These same values can be applied to impact investing: are investments meeting the needs of communities with integrity and connection? Building investments from the individual and community level up allows impact measurements to more accurately reflect real change. Below is a summary of key human security issues in Japan. Economic Security Loss of Economic Vitality Japan is the world’s fifth-largest economy, eclipsed by China in 2011, Germany in 2024, and India in 2025. Its standing is threatened by a recession stemming from labor shortages and a weakening yen. The Japanese currency dropped by almost a fifth against the US dollar in 2022 and 2023 3 and, in April 2024, the yen hit a low, trading at only ¥160 to US$1 for the first time since 1990. 4 The impact of the recession on daily life in Japan is significant. As the cost of imported goods rises, inflation strips away wages, and places added pressure on a population already dealing with stagnating economic growth. For lower-income families and retirees—many of whom rely on fixed pensions—the rising cost of living creates financial strain, threatening their ability to afford basic needs. This economic instability threatens Japan’s global standing and ability to participate in global trade and tourism. Japan has neglected its research and development funding (R&D) from 2007 to 2021, with only a modest increase of 5 percent. Meanwhile, its main economic competitors—the US, South Korea, and Germany—have grown their investments significantly by 70-150 percent. 5 Japan’s underinvestment in innovation weakens its ability to compete globally and jeopardizes its capacity to foster the next generation of entrepreneurs. Though Japan has 14 unicorn startups compared to the 739 of that of the US, 6 there is potential for growth, evidenced by a tenfold increase over the past decade and the rising interest among university graduates in joining the startup ecosystem. 7 Regional Loss Japan is experiencing a significant rural-to-urban migration that has only accelerated in recent years. Despite the government’s efforts with “regional revitalization programs” from 2015 to 2019, designed to halt the net population inflow into the Tokyo area by 2020, urbanization continues to intensify. 8 A 2019 report by the Ministry of Internal Affairs and Communications (MIC) showed that eight out of Japan’s forty-seven prefectures experienced a net population gain, with the Tokyo metropolitan area (i.e., Tokyo, Kanagawa, Saitama and Chiba prefectures) receiving the highest number of
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Ten Years in the Making
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