Regional Economic Development and Policy: a view from Kyushu, Japan

Yoshihiro MIYAMACHI (Mia)Associate-Vice-President, Professor of Economic Geography

University of Oita, JAPAN Email: ymiya@oita-u.ac.jp

Open Days – European week of cities and regions

Regional economic development from a comparative perspective - views from outside the EU

Tuesday 5th October, 20101

Outline

• Introduction: Where’s Kyushu?

• Economic trends and their spatial impacts in Kyushu

• Regional Policy debates

• Contrast with the EU spatial policy

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Introduction: Kyushu

• One of 7 regions in Japan

• Consists of 7 Prefectures

• Population: 13.3 million

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Continued• 10% economy of Japan, 1% of the world

– Equivalent to Belgium

• A gateway to East Asia

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Continued• The biggest city:

Fukuoka (2.7 million people including suburbs)

• Oita (0.6 million people)

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Seaside town

C.B.D.

Continued

• Major food production region in Japan

• Electronics and Automobile mfg

• A thriving tourism industry in hot springs localities

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Economic trends: GDP change in Japan 1956-2008

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Post-war economic phase

• 1945-55 War recovery

• 1956-65 High economic growth I

• 1966-75 High economic growth II

• 1976-85 Medium economic growth

• 1986-97 Roller coaster (bubble)

• 1998-present Low economic growth– Today’s focus: after 1986

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Bubble economy period

• The Plaza Agreement in 1985 led to the asset price bubble

• Collapsed in 1992

• Growth of FDI in mfg

• Tertiary sector shift

• Manual labor shortage in the heavily industrialized area

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Sectoral and spatial impact in Kyushu

• Restructuring in export-oriented mfg

• “Mother factory” strategy– Intend to keep a leading position in

technological guidance for overseas factories.

• Stronger links with Asian operation

• Expansion in automobile mfg

• Growth in tourism sector: Theme parks

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Low economic growth period

• Currency crisis in Asia in 1997

• Decline in land price

• Restructuring in the financial sector

• Deregulation under the neo liberal LDP

• Further financial deficit

• Development in ICT and knowledge-based sector

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Sectoral and spatial impact in Kyushu

• Collapse of theme park bubble

• Development in consumer services– Nursing and medical sector

• Development of new industry– Environment-conscious sector – Animation and computer game

• Retail decline in small and medium cities

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Regional policy debates: 1985-97

• Techno-polis projects– Five areas in Kyushu was selected– Kumamoto became a leading area in semi-

conductor mfg.

• Resort development projects

• Non-mfg sector development policy– R&D park projects– “Office arcadia” projects

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Continued

• Regional policies were designed by the central government

• Competition between local governments in obtaining the central government approval and subsidiaries

• Campaigns to attract mfg-related companies to own district.

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Regional policy debates:

1998-present• Eco-town projects

– Three areas in Kyushu were selected.– Kitakyushu is known as the most

advanced case in resource recycling business.

– Minamata, a pollution-plagued city, targets community-based recycling activities.

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Continued

• Knowledge cluster projects– Set up a regional system for technological

innovation.– Organized by local initiative around

universities, other public research institutions and private companies.

– Two areas in Kyushu were selected.– Super LSI cluster in Fukuoka and

Environmental business cluster in Kitakyushu16

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Continued

• A leading role in making regional policies has been progressively shifting from the central government to the local governments which enables better use of region-specific resources.

• Policy’s target is shifting from attracting business relocation to establishing networks of local actors.

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Contrast with EU spatial policy

• Japanese policy is mfg-oriented.

• Region became more important, but still the central government rules most of policies.

• International exchange between regions in Asia is not developed compared to that in Europe.

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