The COVID-19 pandemic has become the defining global health crisis of our time, with deep social and economic implications in the years to come. The Bank of Japan has warned that it could plunge the country into deep economic stagnation. According to a survey carried out by Teikoku Databank (TDB), more than 10,000 Japanese businesses projected that COVID-19 would have a “negative impact on their business performance.” As of April 8th, Japan has recorded 42 coronavirus-linked bankruptcies. The 2020 Tokyo Olympic and Paralympic Games, once expected to provide a spark for the already recessing Japanese economy, is facing a one-year postponement.
In response, on April 6th, the prime minister Shinzo Abe declared a month-long state of emergency in seven major population prefectures. The government also announced a two-phase economic package to protect its economy from fallout due to the coronavirus pandemic. The first phase is a stimulus package worth a record $989 billion (equal to 20% of Japan’s annual economic output) to stop job losses and bankruptcies. It includes tens of billions of dollars in cash handouts for families and small business owners who have lost their incomes because of the virus. The package also features tax breaks and zero-interest loans. Once the virus is contained, the second round of aid will include steps to increase consumer spending and tourism, and subsidies for regional economies.
Japan’s current response shows no indication of taking into account issues related to climate change mitigation and adaptation. It is understandable that the first phase of emergency aid should act as an immediate safety net for struggling companies and households. However, more long term plans of recovery should not be devised solely to ramp up the economy to pre-pandemic levels.
Instead, as Francesco La Camera, the IRENA Director-General states, these relief and aid packages are “at a scale to shape societies and economies for years to come”. They have the potential to accelerate the shift to a sustainable, decarbonized society. For example, the government could redirect fossil-fuel subsidies towards the development of renewable energy, creating employment, and boosting local income. As Faith Birol, the IEA executive director states, “A well-designed stimulus package could offer economic benefits and facilitate the turnover of energy capital, which will have huge benefits for the clean energy transition.”
To date, Japan’s planned relief packages lack any mention of such measures. Furthermore, just before the announcement of the relief packages, the Japanese government reaffirmed its Nationally Determined Contribution (NDC) on March 30th. Under the 2015 Paris Agreement decision texts, countries were expected to submit updated NDCs with higher emission reduction targets and publish long-term decarbonization strategies by 2020. Despite this, Japan left unchanged its original reduction target in 2015 of 26% compared to 2013.
Japan’s NDC has been criticized as inadequate and lacking ambition by climate researchers and experts. Naoyuki Yamagishi, head of the climate and energy group at World Wildlife Fund Japan, said the country had “sent a completely wrong signal to the international society implying it is OK not to enhance ambition at this crucial moment.”
Another concern is Japan’s plans for long term decarbonization. In its recently updated NDC submission, Japan reiterated its intention to rely on innovations like artificial photosynthesis, other CCUS technologies, and hydrogen as a source of energy to eventually achieve a decarbonized society. Most of these are relatively underdeveloped technologies that require much more investment to be implemented on a wide scale. With so much of the country’s budget dedicated to economic relief, it is unlikely that Japan will be able to dedicate sufficient resources and attention at the required scale.
Activity Rating: ***Negative
The COVID-19 pandemic has disrupted the already slow-moving climate change efforts in Japan.
Public attention has been diverted to health and finance-related fears while the government has submitted an unimproved NDC. The relief and recovery packages the government is planning appear to be focused primarily on stimulating the economy and could cause carbon emissions to soar.
Action Alert Message:
Dear Minister of Environment Shinjiro Koizumi,
As you begin devising the second round of economic recovery packages and a long term recovery route, we urge you to consider the impacts on our transition to a more sustainable and resilient community. We encourage you to monitor the impact of the virus on the clean energy market and develop policies that can boost the economy without sacrificing the environment.
Minister of Environment Shinjiro Koizumi
Address: No. 5 Godochosha, 1-2-2 Kasumigaseki, Chiyoda-ku, Tokyo 100-8975,
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This Post was submitted by Climate Scorecard Japan Country Manager Yukiko Nukia and Yun Tzu (Allison) Lin
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