Mr Major’s Speech in Tokyo – 20 September 1993

Below is the text of Mr Major’s speech made in Tokyo to the Nikkeiren Economic Organisation on Monday 20th September 1993.

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PRIME MINISTER:

It is a very honour to speak today to this distinguished audience and a very great pleasure to be back in Tokyo. I was last here only ten weeks ago for the Group of Seven Summit and I am delighted to have the opportunity of returning so soon.

A western traveller many years ago in 1876 arriving in Japan was impressed. It was, he said: “Like mental oxygen to look upon and breathe in a unique civilisation like that of Japan.”

“Mental oxygen” is a good phrase; it suggests a new way of seeing things, a new way of doing things. What was true at the start of the Meiji era is true at the start of the Heisei era. Every European who visits Japan sees the world and his place in it in a different light.

We approach challenges in a different way. British mountaineers were the first to conquer the Eiger in Switzerland navigating a complex ascent along ridges and up gulleys. Japanese mountaineers were the first to climb the Eiger vertically; it took years of preparation; the ascent took exceptional teamwork and exceptional patience; nobody had ever thought of that approach before.

Similarly daunting challenges are facing Japan and Britain today. We will go about tackling them in different ways but we will both be determined to tackle them head on.

Perhaps the foremost challenge in Japan today is political. I have the greatest respect for Prime Minister Hosokawa and what he and his government have set out to achieve. Like any elected politician, he believes fervently in parliamentary democracy. I welcome any effort to keep politics in direct touch with the wishes of the electorate; it is an aspect in government which some in Europe in the last few years have sometimes underestimated.

But today I want to talk about the purpose of my visit to Japan. I want to seize the opportunity to inject new energy into Britain and Japan’s partnership; I want to extend it into new areas and I want it to become a true strategic partnership.

Already we are in close in touch about the great international issues. We are both strong supporters of the Middle East peace process; Britain and Japan are both ready to help follow-up in the historic accord between the PLO and Israel; we have worked together as part of the successful United Nations operation in Cambodia and tackled together the threats to our, planet’s environment.

I warmly welcome Japan’s growing involvement in the maintenance of international peace and security. The world needs not only your financial contributions but also your peacekeepers and a confident political voice. I know there is keen interest in Japan in the United Nations Security Council. The effectiveness of the Council must be paramount but if there were to be consensus on enlargement I have no doubt that Japan, by virtue of its global interests, its contribution to international security and its contribution to United Nations peacekeeping, could undertake the full range of responsibilities of a permanent member and should certainly benefit.

One of your great reformers last century wrote:

“When I was twenty I knew that men were linked together in one province. When I was thirty I knew that men were linked together in one nation. When I was forty I knew that men were linked together in one world of five continents.”

That encapsulates well, I believe, the spirit that we need today.

We need the closest possible contact between our two peoples. Two great cultural festivals – UK90 in Japan and the remarkably successful Japan Festival 1991 in Britain – have brought our two peoples together. Sumo and karaoke are now as well known in London as Gary Lineker is in Tokyo but I want to do a good deal more.

I am therefore delighted to announce that a new scholarship programme called “The UK-Japan New Century Scholarship” is being set up for your best students at Oxford, our great university. Mr. Hosokawa and I will announce a high-level conference in London in January on Japan-British relations. Tomorrow, I will meet some of the British and Japanese scientists who are already working together and next week the British Minister for Science will visit Japan to look at the scope for deepening that important scientific cooperation.

On this visit to Japan I have brought with me twelve of our most senior businessmen whose companies without exception are all taking a strategic approach to this market. We now sell more here than to any country outside Europe and North America. British direct investment in Japan now approaches 3 billion dollars, half of it made in the last two years. That is good but we aim to do much better. Japanese companies – your companies – have invested heavily in Britain. In doing so, you have changed the way we work. The Nissan plant in Sunderland is now their most efficient in the world. Our car components industry has performed so well Toyota has brought forward its target date to achieve 80 per cent local content by six months.

We work hard in the market and we welcome you into ours. That is not always a popular policy. We need your cooperation if we are to show critics that this positive, open policy is, as I profoundly believe it to be, the right policy.

