defense system.

Japan lies only about 620 miles to the east of North Korea, which has conducted numerous missile tests this year. Most of the weapons have landed in the Sea of Japan.

(BBC) The truth about Japanese tempura

(BBC) When 16th-Century Portuguese came to Japan, they brought a special dish with them. Today, in Japan, it’s called tempura and has been a staple of the country’s cuisine ever since.

In 1543, a Chinese ship with three Portuguese sailors on board was headed to Macau, but was swept off course and ended up on the Japanese island of Tanegashima. Antonio da Mota, Francisco Zeimoto and Antonio Peixoto – the first Europeans to ever step on Japanese soil – were deemed ‘southern barbarians’ by the locals because of the direction from which they came and their ‘unusual’, non-Japanese features. The Japanese were in the middle of a civil war and eventually began trading with the Portuguese, in general, for guns. And thus began a Portuguese trading post in Japan, starting with firearms and then other items such as soap, tobacco, wool and even recipes.

In 1543, three Portuguese sailors were the first Europeans ever to set foot on Japanese soil (Credit: Credit: G. DAGLI ORTI/Getty Images)

In 1543, three Portuguese sailors were the first Europeans ever to set foot on Japanese soil (Credit: G. DAGLI ORTI/Getty Images)

The Portuguese remained in Japan until 1639, when they were banished because the ruling shogun Iemitsu believed Christianity was a threat to Japanese society. As their ships sailed away for the final time, the Portuguese left an indelible mark on the island: a battered and fried green bean recipe called piexinhos da horta. Today, in Japan, it’s called tempura and has been a staple of the country’s cuisine ever since.

No-one knows the exact origins of peixinhos da horta. “We know it existed in 1543,” said Michelin-starred chef Jose Avillez when I met up with him at Cantinho de Avillez, one of his acclaimed Lisbon restaurants. “But before that, it’s anyone’s guess.”

Green beans, it turns out, changed food history.

The Portuguese left an indelible mark on Japan: a fried green bean recipe called piexinhos da horta (Credit: Credit: PhotoCuisine RM/Alamy Stock Photo)

The Portuguese left an indelible mark on Japan: a fried green bean recipe called piexinhos da horta (Credit: PhotoCuisine RM/Alamy Stock Photo)

However, peixinhos da horta was only one of many dishes the Portuguese inspired around the world. In fact, Portuguese cuisine, still heavily overshadowed by the cuisines of Italy, Spain and France, may be the most influential cuisine on the planet.

Portuguese cuisine may be the most influential cuisine on the planet

When the Portuguese turned up in Goa, India, where they stayed until 1961, they cooked a garlicky, wine-spiked pork dish called carne de vinha d’alhos, which was adopted by locals to become vindaloo, one of the most popular Indian dishes today. In Malaysia, several staples, including the spicy stew debal, hail from Portuguese traders of centuries past. Egg tarts in Macao and southern China are direct descendants to the egg tarts found in Lisbon bakeries. And Brazil’s national dish, feijoada, a stew with beans and pork, has its origins in the northern Portuguese region of Minho; today, you can find variations of it everywhere the Portuguese have sailed, including Goa, Mozambique, Angola, Macau and Cape Verde.

The Portuguese inspired cuisines around the world, including India, including India, Goa (pictured) and Malaysia (Credit: Credit: Frank Bienewald/Getty Images)

The Portuguese inspired cuisines around the world, including India, including India, Goa (pictured) and Malaysia (Credit: Frank Bienewald/Getty Images)

Peixinhos da horta were often eaten during Lent or Ember days (the word ‘tempura’ comes from the Latin word tempora, a term referring to these times of fasting), when the church dictated that Catholics go meatless. “So the way around that,” Avillez said, “[was] to batter and fry a vegetable, like the green bean. And just to add to it, we called it peixinhos do horta, little fish of the garden. If you can’t eat meat for that period of time, this was a good replacement.”

The word ‘tempura’ comes from the Latin word tempora

And it had other functions too. “When the poor couldn’t afford fish, they would eat these fried green beans as a substitute,” Avillez said. And sailors would fry the beans to preserve them during long journeys, much in the way humans have been curing and salting meat for preservation purposes for centuries.

Perhaps not constricted by tradition, the Japanese lightened the batter and changed up the fillings. Today, everything from shrimp to sweet potatoes to shitake mushrooms is turned into tempura.

