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Re-examining "Japan incorporated" : Japanese coal procurement and western Canadian coal

University of British Columbia

In the current situation of oversupply in world coal markets, Japanese coal buyers are accused in some quarters of having deliberately over-stimulated the supply by offering loans and extending long-term contracts to more coal mine operations than has been warranted by market conditions. Contained in the accusation is the charge that the Japanese government and steel industry have collaborated to set the conditions for oversupply. The thesis finds at the root of this assumption remnants of the "Japan Incorporated" stereotype. Examining the case of the steel industry, the study demonstrates the inaccuracy of the elitist model of Japan from which the stereotype derives. The purchase of thermal coal by Japanese interests is discussed to introduce further evidence of the diversity of interests which participate in policy decisions in Japan. An examination of the steel industry's approaches to acquiring coal reveals that a major concern of the industry has been to find ways to assure that it will have reliable supplies of reasonably-priced material. The industry's actions are best understood as ad hoc arrangements which have developed in response to domestic and international market conditions. To achieve its goals, the industry has pursued a strategy of diversification of supplier. The case of Western Canadian coal is presented to illustrate some of the main features of the implementation of the strategy. To enhance the security of their coal contracts, Japanese buyers increasingly have chosen to invest directly in the coal mine.

Text

2010-05-25

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http://hdl.handle.net/2429/25004

Political Science

University of British Columbia

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