Who would have expected a nascent revival in an economy that's been sluggish for the past decade? A series of timely events have commingled into a propitious mix for the Japanese economy. Already, there are sure economic indicators promising a growing opportunity. There are burgeoning but relatively untapped sectors of the Japanese market which offer many exciting inroads. There is still time to ride the Japanese wave. It's growing big and fast on the arc of the 2020 Olympics. According to the Japan National Tourism Organization, the number of foreign visitors in April 2015 alone, pushed near the 1.8 million mark. That is just one month. Japan looks set to be on the way to break another tourism record by this year end.

"The Nikkei may have rallied 50% over the past two years, but the prevailing positive impact of Abenomics means it is not too late to benefit from investment growth in Japan." (Emma Wall, 9 April 2015)

I. Abenomics

We can expect a period of political stability since, Japan's Prime Minister, Shinzo Abe, is still in control. Also, he has the support of Haruhiko Kuroda who was appointed Governor in March 2013. Kuroda heads the Bank of Japan and shares similar views to the Prime Minister. He is supportive of his plans.

II. A Weakening Yen

The yen's declination is transforming Japan's reputation as a newly affordable destination. It is no longer a prohibitively expensive place to visit. The weak yen has made Japan a very attractive holiday option and is turbocharging the country's tourism industry. Foreign visitor numbers have surged, while the Japanese are doing more sightseeing at home.

III. Surge in Tourism

The signs are obvious. There are increasing stores selling second-hand branded goods, employing Mandarin speaking staff to cater solely to the Chinese mainlanders. A combination of Abenomics and a weakened yen has paid off into a surge of tourists from the Chinese mainland. However, the Chinese were not the only tourists.

There has been a steady influx from Taiwan, Thailand and Korea as well. These tourists are coming in by the droves and spending like never before. When you take a walk in any major shopping precinct or attraction, you will hear Taiwanese and Chinese accents, and some Thai. In Bic Camera, a mega electronics store spanning 7 levels of electronic goods, the announcements are made in Mandarin, Korean and Thai. The English version was starkly missing. At Kansai International Airport, you hear and see more than 50% of tourist arrivals there are Chinese mainlanders, with possibly Taiwanese in the mix.

Historically, there is already a strong and regular Korean presence in Japan. There are Korean trains established into the Japanese way of living, where you see Kimchi as a staple item in Japanese supermarkets, and some Korean dishes offered as a common dish on the menu. Takadanobaba, in Tokyo and its surroundings has a robust Korean population. A flourishing Korean economy has been sending an increasing flow of Koreans into Japan, especially as the prices of Korean goods and services has risen significantly.

"Finally, the next most significant development outside of corporate governance reform has been the takeoff of Japan's burgeoning tourism industry. Chinese tourists visiting Japan was up an astounding 80% in 2014, representing a new area of ​​substantive demand. For example, Fukuoka, a gate city in the Kyushu Island with 1.5million residents, welcomes the same number of tourists (1.5million) per year, mostly arriving from China. of any weight restrictions placed on luggage. The economic contribution of tourism is roughly the equivalent of adding 1.5 million people to the population of Japan because so much money is spent. " (David Thorpe, 18 June 2015)

Sources:

• Morningstar
• JP Morgan