Years ago, Japan rose to economic prominence by taking apart US products like cars and TV sets to learn how to make them better.
Now, as Japan's focus on manufacturing wanes, economic planners here are trying to reverse-engineer another source of the US' economic strength: Wall Street.
Japan's Financial Services Agency, which oversees the nation's banking and securities industries, is working on a plan, to be presented before the end of the year, aimed at transforming Tokyo into a global financial capital more on par with New York and London. Top Japanese officials have toured Wall Street and the City, London's financial district, in search of the secrets of their vitality.
PHOTO: NY TIMES NEWS SERVICE
But so far, the initial drafts suggest that Japan's economic specialists are having trouble figuring out the secret of the Western financial centers' success.
The Japanese government is also seeking ways to maintain Tokyo as the financial capital of Asia and to keep ahead of rivals like Hong Kong, Singapore and even Mumbai. Officials hope that the plan will attract more foreign investors and help revive their country's stock markets, which have underperformed other major markets, even after the turmoil in subprime lending hurt US and European financial institutions.
The plan comes as Japan's US$4.5 trillion economy is on the rebound. In the most recent quarter, it grew at a solid annual pace of 2.6 percent.
But for many years, the Japanese, rather than investing more at home, have been putting their money overseas because of the low returns from domestic stocks and bonds. Some of that flow of money abroad appears to be slowing, a move reflected in a stronger Japanese yen. That gives resonance to the Japanese hopes of creating a financial district in Tokyo that can lure foreign investment and Western professionals.
But some of the proposals from the Financial Services Agency read more like excerpts from a real estate brochure than a manifesto for financial ascendance. There are proposals for building more spacious apartments, earthquake-resistant offices and plusher sports clubs.
One idea is to add restaurants that serve Western fare and stay open after midnight to accommodate the financial industry's grueling work hours.
The plan also calls for more English-speaking hospitals and schools, more English street signs and a faster train link to Narita, the main international airport.
Less evident are the kinds of changes that could draw foreign professionals and companies: lower taxes, a bigger English-speaking talent pool and greater transparency and restraint in market oversight by the agency itself.
"The agency's plan does not solve the core issues," said Naoko Nemoto, a banking analyst at Standard & Poor's in Japan.
Critics said the lack of more substantial measures reflected bureaucratic resistance by the Financial Services Agency, which fears losing its power. An even bigger hurdle, many say, is a deep-seated aversion in Japan to finance, which is regarded here as a dirty game.
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