I am therefore delighted by the emphasis which Mr. Hosokawa is putting on deregulation and on structural reform. I hope that his government will also move decisively to stimulate domestic demand; that would help trade and help living standards and I think it would bring benefits to the peoples of both countries.

I hope you will also be able to take other measures to open your markets. You surely have no need now for tax discrimination against imported spirits; it cannot be in your best interests to maintain lingering barriers in other sectors, including financial services. British companies should have every opportunity to compete on equal terms for large contracts in sectors like aerospace. The Keidenren has issued some very welcome guidelines on open purchasing and I am sure more Japanese companies will apply them internationally and I welcome that unreservedly.

For over a decade, the British Government has pioneered deregulation and open economic policies. My predecessor, Margaret Thatcher, began to reshape the British economy by revitalising old and sleepy public monopolies and opening them up to competition. Sixty per cent of what were in 1979 public corporations are now privately owned; they employ almost one million people. During the Eighties, we were the world’s second-largest overseas investor; many of those investments come from those giant British companies freed from the shackles of nationalisation.

European economies like your own have been going through turbulent times; currency crisis and recession have hit us all. But Britain is among the first to find its way out of the gloom, Inflation is staying low, well below the European average and we intend to keep it that way. Our economy is growing again and GDP is forecast to continue on an upward path. Industrial production is up. GDP and retail sales are up, productivity is up, very sharply up indeed. Unemployment is still too high but has come down this year. The tough decisions that we took are now paying off and recovery is proceeding across a broad front.

Other European economies will follow; there is light ahead at the end of this recessionary tunnel but this must not, I believe, be the blinding light of excess ambition. The countries of the European Community must learn from their mistakes and not forget their mistakes. The fault lines in the Exchange Rate Mechanism produced a salutary shock. Of course we should seek ways of promoting economic convergence and greater currency stability in Europe and beyond but we should not believe that the creation of institutions or the declaration of grand intentions will produce miracles. The Community must proceed at a pace which carries the support of Europe’s 370 million people. We must welcome new members to the Community when they are ready to join it. We must take account of the national identity, old cultures and proudly-held traditions of all of Europe’s members. We must build on our strengths trade, the rule of law, democracy – recognising that the Community is the best instrument we have for securing the peace and the prosperity of Europe.

The European Community should do well what it can do. We strongly supported the creation of the Single Market. We insisted that it be an outward-looking creation. We must make sure it works from Sicily to Scotland. We insisted that cars produced in Japanese-owned factories in Britain enjoy the same access to the market as any other European cars.

Mr. Chairman, the European Community must also help negotiate a global agreement on trade – the Uruguay Round of GATT, European Ministers meet later today in Brussels to coordinate their position but it is the Commission of the EC – in the person of Sir Leon Brittan – which negotiates on our behalf. We have full confidence in the Commission in this important task and we believe they should be left free to get on and negotiate a settlement.

An agreement would inject a powerful stimulus into the world economy as markets enlarge and opportunities to trade at lower prices open up. That means growth in our economies, it means growth in jobs. It is hard to make precise calculations of the effects but respectable estimates put the extra income generated in the hundreds of billions of dollars. That growth will happen without the inflationary pressures which come with just about any other form of stimulus; there will be millions of new jobs.

There are of course still seductive voices urging us in the wrong direction, preaching trade regional blocs. The GATT deal is too difficult, they suggest; it runs against the interests of our citizens, they suggest; our citizens need increased protection, not increased exposure, they say; our cultures, our social traditions are at stake, they say.

I must say to this luncheon today that those voices are wrong and those voices are dangerous. Protectionism provokes retaliation and escalation; it leads to trade disputes and politicises economic relations; it acts as a hidden tax, raising prices and with them wage pressures; it handicaps efficient producers by raising their costs.

Peter Sutherland, the GATT Director-General, wants a deal in December. So does Britain. So, I hope and believe, does every one in this room today and I hope that feeling is extended right across the five continents.

Britain’s partnership with Japan is a key relationship; it works well and it will continue to do so. Japan also lies at the heart of our strategy towards the most dynamic region in the world. Japan has shown the way, through its enterprise and the industry of its people, to a new regional prosperity. Asia as a whole is enjoying spectacular economic growth, old controls are being abandoned, market based freedoms introduced.