“The Japanese inherited the dish from us and they made it better,” Avillez said.

Avillez said Japanese people sometimes turn up at his restaurants and see the fried bean dish and say, “Hey, Portuguese cuisine is influenced by Japanese cuisine.” He added, “And that’s when I say, ‘No, in this case it’s the other way around’.” A Japanese-born sous chef at Avillez’s two-Michelin-starred Lisbon restaurant, Belcanto, even chose to train in Portugal instead of France because he recognised the influence on his home cuisine, particularly in peixinhos da horta.

In Japan, it’s called tempura and has been a staple of the country’s cuisine ever since the Portuguese arrival in 1543 (Credit: Credit:Lucas Vallecillos/Alamy)

In Japan, it’s called tempura and has been a staple of the country’s cuisine ever since the Portuguese arrival in 1543 (Credit:Lucas Vallecillos/Alamy)

Avillez said his one complaint about the dish, in general, has always been that the beans are often fried in the morning and so they go cold and limp by the time they get to the table later that day. He remedies this by not only cooking them on demand, but by adding a starch called nutrios that keeps them crispy. After the bean is blanched, it gets rolled in the batter of wheat flour, egg, milk, and nutrios and then flash fried.

Other chefs I talked to in Portugal had their own recipes for the fried green beans, but they didn’t deviate much. “It’s a very simple dish,” said chef Olivier da Costa, when I met up with him at his Lisbon restaurant Olivier Avenida, located in the Avani Avenida Liberdade hotel. “I use a batter of flour, milk, eggs, salt, pepper and beer,” he said. “Beer?” I asked. “Yes! It ferments the batter and the beer foam gives it a better taste.” He didn’t have the dish on his menu at the time so I had to take his word for it.

One reason why Portuguese love peixinhos da horta so much, da Costa said, was nostalgia. “We all eat it as children and thus have fond memories of it. These days it’s been making a comeback, not just because people are eating more vegetarian food, but because a younger generation are taking more interest in our local cuisine and because they want to be taken back to that simpler time.”

Michelin-starred chef Jose Avillez believes the Japanese made the dish lighter and better when they inherited it (Credit: Credit: David Farley)

Michelin-starred chef Jose Avillez believes the Japanese made the dish lighter and better when they inherited it (Credit: David Farley)

Avillez is taking this newfound interest in super traditional Portuguese cuisine to a new level. Along with his Japanese-born sous chef, he plans to temporarily offer a tasting menu called ‘1543’, the year the Portuguese first showed up in Japan, offering peixinhos da horta and other Portuguese dishes that have inspired Japanese cuisine. Alongside the Portuguese dishes, he plans to serve the Japanese versions that evolved from the Portuguese presence in Japan four-and-a-half centuries ago.

Each bite was like taking a first bite

Back at Cantinho de Avillez, an order of peixinhos da horta appeared in front of me. They were rigid like pencils with a lumpy texture and a yellow-ish hue. Each bite was like taking a first bite: crisp, light and super flavourful, the crunchy texture of the batter complimenting the sturdy feel of the bean. The dish has been one of the only consistent items on the menu at Cantinho de Avillez, which opened in 2012.

“I can’t take it off,” Avillez said. “My regulars would be enraged.”

(Reuters) Australia, Japan, U.S. call for South China Sea code to be legally binding

(Reuters) Australia, Japan and the United States on Monday urged Southeast Asia and China to ensure that a South China Sea code of conduct they have committed to draw up will be legally binding and said they strongly opposed “coercive unilateral actions”.

The Association of South East Asian Nations (ASEAN) and China should establish a set of rules that were “legally binding, meaningful, effective, and consistent with international law,” the foreign ministers of the three countries said in a statement following a meeting in Manila.

Foreign ministers of ASEAN and China on Sunday adopted a negotiating framework for a code of conduct, a move they hailed as progress but seen by critics as a tactic to buy China time to consolidate its maritime power.

Australia, Japan and the United States also “voiced their strong opposition to coercive unilateral actions that could alter the status quo and increase tensions”.

They also urged claimants to refrain from land reclamation, construction of outposts and militarization of disputed features, in a veiled reference to China’s expansion of its defence capability on Mischief, Fiery Cross and Subi reefs in the Spratly archipelago.

The three countries are not claimants but have long been vocal on the issue, arguing their interest is in ensuring freedom of navigation and overflight.

