Japanese candidates wooing voters ahead of Sunday's election are offering plenty of prescriptions for curbing debt and engineering growth, but are singularly silent on a critical topic that is too hot to touch: immigration. But experts say that with a population forecast to shrink 30 percent by 2055 - a slide that would cap economic growth, slow fiscal reform and crush the social security system - Japan needs to look seriously at the option of opening up to immigrants. But they appear unlikely to broach the topic any time soon. “In any country, immigration is an unpopular issue that has the potential to overthrow an incumbent government. It is natural that no one has made it a point of contention,” said Hidenori Sakanaka, former chief of the Tokyo Regional Immigration Bureau. “But it makes little sense to talk about growth while paying no heed to an annual population loss of 500,000 or more. We are headed towards the collapse of the pension and public medical insurance systems,” said Sakanaka, who now heads a think tank. Even more worrying than the steep decline in the overall population is the growing proportion of the elderly. The number of people aged 65 or older is expected to grow 42 percent in the 50-year period, while those aged 15 to 64 will likely fall 46 percent, forcing each working-age Japanese to carry a far heavier social security burden. The government has started taking measures, such as a child care allowance, to boost the birth rate, but it is unclear how effective the steps will be. Even if they prompt couples to have more babies, there would a long gap before they become productive members of the society. The birth rate, measured by the number of children a woman is expected to have in her lifetime, has stood at about 1.3 in recent years, below the 2.1 needed to keep the population stable. “Even if people start having more babies all of a sudden, we have to wait until 2030 for them to join the labor market. Put bluntly, they will be a liability to society until then,” said Atsushi Okamura, a consultant at the Nomura Research Institute. “We need to think hard about how we will survive the next 20 years. It is past time that we start discussing the whole issue, including immigration.” Thorny issues Immigration can be a highly sensitive political subject in a country once so wary of foreigners that it closed itself to the outside world for over 200 years until the late 19th century. Only about 1.7 percent of Japan's population is foreign and a sluggish economy drove many home last year, when the number of registered foreigners fell for the first time in 48 years. Chinese make up the largest group of 2.19 million foreign residents, followed by ethnic Koreans, many of whom are descendants of people forced to come to Japan before its colonial rule over the Korean peninsula ended in 1945. Many Japanese worry that a rise would lead to increased crime and friction in a society long proud of its homogeneity. A group of Democratic Party politicians, then in opposition, proposed in 2003 allowing in 10 million immigrants. They included Motohisa Furukawa, now deputy chief cabinet secretary. Five years later, a similar proposal was made by lawmakers from the Liberal Democratic Party, in power at the time. Debate, however, never really took off. Underlining Japan's cautious stance towards foreigners, several political parties, including the LDP, oppose granting voting rights to permanent foreign residents in local elections. The Democrats, who took power last year but look unlikely to win a decisive victory in Sunday's upper house poll, have advocated giving voting rights to such foreigners. But its latest campaign manifesto makes no mention of the issue. Opening the doors to more immigrants would require sorting out thorny issues such as who should pay for language education and other assimilation costs, and how to guard against friction between newcomers and local residents. Nomura's Okamura said companies should shoulder part of the costs, possibly through a special tax, as beneficiaries of an increased and probably cheaper labor force. Nippon Keidanren, Japan's biggest business lobby, disagrees. “Companies in Japan are paying the world's highest corporate tax. We are already doing enough to cover such expenses,” said Akira Kawaguchi, co-director of Nippon Keidanren's industrial policy bureau. Okamura and Kawaguchi, however, agree that Kan's government cannot afford to leave the subject unattended if it wants to stop the once-mighty economic power from slipping into oblivion. “Global competition to attract talent is getting fiercer. If we don't have an inflow of people, we will create less innovation. And that in turn would make it even harder to attract people,” Kawaguchi said. “This vicious circle has to be avoided.”
