A 'network power shift' or up the value chain?: Japan's changing role in Asian political economy

Abstract

The goal of this article is to trace the evolution of Japan's role in Southeast and South Asian political economy in the 2000s-2010s to understand how Japan's previously established network power in Asian supply chains has changed amid much-discussed power shifts in the region. The increasing number of emerging and rising regional powers induces Japan to search for new approaches to support strong economic ties with the partners. Some of Japan's approaches may seek to reflect the needs of the country's partners, to maintain an image of a responsible stakeholder, while others include trade-offs regarding participation in emerging blocs and continuation of foreign economic policy based on national interests, as formulated by different domestic policy constituencies. The importance of network connections with Southeast Asia (SEA) and adjacent countries such as Bangladesh is determined by the region's sustained growth potential, Japan's continuing export-oriented economy and its attempts to stay relevant, while remaining a core node of regional value chains. Domestically, Japan's reliance on export-led development has implications for debates on neoliberal policies and state capitalism inside Japan proper. Internationally, we seek to elucidate how Japan keeps pursuing its national interests in regional economic policy, while maintaining its existing geopolitical alignments amid increasingly networked regional security. We examine Japan's policy initiatives and contextualise them within our analysis of trade and investment flows to clarify cooperation priorities and to identify shifts in Japan's network power in the region.