Global News

Japan shuts itself out from the overseas money-transfer network

Though Japan is opening its doors to foreign workers, it remains a closed country in terms of handling overseas money transfers, failing to see the vital importance of this service for foreigners in Japan. Having people, things and money crossing borders in an increasingly global world, we may see there have been drastic changes in the way capital flows are organized in the world.
World Bank estimates that the amount of money sent from migrant workers overseas to their home countries has swelled up 2.3 times since year 2000, hitting approximately 300 billion US dollars (approximately 33 trillion yen) in 2006. This amount exceeds total government funding provided to the developing countries (104 billion US dollars) and all direct investment made during the same year (167 billion US dollars).
The Bank Law of Japan limits remittance abroad to entrepreneurs with a bank license, so laborers whose home-country financial institutions do not have an office in Japan cannot do much else but use Japanese banks. On top of charging high fees for remittance in comparison with the US private banks, Japanese banks require coming to the office on a weekday, requiring taking time off from work. Another requirement is filling complicated request forms in both English and Japanese.
The number of foreign workers in Japan is approximately 750,000.
This is about 1% of the total work force which is rather low compared to the United States and UK where foreigner workers make up 10-20 percent and contribute to economic growth.
Japanese Ministry of Health, Labor and Welfare estimates that the workforce of Japan will decrease by 10 million in 30 years. Japan will lack between 400 000 and 500 000 nursing staff and up to 40,000 nurses in 14 years. Opening the labor market is the main focus in negotiations with Asian countries on Free Trade Agreement.

Facing fierce international competition, Japan needs to realize that having a global-level infrastructure such as overseas remittance network is directly related to having a competitive edge over the acquisition of highly-skilled foreign labor. Japan should aim for a “Foreigner-friendly yen”.