They urged China and the Philippines to abide by last year’s international arbitration ruling, which invalidated China’s claim to almost the entire South China Sea, where more than $3 trillion worth of sea-borne goods pass every year.

Brunei, Malaysia, the Philippines, Taiwan and Vietnam also have competing claims there.

The code framework is an outline for what China and ASEAN call “consultations” on a formal agreement, which could start later this year. China’s foreign minister, Wang Yi, on Sunday said that hinged on whether the situation was stable, and if there was no “major interference” from outsiders.

Several ASEAN countries want the code to be legally binding, enforceable and have a dispute resolution mechanism, but experts say China will not allow that, and ASEAN may end up acquiescing to what amounts to a gentlemen’s agreement.

Singapore’s foreign minister Vivian Balakrishnan said it was still premature to conclude the outcome of the negotiations for the code of conduct, which will be done by lawyers.

“One key issue is the question of legally binding,” he told reporters late on Sunday. “Surely when we move into the COC, it has got to have some additional or significant legal effect.”

Philippine Foreign Secretary Alan Peter Cayetano said he preferred a legally-binding agreement, which other countries, like Vietnam, supported.

Jay Batongbacal, an expert on the South China Sea at the University of the Philippines, told news channel ANC the adoption of the framework gave China “the absolute upper hand” in terms of strategy, because it will be able to decide when the negotiating process can start.

(JE) Como o Japão está a lidar com a nova legião de multimilionários

(JE) Com uma economia a gerar milhões de milionários em todo o mundo, a reinvenção dos serviços a favor das classes mais favorecidas economicamente tem sido uma das estratégias adotadas pelas empresas em todo o país.

Se excluirmos os Estados Unidos, o Japão é nos dias de hoje o país com mais milionários em todo o mundo, a fazer esquecer as sete recessões que se fizeram sentir em menos de duas décadas. Graças a esta legião de super-ricos no país, o mercado de produtos de luxo tem disparado e entre as empresas têm sido adotadas novas estratégias para responder a uma população, em que os termos idosos e ricos aparecem cada vez mais de mãos dadas.

“O Japão é um ótimo mercado de luxo”, afirma Greg Schulze, chefe executivo da agência de viagensonline Expedia à agência ‘Bloomberg’. No último ano, o Japão foi o único país em que o mercado de artigos de luxo cresceu, de acordo com a consultora norte-americana Bain & Company, numa altura em que os salários atingiram uma queda média de 10% face ao pico registado em 1997 e a divisão entre ricos e pobres se amplia cada vez mais.

Greg Schulze dá conta de que as reservas japoneses para bilhetes de avião em primeira classe cresceram duas vezes mais rápido do que os de classe económica. A JTB Corporation, a maior agência de viagens do país, afirma que o número de clientes que voam em primeira classe aumentou 10 vezes mais desde 2003.

O mesmo tem vindo acontecer com a indústria dos cruzeiros. O número de passageiros milionários japoneses aumentou 12% no ano passado para um recorde de 248 mil e a viagem mais cara (e luxuosa) da empresa de transportes náuticos Nippon Yusen KK, que dura três meses e meio e percorre o mundo, tem estado quase sempre esgotada. O bilhete pode chegar aos 230 mil dólares (cerca de 200 mil euros).

Para responder a esta classe endinheirada no Japão, o Hoshino Resort Corporation construiu recentemente seis grandes propriedades de luxo ao estilo japonês no meio da capital financeira de Tóquio. Para construir este oásis, na sombra dos prédios circundantes, a empresa teve de perfurar a superfície terrestre para abrir várias fontes termais e proporcionar um refúgio tranquilo para os seus hóspedes.

Também as empresas de autocarros e comboios estão a reinventar os seus negócios com versões de luxo. Se andar de autocarro ou comboio pode parecer algo pouco atrativo para os bolsos mais abastados, a verdade é que empresas como a Isetan Mitsukoshi Holdings e a JR Kyushu Railway criaram soluções mais cómodas e personalizadas para os seus clientes. Os transportes vêm decorados com flores, sofás e nas cabines estão incorporados bares e espétaculos de animação.

Com uma economia a gerar milhões de milionários em todo o mundo, a reinvenção dos serviços a favor das classes mais favorecidas economicamente tem sido uma das estratégias adotadas pelas empresas em todo o país. O Japão tem mais pessoas com ativos líquidos acima de 1 milhão de dólares (89 mil euros), mais do que a Alemanha e a China combinadas.

