CONCLUSIONS
During the visit to the factories in Japan we felt that we were in an atmos- phere more closely proximating the industrial feeling in the United Kingdom than in either Taiwan or Hong Kong-the feeling that the trade unions and the industrialists were meeting in an atmosphere and condition conducive to reasonable discussions and negotiations and in a manner similar to that which we experience in this country.
The complete absence of incentive payment was a surprise and also because of this we felt that the rate of productivity in Japan was much below that which we anticipated before visiting this country. Having regard to the current attitude in respect of incentive payment schemes and the fact that at the present time Japan, due to its very rapid increase in the gross national product, allied to the activity of Zensen Domei, has been able to achieve an annual wage increase of 15% against living costs increases of about 6%, the considerable gap that existed between costs of Japanese goods and ours 10 years ago has narrowed considerably and, therefore, in the future Japan may not be as strong a competitor in the world markets such as we have experienced in the past.
The attitude we encountered in Japan, which we accept is after a very cursory visit, has a fairly strong trade union movement and still comparatively old methods, was somewhat surprising but this may very well be a reflection of the idiology which promotes Zensen Domei to obtain for each person a living wage and that wage to be increased by age and experience and very rarely does the production effort of a job enter into the establishment of wages as a direct negotiating factor.
The present position of the Yen in the world currency can, of course, unless it is revalued, become something of an embarrassment to the Japanese since in the Far East Japan is looked upon as being the most progressive nation with the highest standard of living and the highest degree of education amongst the population. It may very well be that in the near future the Japanese economy will feel a severe draught from the free trading of Red China and other South Eastern Asian countries, through Hong Kong and the establishment in Taiwan of both textiles and other industries.
The timing of our visit to the Far East was most appropriate since during the time we spent in these countries and in Japan in particular, there was considerable activity at the American State Department and Foreign Office of the Japanese Government in respect of a plan for the marketing of textile goods. During the time we were in Tokyo the American State Department had a delegation visiting Japan to discuss a voluntary control of imports of textiles into the U.S.A. and it was quite obvious from the atmosphere prevalent that if Japan came to any agreement, either voluntary or legally with the U.S.A., a similar agreement would be followed by the other Asian countries. The delega- tion considers that there will be, within the foreseeable future, an agreement reached between Japan and the U.S.A. on the voluntary control and exchange of goods with particular reference to clothing and textiles goods which would include Hosiery and Knitwear.
In such discussions the U.S.A. has a very strong bargaining factor in that Japan are anxious to have the return of Okinawa. At the present time this is
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