This growth is being translated into new and burgeoning markets, into flourishing two-way trade and investment, into a new weight for Asia in world markets for capital and equity. Economic and social development are leading in turn to greater diversity in people’s lives, to increased choice, to more open and more democratic societies.

Political voice comes from economic choice. From South Korea to Thailand, people are gaining more say in their own government. The trend is unstoppable, as it has been elsewhere in the world; it is natural, it is right and it will underpin stability; stability founded on the rule of law – civil law as much as criminal law. In a democratic society, no-one can be above the law.

All this adds up to a substantial shift in the balance of global forces. Asia is acquiring a greater capacity, a greater will to shape the issues on the world political and economic agenda. Asian countries are increasingly involved in United Nations peacekeeping not only in Cambodia but also further afield. Asian governments increasingly discuss among themselves and with their partners the sources of potential instability in the region as well as its potential for nuclear and conventional proliferation. New regional frameworks for economic and security dialogue have been born.

We in Britain acknowledge the importance of these perspectives and developments. Britain has long been present and active in Asia. The first Englishman arrived in Japan nearly 400 years ago, took a Japanese wife and was in part responsible for the creation of the Japanese navy; other British citizens were already trading and exporting nearly everywhere else in Asia.

Today, we have a wealth of traditional connections with Asian countries, ties of sentiment, language, cultures and blood. History has, for example, given Britain a special responsibility for Hong Kong. Our aim is to ensure that Hong Kong’s success will continue into the new century founded on the concept of “one country, two systems” and underpinned by representative government and the rule of law. I know it is well understood here in Japan how important a role Hong Kong has to play in the region’s future prosperity.

History is therefore what you make of it. I am proud of all we have built on our forefathers’ fascination with Asia; the legacy goes well beyond commercial success. There is the excellence of Asian students at British universities; the curiosity of our young people – nearly 700 are here for example on the Japan English Teachers Scheme; the impact which the BBC World Service Television has made in Asia and I am pleased that it is coming to Japan next April.

We are today determined to give Asia a new place in our national priorities; we plan to deepen our involvement and our presence in Asia.

First, we seek a closer political dialogue with Asian governments. I have spoken of the breadth and excellence of our exchanges with Japan. We also welcome moves to establish new regional frameworks for economic and security dialogue; we are ready to contribute to that dialogue in any way which would be helpful.

Second, we are seeking a still stronger commercial presence. Already in the Asia Pacific region Britain is the largest European investor, the largest European exporter of invisibles, the second-largest European exporter of goods. We shall do even better in future.

Finally, we are seeking, Mr. Chairman, fuller cooperation with Asian countries as they join us in tackling regional and global problems. We believe that our membership of the key international organisations, our military expertise and our experience of conflict resolution well qualify us to help. Your Ambassador in London was kind enough to publish an article praising our diplomatic skills – perhaps partly as evidence of his own diplomatic skill in observing that in his host country! But we do believe that we can help Asia as Asia helps the rest of the world.

But there is no doubt that the problems of this small world increasingly affect us all in Asia and in Europe. Who, I wonder, one hundred years ago here in Tokyo would have thought how important peace in the Middle East would be to Japanese business? Common problems demand common responses: British people and Japanese people together in the United operation in Cambodia, together in car factories in Britain, together in finance houses in the City of London and together in aid projects in Africa.

Not unnaturally, we can come at the same problem from different angles. Europeans and Asians have always done that but I think as we do so, we produce better solutions for it. If you look at an object with one eye, you can see it clearly but with no sense of perspective; only with two eyes can the real shape of things be understood. I believe that together we can combine the best of two worlds and start the twenty-first century in good shape and in increasing friendship and it is therefore, Mr. Chairman, with that in mind that I would also, if I may, invite this distinguished audience to join me in a toast; it is a simple toast but a heartfelt toast and I hope you will feel able to join it. The toast, Mr. Chairman, is simply this:

Good relations between the United Kingdom and Japan; may they remain good and improve! Relations between the United Kingdom and Japan [Applause].