Japan. James Rebischung

the production of automobiles, bicycles, radios, synthetic fibers, television sets, and time pieces. The almost 2,000 pharmaceutical companies in Japan produced over $3 billion worth of medicines in 1970, making the industry the second largest in the world. The Japanese life insurance business is also now the second largest of its kind in the world. It is a mammoth industry with over $17 billion in assets and over $250 billion in force.

      The development of Japan’s steel industry over the past twenty years is the best illustration of the nation’s unprecedented economic growth. As early as 1953, Japan surpassed its previous wartime record of steel production by turning out 7.6 million tons of crude steel. Due to continual investment in new and highly efficient production processes and facilities, an investment totalling nearly $14 billion by 1970, production reached 10 million tons in 1956, 20 million tons in 1960, 30 million tons in 1963, 82 million tons in 1969, and 92 million tons in 1970. From 1960 to 1970 steel production increased 460 percent and Japan became the third largest producer of steel in the world. Due to the recession in the home market, 1971 production dropped to 88.5 million tons, but rose to 96 million tons for 1972. Russia is first in the production of steel with over 120 million annual tons, while America is second with 112 million tons. West Germany is a distant fourth with 40 million tons. Together, Britain, France, China, and Italy do not equal the Japanese production. Japan now has nine of the ten largest furnaces in the world, and a production capacity of 115 million tons. Because modern, automated steel plants on seaside locations making full use of cheap ocean transportation are a feature of the Japanese steel industry, its facilities are 25 percent more efficient than American steel facilities, and it can produce steel at a labor cost of only $21 a ton, a third of the American cost and one-half that of West Germany.

      Though the great bulk of this low-priced Japanese steel is used by the rest of Japanese industry, especially by the ship-builders and auto manufacturers, giving them a competitive edge in world markets, much steel is exported. In 1970, the Japanese steel industry sold 16 million tons worth $3 billion in the world markets, accounting for 15 percent of Japanese exports. In 1971, steel exports jumped to almost 24 million tons worth $3.6 billion. Nippon Steel Corporation, a merger of Yawata Iron & Steel and Fuji Iron & Steel, is now the world’s largest individual steel producer. In 1970, the company led all Japanese companies in total sales with $3.6 billion.

      The Japanese shipbuilding industry has been the most able to profit from the low-cost production of Japanese steel. Other nations cannot compete with the Japanese builders because they have to pay about 25 percent more for their steel. In addition to higher material costs, foreign shipbuilders’ labor is not so highly trained as the Japanese and is less efficient. The turn-over rate of ships in the Japanese yards is almost twice that of their competitors. In the matter of over-size tankers no one can match the Japanese production facilities and costs. During the last fifteen years, the Japanese shipbuilding industry has grown to a global, monopolistic business, and in 1970 its foreign currency earnings were over $1.4 billion. Despite the revaluation of the yen in 1971, which caught the shipbuilders with about $6 billion of receivables in dollar-based contracts, and caused them to lose much money, the demand for ships is so strong that the shipbuilders are in a seller’s market and look to a very profitable future. Their backlog of orders extends into 1975.

      Ishikawajima-Harima Heavy Industries Company, Ltd., whose origins go back to 1853 when it was the first privately created shipbuilding company in Japan, is now a mammoth organization in shipbuilding as well as other fields. At Kure it is building the world’s largest tanker, a $33 million, 470,000 dead-weight-ton engineering marvel. The company is constructing a new shipyard which will be capable of turning out five 250,000 dead-weight-ton tankers each year. Another company, the Nippon Kokan K. K., is not only the second largest steel producer in Japan, and fifth in the world, with a production of over 12 million metric tons of crude steel, but it also operates three large shipyards. In addition to operating the world’s largest blast furnace at its Fukuyama steel works which produces 10,000 metric tons daily, the company produces all types of steel products and by-products such as chemical fertilizers, and can construct ships of from 20,000 tons to 270,000 tons. The company’s new Tsu Shipyard has an annual construction capacity of six 250,000 dwt class vessels, and has a building dock capacity for ships of 500,000 dwt.

      Because it is so efficient in the production of ships, Japan now owns more of them than any other nation and has the world’s largest marine fleet, some 30 million gross tons, accounting for 12 percent of the world’s total. Also, about half of Japan’s ships are only five years old. Nippon Yusen K. K., the “N.Y.K.” Line, is the world’s largest shipping firm in tonnage owned.