Three months have passed in the blink of an eye, and we have entered April this week. Cherry blossom blooming has been officially announced in various regions, and they are expected to reach full bloom soon.
By the way, there was an article about Miki castle in Miki city, Hyogo prefecture in the other day’s newspaper. When I was little, I used to live in Miki city for 2~3 years, because Miki city is my stepmother’s birthplace, and I remembered it very nostalgically. Now only the ruins of the castle remain, but in the 16th century, it was the residence of the Bessho family that had great power in Harima region. It seems that the castle was surrounded by cliffs and Mino River flowed on the north side, and it was strongly fortified. But in the era of Nagaharu Bessho, the load of the castle, he broke away from Nobunaga Oda and a battle with Hideyoshi Toyotomi broke out in 1578. After he withstood the starvation tactics for about two years, the castle fell.
And he committed suicide aged 23 on the condition of exchanging the lives of the soldiers left in the castle, suffering from hunger. There is a stone monument inscribed with his death poem “Now, there is no longer any resentment, if I believe that my life is meant to be a substitute for the lives of the castle soldiers”. It seems that even today, the local community holds “a spring festival of Bessho” every year on May 5 and thinks of the virtue of the deceased. The local industry of Miki city is hardware manufacturing, and the city is a major production area for “Yamada Nishiki”, a famous rice variety used in sake brewing and famous as a sake-producing region. On top of that, it is only about 30 km away from the famous Arima Hot Springs. How about paying a visit once?

■■Notice:
My humble manuscript is going to be published in both the morning and digital editions of the Nikkei newspaper on April 11, Friday. The column to be published is a section of “insights and insightful views” of “economics classroom” around page 30. I keep the details confidential until the publication date. I submitted it based on my usual theory, limited to about 1,000 characters, on February 7 this year, and my submission was accepted on February 10. And this time, I have received a notification about the publication date. If you have the opportunity, I would be most grateful if you could review it and share your thoughts.

■■What I have recently thought and focused on:
■Trump shock (tariff increase in the United States):
Trump administration published the details of reciprocal tariffs as previously announced on April 2 in local time (the same shall apply hereafter). According to them, the United States will impose “reciprocal tariffs” by increasing U.S. tariffs, based on the tariff rates and non-tariff barriers of trading partner countries, and impose a 24 % tariff on Japan activated at 12:01AM on April 9. And it also published that a uniform tariff rate of 10 % will be imposed on all countries and regions for which individual tariff rates are not specified activated on April 5.
By the way, the tariff does not impose additional duties on steel products and aluminum that are already subject to a 25 % tariff or all imported vehicles imposed on a 25 % tariff on April 3. In principle, vehicles that comply with the Agreement between the United States, Mexico, and Canada (USMCA) allowing for tariff-free exports and imports will have their tariff rates reduced according to the proportion of U.S.-made parts used. And a 25 % additional tariff will be imposed on automobile parts, including engines, by May 3.
The recent implementation of tariffs by Trump is expected to have significant repercussions, not only on the Japanese economy but also on the global economy. Incidentally, according to the trade statistics, Japan’s automobile exports to the United States in 2024 (about 1.3 million vehicle exports) exceed 6 trillion yen in value. When combined with about 1.23 trillion yen in automobile parts, these account for about one-third of exports to the United States (21.2 trillion yen in 2024). If the automobile tariff increases from the current 2.5 % to ten times that amount, reaching 25 %, the impact on Japan’s six major companies is estimated to reach a scale of 3.2 trillion yen.
I don’t intend to support Trump’s high-handed approach this time, but it seems to me that, until today, not only Japan but also many countries around the world have been overly dependent on the generosity or easygoing of the United States during a time of abundance in terms of economy and security. The consequences have caught up with us. For instance, the claim that Japan imposes a 700 % tariff on imported rice appears to be somewhat unclear in terms of its basis, but it is true that Japanese government has stubbornly maintained policies to protect rice due to domestic circumstances.  The rice shortage has become a growing concern in Japan, but now is the time to shift policy. This is not a story limited to rice. Japan should break away from its outdated systems, as change will not progress without external pressure.
■The operation of the National Assembly is a tightrope walk:
In a situation where the ruling party loses its majority in the House of Representatives, the current parliamentary session is spending time on partisan discussions that are disconnected from the severe international situation, but the 2025 budget proposal was enacted just in time before the fiscal year ended. As I see such situations, despite the fact that Prime Minister Ishiba secured the position of Prime Minister in his fifth attempt at the Liberal Democratic Party leadership election, I doubt whether he was truly “prepared and determined” to take on the role, due to “distribution of 100,000yen gift certificates” and frequent inconsistent comments. Thinking about such things, I am worried about whether Japan can overcome the impact of the recent Trump tariffs on its economy. However, are there current Japanese politicians who can demonstrate leadership in coping with national crisis and eliminate the public’s anxiety?
■Wage negotiations in 2025:
According to preliminary results of the Japanese Trade Union Confederation (RENGO), wage negotiations in 2024 resulted in an average increase of 5.46 %, reaching the highest level in 34 years. Regarding small and medium-sized enterprises, it has also exceeded the 5 % mark for the first time in 33 years. There is a severe labor shortage in the background. The labor share rate of large enterprises is said to be in the 30 % range, and there is still some financial leeway. But the labor share rate of small and medium-sized enterprises has reached the 70 % range, and there is no leeway. Small and medium-sized enterprises account for more than 99 % of the total number of enterprises in Japan and 70 % of total employment. In the future, it is essential to pass on the increase of costs such as raw material costs, logistics costs and labor costs to prices. Otherwise, business continuity becomes impossible. However, according to a survey published by Tokyo Shoko Research on February 26, in reality, more than 20 % companies responded that they “were unable to pass on costs”, and the result was tough, with about half of the companies reporting that they “were able to pass on costs, but the extent of the price pass-through remained below 5 %”.
■New guidelines for a Mount Fuji eruption and a Nankai Trough Mega-Quake:
Recently, government agencies have consecutively announced new guidelines. ①The impact of volcanic ash from a Mount Fuji eruption ②The possibility of a Nankai Trough Mega-Quake occurring within the next 30 years has been raised to about 80 %, and the maximum number of deaths will reach 298,000. I am concerned about how many people will perceive these guidelines as an “impending personal crisis” and take concrete action accordingly.
On the other hand, Japanese government has published that the business scale of “National Resilience Implementation Mid-Term Plan” to be implemented over five years starting from fiscal year 2026 will be the largest ever at “a scale of 20 trillion yen”. It is an increase of over 5 trillion yen from the current plan. It is incorporating repair measures for about 92,000 roads and bridges nationwide, strengthening the resilience of mobile phone base stations and so on. Repairing aging infrastructure is an urgent issue.