(Japan Times) Japan-EU trade pact continues to elude over auto, dairy tariffs

(Japan Times) After two days of high-level talks, a broad agreement on free trade envisioned by Japan and the European Union remained out of reach Saturday as differences lingered over tariffs on European dairy and farm products, and other sensitive issues.

“There has been significant progress but important issues that the two sides need to work on still remain,” Foreign Minister Fumio Kishida told reporters after meeting with EU Trade Commissioner Cecilia Malmstrom in Tokyo.

With Japanese and EU negotiators seeking to reach a broad agreement before their leaders meet this week, Kishida said he intends to visit Brussels for “final confirmation” in hopes of sealing the deal ahead of the meeting.

Agriculture, Forestry and Fisheries Minister Yuji Yamamoto, who joined the Kishida-Malmstrom talks along with EU Agriculture and Rural Development Commissioner Phil Hogan, echoed Kishida’s views.

EU demands regarding farm and dairy products are so tough that they are “not yet at the level Japan can accept,” Yamamoto told reporters after Saturday’s meetings, adding he may go to Brussels with Kishida to further advance negotiations.

Kishida said that when he and Yamamoto reported the results of the talks to Prime Minister Shinzo Abe, the prime minister told the pair to continue negotiating as hard as possible.

Japan and the 28-member bloc are trying to strike a broad free trade agreement before their leaders meet ahead of the Group of 20 summit of major economies in Germany on Friday. Together, they account for around 30 percent of the global economy. The free trade talks began in 2013.

Japan and the EU say striking a deal will send a strong message to countries that are leaning more toward protectionism and demonstrate the importance of free and fair trade.

Ahead of the start of the talks Friday, chief negotiators from the two sides had spent the past three weeks in Tokyo holding discussions.

“We have not yet reached an agreement. We are in deadlock,” Yamamoto told reporters after Saturday morning’s session with his EU counterparts.

Yamamoto and Hogan also held separate one-on-one talks to get a deeper understanding of their respective “political” stances, according to Yamamoto.

Later that afternoon, Minister of Economy, Trade and Industry Hiroshige Seko met with Malmstrom and urged the early elimination of the EU’s 10 percent tariff on Japanese automobiles, according to a Japanese official who attended the meeting.

Seko told the EU commissioner that Japan’s rivals in South Korea have a competitive edge in the European market thanks to a bilateral FTA that eliminated import duties on Korean automobiles.

Malmstrom said tariff cuts cannot easily be achieved because European automakers are the biggest source of jobs in the 28-member bloc, the Japanese official said.

“Intense negotiations ongoing this morning. Cars and agriculture the two big outstanding issues,” Malmstrom tweeted before the talks.

The EU is demanding the elimination of tariffs on cheese and more access to Japan’s market for wine, pork, chocolates and lumber.

Farmers in Japan are concerned a trade deal will trigger a flood of highly competitive farm products from Europe.

(ECO) No Nomura, o menu completo custa 120 mil euros

(ECO) No Nomura, há menus para todos os gostos. O mais caro custa 120 mil euros. Restaurante de sushi? Não, estamos a falar de notas de research e de análise de mercados.

Por 120 mil euros tem acesso ao menu completo do Nomura. Mas há menus para todas as carteiras. Não, não estamos a falar de um restaurante japonês de sushi. Falamos do banco de investimento nipónico que, com a proibição europeia em relação à cobrança de comissões por notas de research aos investidores, está a reorganizar a sua oferta de análise de mercados aos clientes.

Foi essa a quantia que aquele banco nipónico pediu em abril por uma “oferta premium” integrada: 120 mil euros por ano, de acordo com um documento de tabela de preços a que a Bloomberg teve acesso.

Embora o Nomura tenha dito que o preçário ainda não esteja definido e que está em negociações com os seus clientes, esta abordagem fornece pistas acerca da forma como os bancos e os seus clientes vão estabelecer um preço por um serviço em que raramente era exigido um pagamento.

O novo enquadramento legal MiFID II entra em vigor já a partir do dia 3 de janeiro, com o objetivo de acabar com conflitos de interesse porque vai exigir que os gestores de ativos separem as comissões de negociação dos encargos com research. Com estas mudanças, os bancos de investimento procuram agora um novo modelo de negócio para vender os seus serviços de análise de mercados a um preço que não afaste clientes, mas que não seja tão baixo ao ponto de o regulador os acusar de contornar as regras.

