The Global Triad: US, EU And Japan

With the globalization of Economic, especially financial globalization, economy in each country is becoming interdependence, mutual influence, mutual promotion. As a whole economic system, it has a sharp rise on unprecedented dependence and economic and financial volatility and crisis undergo a sharp increase on conductivity and unprecedented dependence. Not a single nation-state and economic entity remains existence and development in closed-door policy of economic conditions independent. The overall dependence among the countries is impossible to balance on the other, the developed countries benefit more than the developing countries. US, EU, Japan as the world’s major economies, global economic development has an important role in the world economy. To a certain degree, the estimate of world economy is becoming the economic estimate of the three greatest economical entities of the US, EU and Japan(Harborne, 2009).

U.S.

America’s economy has a large and strong power in global economic growth, therefore, it plays a very important role in the global economic growth(Raa, 2000). And global economic prospects depending largely on the U.S. economy has become the consensus to the most. Contemporary international economic system as the number one economic power, the U.S. indeed has an advantage in many ways, making the U.S. economy’s driving force. The U.S., the biggest driver for a total of three: first, advanced technology; in today’s world America’s technological achievements help the U.S. to remain the advantage in economic strength and political hegemony on the world situation and international relations, and it has produced a huge and profound impact on the world development. Second, globalization and trade liberalization make an economic contribution of the U.S.; most of the participants in globalization which is dominated by the U.S., have brought great benefits, but no doubt that the U.S. is one of the winners benefit most. The U.S. gain enormous benefits from globalization, but also it also results more revenue for further globalization. Third, the U.S. financial hegemony. Since the mid-1970s, he U.S. dollar has become a no policy constraints, that can be free to issue currency notes. This is the beginning of dollar hegemony. Three wheels just like these three areas – like drive the U.S. economy forward, at the same time it also plays a great role in world economic development. The world’s economic growth driven largely depend on the U.S. economy, so the U.S. trade, capital, information depth of industry, size, will affect the world economy. According to statistics, U.S. economic growth in 1999 makes a contribution of 40% to world economic growth; from 1999 to 2000, the Asian countries except Japan, 20% of economic growth is dependent on the U.S. information technology exports.

EU

European Union, although both belong to the economically developed areas like the U.S., the market structure and industrial structure has the obvious differences and gaps compared with U.S, so the EU’ s influence in the world market will be significantly less than the U.S., but it also directly or indirectly affects the European economy ability to drive world economic growth(Heinemann, 2003). European Union has rapidly improved its economic power and enhanced international competitiveness through the European OECD, the European Community, European Free Trade Area, and other means. In particular, after the EU ‘s establishment, it has accelerated development of capital goods free movement of laborers among member countries, promoting the development of national economies. To Europe: both through regional economic integration, it can eliminate trade barriers and other obstacles among member countries, as well as it could result market capacity expansion and deepening of the market and has created favorable conditions to economic boom, in line with European countries and the European interest. It vigorously promoted the European economy political development, enhancing Europe’s international political and economic status too; to the whole world: EU has played an exemplary role the rest of the world economic integration, and enhanced the trend towards a multiple world economy, promoting the formation of a new pattern of world politics.

But in the long run, the EU’ s trade with non-member countries will likely increase as its economic strength to expand, the internal will take advantage of measures to regulate the distribution of benefits. It can be predicted, as the EU economic integration and political integration of the development, the EU will with play an increasing role in the economy and in international affairs continued strength of economy, and constantly to the establishment of a “big European Free Trade Area” forward.

Japan

As the world’s second largest economy, Japan’s economic growth put new energy for the global economy, and it is expected to lead all global economy continues to grow steadily(Mano, 2000). Meanwhile, Japan’s economic growth will put complex and far-reaching impacts on the imbalanced global economy , especially in other Asian countries and East Asia. Japan has strong domestic consumer demand, business investment continues to grow and imports increased significantly. Thus Japan’s economic growth has become another bright spot after the U.S. economy and strong economic growth in East Asian countries. Japan’s economic growth in other Asian countries will have a profound influence on the entire East Asian region. On the one hand, as Japan’s economic growth accelerated pace, Japan will further expand economic and trade cooperation and direct investment in East Asia, even more closely with the East Asia economic relations, thereby it accelerates process of economic integration cooperation of the currency in East Asia; on the other hand, Japanese companies will pay more attention to management, competitive strategy and technology research and development, and Japan’s manufacturing industry will be high-tech, high value-added quality products to impact the international market, and to continue to expand in East Asia’s exports, and thus make China, India and other countries faced with the rapid rise of strong competition in the manufacturing industry.

Japanese manufacturing ranks first in the world, compared with the U.S. and Germany, Japan’s industrial structure has the advantages and disadvantages of three characteristics: First, in the U.S. and Germany in competitive industries, some of the natural resource industries, but Japan has the international competitiveness of all manufacturing industries. Second, the competitive advantage of Japanese manufacturing embodied in machinery and to passenger cars based manufacturing, with a rate much higher than the U.S. and Germany. Third, most competitive industries is the production of intermediate goods industries in the U.S. and Germany, but Japan’s dominant industry, both production of intermediate goods industries, but also the production of final consumer goods industries.

Japan, as the world second largest economy entity, is also a major foreign direct investor, linking Japan and the world economy closer and closer. Its foreign direct investment is growing with the development of the world economy. In recent years, Japanese foreign direct investment surged after a sharp growth in foreign direct investment and showed a lot of new changes in the regional structure. Sector structure of foreign direct investment in Japan also reflects the comprehensive, multi-level overall pattern of foreign direct investment in the Web.

References

Harborne, P, Hendry, C 2009, ‘Pathways to commercial wind power in the US, Europe and Japan: The role of demonstration projects and field trials in the innovation process’, Energy Policy, Vol.37, no. 9, pp. 3580-3595.

Mano, Y, Otsuka, K 2000, ‘Agglomeration Economies and Geographical Concentration of Industries: A Case Study of Manufacturing Sectors in Postwar Japan’, Journal of the Japanese and International Economies, Vol. 14,no. 3, pp.189-203.

Heinemann, F 2003, ‘The political economy of EU enlargement and the Treaty of Nice’, European Journal of Political Economy, Vol.19, no.1, pp. 17-31.

Raa,T, Wolff, E, N 2000, ‘Engines of growth in the US economy’, Structural Change and Economic Dynamics, Vol.11,nn. 4, pp.473-489.