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As Japan embarks on the new Reiwa era, it stands tall as the world’s third largest economy, as well as a tried and tested global leader.  Japan is a country that has seen it all: name a major macroeconomic challenge now confronting world economies – from navigating slow growth, to maneuvering around negative interest rates, to adjusting to an aging labor force – and chances are that Japan confronted it first, and has already emerged wiser and more experienced in the new ways of the world.

Rather than wallow in self-pity, Japan is instead looking forward to new beginnings, as exemplified by the gusto with which it has seized a once-in-a-generation opportunity to host the upcoming 2020 Olympic Games. There, Japan hopes to show the world some of the lessons it has learned about how to seize the future: from robot greeters to AI security systems to advanced recycling systems, the Games will reveal a Japan that’s more connected to the world than ever before - in every sense of the term.

The Olympics are a prime example of how modern Japan feels empowered to write itself a new story. It’s a story that moves beyond the discouraging clichés of the recent past to arrive at a more balanced, hopeful picture of the country’s future.

For starters: Modern Japan is not a stagnant society. It’s a resilient one. Yes, GDP growth has remained stubbornly low – with the 2019 first-quarter figure of 2.8 percent likely to stand as a high water mark amid mounting trade tensions and a strengthening yen. While recent international trade deals have provided political and psychological reassurance that Japan has friends on the world stage, they won’t necessarily guard against downward pressures on exports. At the same time, however, Japan remains in many ways a highly desirable to live: a place where good healthcare and a strong educational system exist alongside near-unparalleled cultural riches.

What’s more, Japanese businesses – with the support of a highly skilled and innovative central bank – have learned how to make the most of their challenging situations. Many have become highly skilled at navigating VUCA (Volatile, Uncertain, Complex, and Ambiguous) environments, which will serve them well as they compete for global market in an era of uncertainty.

Consider, for instance, the way that Uniqlo has married aesthetic sensitivity with technical know-how to create products that appeal to budget shoppers and fashion devotees alike. In just a few short decades, it has become one of the largest apparel brands in the world – all in an era when many other mass apparel businesses have retrenched or collapsed in the face of e-commerce’s rise.

Or consider the resilience and ingenuity of Nintendo, a company that has time and again courted risk and even failure in its pursuit of truly innovative gaming formats. The story of how Nintendo regrouped and recovered from its disappointing Wii U launch – amid existential fears that mobile gaming would render its business obsolete – is a quintessentially Japanese story of perseverance in the pursuit of excellence. Today, its Switch console is a best-seller, and the company is more vital than ever.

In the realm of digital technology, much has been made of the differences between the Japanese business environment and Silicon Valley, with the latter being far more successful in launching globally powerful “unicorns.” In recent years, however, that narrative has been complicated by the rise of Son Masayoshi’s Softbank Vision Fund, and its role in backing some of the world’s most exciting digital startups – names like Uber, TikTok, Slack, DoorDash, and WeWork. For many founders and entrepreneurs, the road to digital dominance once again travels through Japan.

Credit should also be given to Japanese digital innovation in the realm of e-commerce, with brands like Rakuten and an emerging Yahoo-Zozotown alliance proving that Japan can compete at home – and perhaps abroad – with the likes of Amazon. Resale platform Mercari, meanwhile, has found a way to make frugal shopping feel fun, fashionable, and virtuous (as buying used items cuts down on environmental waste). It is a strong example of how Japanese brands can meld social responsibility and commercial ingenuity, and make the most of a low-growth climate.

That Japanese e-commerce brands have succeeded in a country where consumers overwhelmingly prefer cash transactions is, once again, a testament to Japanese persistence in the face of structural headwinds. As Japanese banking brands roll out more digital wallet options in the years to come, this could be a segment that’s primed for future growth.

None of this is to suggest that everything in Japan is perfect, of course. As will be explored later in this report, there is a fair case to be made that Japanese brands are underperforming globally relative to their economic potential. And even putting growth rates and earnings reports aside, there remain real structural impediments to creating a more vital, inclusive Japanese economy.

Even in an age of near-full employment, many young Japanese people feel hopeless about the prospect of finding a good job; others feel massively overworked and underappreciated in the jobs that they do hold. And for all the debate about “Womanomics,” Japanese women still face major impediments to equality at home and in the workplace. And while Japanese citizens’ physical health is typically well-provided for, there remain major gaps in how the country approaches issues like mental health care and social isolation – as has been made clear in a number of recent tragic incidents.

As Japan embarks on its new chapter, it also faces a number of economic and political uncertainties. Chief among them is whether recently reelected Prime Minister Abe Shinzo’s  “Abenomics” – a combination of monetary policy, fiscal policy, and structural reforms – will fully bear fruit, especially in the face of a national consumption tax increase. Another open question is how Japan will fully absorb the impact of an aging population – and what society will look like if marriage and birth rates continue to decline. A need for increased migration may become yet one more policy puzzle that Japan will have to solve.

That being said: What country doesn't face its fair share of uncertainty? If anything, Japan enjoys a significant advantage in productively facing down existential threats, as it has been confronting these types of challenges for several decades now. Compared to their counterparts in other countries, Japanese businesses and citizens have become experts at innovating in the face of existential problems – problems that would strike panic in the hearts of less experienced actors.

No matter the headline growth rate, Japan is not and will not be a country that is content to stand still. It has strong fundamentals, an educated and conscientious citizenry, and leading global businesses that together are worth hundreds of billions of dollars in brand equity. Although the Reiwa era is scarcely underway, it is already clear that the country’s story going forward will be one of hope: an era in which people choose resilience over retrenchment, and ingenuity over complacency.