No menu do Nomura à disposição dos clientes encontram-se outras opções mais baratas: relatórios sobre o mercado cambial e assuntos económicos custam 60 mil euros. Notas de research sobre mercados emergentes ou um pacote de análise acerca do mercado de ativos de rendimento fixo e de crédito custa 80 mil euros.

À Bloomberg, um porta-voz do Nomura adiantou que os preços já mudaram entretanto, sem prestar mais comentários. De acordo com o site do Nomura, o banco dispõe de 300 analistas de research em todo o mundo.

(Economist) As crime dries up, Japan’s police hunt for things to do

(Economist) There was just one fatal shooting in the whole of 2015.

THE stake-out lasted a week, but it paid off in the end. The tireless police of Kagoshima, a sleepy city in the far south of the country, watched the unlocked car day and night. It was parked outside a supermarket, and contained a case of malt beer. Finally, a passing middle-aged man decided to help himself. Five policemen instantly pounced, nabbing one of the city’s few remaining law-breakers.

Japan’s cluttered streets are not always pretty but they are remarkably safe. Crime rates have been falling for 13 years. The murder rate of 0.3 per 100,000 people is among the lowest in the world; in America it is almost 4 (see chart). A single gun slaying was recorded for the whole of 2015. Even yakuza gangsters, once a potent criminal force, have been weakened by tougher laws and old age.

Yet, far from being pensioned off, the police are growing in numbers: beat cops, known colloquially as omawari-san (Mr Walk-around), are a fixture in most neighbourhoods. Japan has over 259,000 uniformed officers—15,000 more than a decade ago, when crime rates were far higher. The ratio of officers to population is very high, especially in Tokyo, home to the world’s biggest metropolitan police force—a quarter bigger than the one protecting New York.

This means plenty of attention for crimes that would be considered too petty to investigate elsewhere, such as the theft of a bicycle or the possession of a tiny amount of drugs. One woman describes how five officers crowded into her cramped apartment after she reported her knickers being swiped from a clothesline. A small army of detectives was assigned last year to apprehend a group of 22 people who had been growing marijuana for their personal use only and smoking it in deserted rural spots.

In fact, as the police run out of things to do, they are becoming more inventive about what constitutes a crime, says Kanako Takayama of Kyoto University. In one recent case, she says, they arrested a group of people who had shared the cost of renting a car, deeming the arrangement an illegal taxi. Some prefectures have begun prosecuting people who ride their bicycles through red lights.

In 2015 a man was arrested for scribbling Adolf Hitler moustaches onto posters of Shinzo Abe, the prime minister. Ms Takayama says detectives have started appearing without permission on university campuses, to monitor “troublesome” students. One reason why police are going after cyclists may be to make up for the steady fall in driving offences. (Both drivers and cyclists can avoid fines by signing up for remedial training at certified driving schools, which are often staffed by retired officers, notes Colin Jones of Doshisha University.) Fifteen years ago police in Hokkaido, in Japan’s sparsely populated north, conspired with yakuza gangsters to smuggle guns into the country so they could meet quotas for finding them.

The hunt for things to do may sometimes be beneficial. The number of reported cases of children being abused at home has almost doubled since 2010, despite the declining birth rate. That suggests the police are increasingly intervening in the domestic sphere, which they used to avoid.

Even critics of Japan’s justice system accept that it gets a lot right. Rates of recidivism are low and a great deal of effort is made to keep young offenders out of the prison system; police work with parents to keep young people on the straight and narrow. Adults are incarcerated at a far lower rate than in most rich countries: 45 per 100,000, compared with 146 in Britain and 666 in the United States.

Yet the police are oddly inefficient. Even though there are so many officers and so few crimes, they solve less than 30% of them. Confessions, often made under duress, form the basis of most criminal prosecutions. The courts dismissed the case of the beer thief in Kagoshima, despite all the work that went into it. Japan is almost crime-free not thanks to the police, says Yoshihiro Yasuda, a campaigning lawyer, but because people police themselves.

(Reuters) Pence reassures Japan of U.S. resolve on North Korea, to work with China

(Reuters) U.S. Vice President Mike Pence reassured Japan of American commitment to reining in North Korea’s nuclear and missile ambitions on Tuesday, after warning that U.S. strikes in Syria and Afghanistan showed the strength of its resolve.

