Japan’s Business Community Wary of Suga Adviser

The Yomiuri Shimbun

13:00 JST, December 5, 2020

Views seen as unfavorable to small firms

David Atkinson, a member of Prime Minister Yoshihide Suga’s brain trust, has alarmed some in Japan’s business community and the ruling Liberal Democratic Party with his negative view of small and medium-size businesses.

Atkinson has been considered a virtual member of Suga’s staff since Suga’s time as chief cabinet secretary, and he personally advised Suga on the tourism strategy that the government eventually implemented.

The Briton, a member of the government’s Growth Strategy Council, has written that small businesses should become more productive or cease to exist — an idea that some think the prime minister tacitly approves.

“We will strengthen our support for small and midsize businesses to increase their foothold,” Suga said at a meeting of the Growth Strategy Council held at the Prime Minister’s Office on Tuesday, indicating a policy that aims to improve productivity at small and midsize companies through taxation and subsidy systems.

At a total of five meetings of the council, including Tuesday’s meeting, Atkinson argued that “the cause of low productivity in Japanese companies overall is low productivity in small and midsize companies when compared to large companies.”

Japan Chamber of Commerce and Industry Chairperson Akio Mimura countered by saying, “Low productivity is a challenge for Japan’s economy as a whole, which includes large companies.”

The two often clash at meetings.

Atkinson previously worked as an analyst and is currently the president of a company that restores works of art, including national treasures. He is well-versed in tourism strategy and often advised Suga when he was chief cabinet secretary. For example, he recommended the easing of visa requirements, which contributed to nearly quadrupling the number of foreign visitors to Japan over seven years.

Government sources have said that it was the prime minister’s idea to appoint him to his council position.

However, there are concerns within the LDP as Atkinson has written a book in which he advocated “reducing the number of small and midsize companies by half.”

“Small and midsize businesses support Japan’s economy. As such, it isn’t surprising that there is a backlash against the opinion that such businesses should be restructured because of low productivity,” a mid-ranking party member said.

The prime minister is looking to reorganize small and midsize enterprises, and intends to find a point of compromise while keeping an eye on how both the general public and the business community respond.