Economic Potential of Japanese Co-Prosperity Sphere (Post 1942)

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As it says, if Japan were to somehow obtain some negotiated ceasefire after the southern campaign and claimed the following territories as seen on the map..

What do you believe would have been the short and long term economic prospects for the co-prosperity sphere?

What economic policies do you believe would have and/or should be enact to stabilize the economic situation?

Could this enlarged Japan potentially dominated the global market?
 

Deleted member 1487

Are you assuming free trade then is available to Japan? IIRC their assumption wasn't just to get the raw materials out of their sphere, but to have old style European colonialism with market preference for their exports. So their trade block would mostly not participate in the global market except on a limited basis. I assume they would take all of China at some point as that was their goal. In that case they have a very large chunk of the global market, but the issue is that it would remain less industrialized than it would become IOTL because of keeping the much larger area subordinate to Japan's economy, rather that it participating in the global trade structure. I doubt it would dominate the global economy because of the less than competitive Japanese industry practices at the time, their lag in innovation at the time, and probably the lack of willingness of the rest of the world to trade with them on a large scale basis. In fact the global economy is actually retarded by these trade blocs, as they cut off free trade and development of a global economy, as there is a lot of duplication of effort within the trade blocs and the blocs are structured to the benefit of the dominant power; one of the major charges levied against British colonialism is that it retarded the economic growth of places like India because it kept it subordinate to British industrial preferences, rather than letting the Indian economy develop on its own and find its place in global trade for its own benefit. China and the rest of the sphere would have the same problem ITTL, especially as Japan slaughters to political subdue the Chinese and other peoples to make them conform to Japanese culture and political preference. If anything the great co-prosperity sphere would end up being a mess like a Nazi dominated Europe would be, but moreso, as the Japanese have less population than their dominated peoples and would need to use even more slaughter and repression to keep it subordinated.
 
Assuming we get past the nearly ASB possibility of a negotiated peace, and Japan manages to hold all their territory, The Co-Prosperity Sphere could easily become the largest economy in the world by the 80's or 90's.
 
(Other than the fact that this is a terribly unfeasible scenario)
We can base our analysis on what we see IOTL: Manchukuo. Led by the Japanese military with a puppet government, the country will see some interesting levels of growth.
Expect dissent for at least the first several years. Considering the Japanese actually supported nationalist movements this may prove to be harder as things progress.
The economic system would be based around the low wages that would be enforced by the Japanese military; considering how efficient Manchukuo was due to this, quick economic recovery may be expected.
Unlike Manchukuo, most of Southeast Asia would continue to develop its industry around lumber(although rice would still be very important and oil will be hugely developed in Malaya and Indonesia).
If this is expected to be a pseudo-supranational organisation as Manchukuo was, then economic recovery will be slow but sustainable; the individual countries may even be able to reach self-sufficiency(as did Manchukuo).
Furthermore since they are all connected within proximity to each other by water trade will be very accessible.
Inflation may become an issue, as many of these regions were forced to use Japanese military yen - and the currency was produced like crazy, since that was how the military was paid for wages.
Overall interesting scenario.
 
If the POD is after Dec 7, 1941 this is flat ASB as Japan had no chance against 1942 US and a ceasefire was unthinkable for 1942 after Pearl Harbor so we have to change the POD. Even if it is before it is very nearly ASB as there are far too many Chinese. Let's assume that the POD is Hitler declares war on the US or vice-versa some time in late 1940- early 1941 and being too distracted in Europe the US doesn't place the oil embargo on Japan or better yet no scrap iron embargo. Somehow the Japanese are able to restrain their military from going further into China that they already were. In that case the Japanese economy is still a mess due to its pouring money into China trying to maintain a hold on what they already captured. China is a mess trying to hold what it has fighting civil war between the Nationalists, the Communists and the war lords. It also needs to keep an eye on Japan even if it isn't fighting. In short things get worse and worse in Japan and China the longer the war lasts.

Decolonization is delayed a few year or decades but it was going to happen sooner or later. Even without the Japanese front France was overrun and GB deeply in debt. It is hard to see how their imperial systems would last long after the war.
 
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Forget the Philiphines (maybe it was German in WWI and the Japanese got it) and the US (distracted by Europe and with its major Pacific holding being Hawaii).

Could such a Japanese Empire prosper? Manchuria worked for them, But mainland China was a sinkhole and even a negotiated peace will leave a closed or hostile Chinese market. The resources are pretty major to keep the Japanese industry going for decades and a succesful colonization program in Formosa and the minor Pacific islands could give Japan enough manpower plus any colonial manpower that works with them.

But their racist views and desire to be the Britain of Southeast Asia when British colonialism implodes in India will be a terrible example for the colonial nations of the Sphere.

Eventually the cost of keeping their territories down and a resurgent China will spell doom for any longer term ocupation of the Empire and bring it down.
 
Assuming we get past the nearly ASB possibility of a negotiated peace, and Japan manages to hold all their territory, The Co-Prosperity Sphere could easily become the largest economy in the world by the 80's or 90's.

Possiblly, but the Japanese are going to have to make some radical changes in their 'management' techniques. Among other things the Japanese business leaders of the 1930s & 1940s were uniterested in Free Trade. They were thinking in terms of monopolies, restrictive licenses, ultra cheap labor, restricted markets, protective tariffs & restrictions. Anything but a free market.

Also handing over administrative policy in the occupied nations to the Army had some severe down sides. Corruption, brutrality, and senseless policies being some of them.

Japans economic boom in the 1950s through 1970s was based on relatively free markets, relatively uncorrupted government, other rational business policy/laws, and a very small military cost to the economy. Very little of that applied to Imperial Japan of 1937 - 1941.
 
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