Pence arrived in Tokyo from South Korea, where he assured leaders of an “iron-clad” alliance with the United States in the face of the reclusive North, which has conducted a series of missile and nuclear tests in defiance of U.N. sanctions.

“The era of strategic patience is over and while all options are on the table, President (Donald) Trump is determined to work closely with Japan, with South Korea, with all our allies in the region and with China to achieve a peaceable resolution and the denuclearization of the Korean peninsula,” Pence said in Tokyo before lunch with Prime Minister Shinzo Abe.

Pence and Abe agreed that they needed to persuade China to play a larger role in dealing with North Korea, a Japanese government spokesman said.

North Korea regularly threatens to destroy Japan, South Korea and the United States and it showed no let-up in its belligerence after a failed missile test on Sunday, a day after putting on a huge display of missiles at a parade in Pyongyang.

North Korea’s deputy representative to the United Nations, Kim In Ryong, accused the United States on Monday of creating “a situation where nuclear war could break out an any time” and said the North’s next nuclear test would take place “at a time and at a place where our headquarters deems necessary”.

North Korea’s Vice Foreign Minister Han Song-Ryol told the BBC that missiles would be tested on “a weekly, monthly and yearly basis”.

The North has warned of a nuclear strike against the United States if provoked. It has said it has developed a missile that can strike the mainland United States, but officials and experts believe it is some time away from mastering the necessary technology, including miniaturizing a nuclear warhead.

Pence said on Monday the world had seen Trump’s resolve in the past two weeks, with a U.S. missile attack on a Syrian airfield and the dropping of a powerful non-nuclear bomb on Islamic State fighters in Afghanistan.

The Trump administration has said military action remains an option for dealing with North Korea.

But, mindful that this would likely trigger massive retaliation and casualties in South Korea and Japan, U.S. officials say Trump’s main focus is on tougher economic sanctions.

U.S. officials say tougher sanctions could include an oil embargo, a global ban on North Korea’s airline, intercepting cargo ships and punishing Chinese banks doing business with Pyongyang. They also say greater Chinese cooperation is vital.

“DIPLOMACY FIRST CHOICE”

Susan Thornton, acting U.S. assistant secretary of state for East Asia, said Secretary of State Rex Tillerson and China’s top diplomat, State Councillor Yang Jiechi, agreed in a phone call on Sunday on the need for strict enforcement of U.N. resolutions.

Chinese Foreign Minister Wang Yi repeated China’s line that the crisis could only be resolved by diplomacy.

“I’ve seen that the United States has reiterated it is willing to use political and diplomatic means to resolve this, as this is their first choice,” he told reporters in Beijing.

“Of course I think that any country will feel that political diplomatic means are of course the first choice,” Wang said.

Pence’s economic discussions in Tokyo will be closely watched to see how hard a line Washington is prepared to take on trade. Trump campaigned on an “America first” platform, and has vowed to narrow big trade deficits with nations such as China and Japan.

However, Trump has also shown willingness to link trade to other issues, saying he would cut a better trade deal with China if it exerts influence on North Korea.

China banned imports of North Korean coal, its most important export, in February, and Chinese media have raised the possibility of restricting oil shipments to the North.

But North Korea used Chinese-made trucks to display missiles at the military parade on Saturday, according to photographs, underlining the difficulty in enforcing U.N. sanctions.

China and North Korea maintain “normal contacts, including normal business contacts”, said Chinese Foreign Ministry spokesman Lu Kang, when asked about the trucks.

“At the same time, as a permanent member of the U.N. Security Council, China strictly adheres to its international responsibilities, including those from Security Council resolutions,” Lu told a daily briefing.

Impoverished North Korea and the rich, democratic South are technically still at war because their 1950-1953 conflict ended in a truce, not a peace treaty. South Korea hosts 28,500 U.S. troops to counter the threat from the North.

Trump’s decision to launch a missile strike against Syria, a Russian ally, drop a giant bomb on Afghanistan and stick with Obama-era policies on Crimea mean Russian hopes of him befriending the Kremlin have been on the slide.

Russian state media, which hailed his election win, have made a U-turn. On Sunday, media said he was scarier than North Korean leader Kim Jong Un.

For a graphic on nuclear North Korea, click here

For a graphic on Carl Vinson strike group, click here