Japan is trying to look modern with new banknotes, but that image no longer holds true.

Tokyo man is first to withdraw new banknotes from ATM

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  • Anoma van der Veere

    Japan Correspondent

  • Anoma van der Veere

    Japan Correspondent

Japan began issuing new banknotes today. The Ministry of Finance and the Bank of Japan redesign banknotes every 20 years to prevent counterfeiting. This time, the choice of new faces is striking: the images are meant to symbolize Japan’s progress, but above all, they also reveal the country’s biggest problems.

The largest banknote, the 10,000 yen (57 euros), features a portrait of 19th-century businessman Eiichi Shibuzawa. He was involved in founding hundreds of companies, but is best known for creating Japan’s first bank and introducing paper money to the country. Partly because of these innovations, he is known as the father of modern Japanese capitalism.

However, the country seems to have lost this creative power. “Japan still has a very high-tech image, but unfortunately that is no longer true,” says political economist Saori Shibata.

Despite the government’s efforts to encourage the use of digital payment solutions, the Japanese people still rely on cash.

Six out of ten payment transactions are still made with physical money. In the Netherlands, only two out of ten purchases are made with cash. “You also see that a large part of the population is skeptical about the digitalization of payments, so they refuse to use it,” Shibata continues. “So there is little innovation.”

Investing in science and education

In an attempt to change course, Prime Minister Kishida introduced a sweeping economic reform last year called “New Capitalism.” Among other things, he promised to raise wages, support small and medium-sized businesses, and invest in science and education to restore Japan’s creative power.

Partly for this reason, the image chosen on the 1,000 yen (€6) banknote is of bacteriologist Shibasaburo Kitasato. Together with the German Emil von Behring, he developed the first cure for tetanus. He was one of the first Japanese to be active internationally in the exchange of knowledge, and thus a symbol of Japanese innovation in technology and science.

The National Printing Agency of Japan is proud to announce that the new banknotes are made using the latest anti-counterfeiting technologies, including 3D printing methods. Japan is the first country to use moving holograms on its banknotes.

Despite investments in science and a flashy display of new technologies, Japan appears to be lagging behind in scientific innovation. In 2004, the country ranked fourth in the world for the number of cited scientific publications, behind France, the United Kingdom and the United States. It has now dropped to thirteenth.

Women’s Empowerment

It’s not just academic rankings that are causing the country to lag behind: According to the World Economic Forum, Japan will slide from 116th to 125th in women’s empowerment among 145 countries to be measured in 2023. It’s a result of underrepresentation in senior positions in business, parliament and the cabinet.

Perhaps this is precisely why the decision was made to feature Umeko Tsuda, a pioneer in women’s education, on the 5,000 yen (€27) note. Tsuda was the first Japanese woman to study in America, and upon her return she founded one of the first universities for women. Today, she becomes only the second woman to grace a Japanese banknote since the introduction of paper money in 1885.

New Japanese banknotes, with Umeko Tsuda in the middle

“The government wants to show that it recognizes that women also play a role in Japanese history,” Shibata explains. “But it is not a sincere attempt to improve their situation. Because of the current government’s policies, there has been almost no progress in women’s emancipation.”

Japan’s female labor force participation rate is 73 percent, well above the global average of about 50 percent. At the same time, the wage gap has become much wider than in other countries, and women often end up working in low-paying, part-time jobs with no job security.

“The ruling party basically treats women as machines that increase productivity and alleviate labor shortages,” Shibata explains. “So having a woman on the banknote is a nice gesture, but it’s basically a symbolic policy.”

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