10 PREDICTIONS FOR 2018

 

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This year-end post at my blog has become something of a tradition, which now already enters its 7th year.

I have to admit that I seriously considered to quit over the last days. Why? It will be difficult to top the success ratio of last year`s predictions. Eight predictions turned out to be out right on spot, be it on Toshiba, the Nikkei index or the EU-Japan EPA.
If I were soft on myself I would call even my prediction that Yuriko Koike`s “dream of becoming the first female premier in the future will slowly evaporate” on target – but I have to be honest. That was not slow but rather an implosion at breath-taking speed. The only other wrong prediction was a Literature Nobel Prize for Haruki Murakami (but at least it was his country-man Kazuo Ishiguro receiving that prize – so not completely off either).

But let us move to 2018. Do not expect another smashing 80% plus of the predictions to turn out right. But you might find some fun in reading it and maybe a clue where to investment your money. Here we go:

1) Politics 1: I start with a daring prediction. Japanese-Korean foreign relations will significantly improve over the next 12 months.
2) Politics 2: It will be boring year for domestic policies in Japan. Whatever is left of the opposition will stay invisible. And there will be even less scandals of the Abe`s government to provide some change to what we have gotten used over the last years, a well-oiled political engine running without major problems.
3) Politics/Economy 1: Bank of Japan Governor Kuroda will stay in his job and the ultra-loose monetary policy will continue despite rising calls for serious tightening.
4) Economy 1: The Nikkei index will continue its impressive climb and even challenge the 25,000 mark in the next 12 months.
5) Economy 2: The Japanese yen will further weaken for some time but end 2018 stronger than it stands today.
6) Business 1: Japanese overseas M&A in the U.S. market will further rise, which is of great importance over there as the investment climate for Chinese companies has reached chilling temperatures with no fast recovery to be expected under the Trump government.
7) Business 2: Watch out for Toyota. I expect them to make a move that is even daring by non-Toyota standards.
8) Sports 1: I sincerely hope that reality will prove me wrong on this. But I do not see the Japanese soccer team making it beyond the group stage in the World Championships in summer.
9) Sports 2: But Japan will throw in a record performance at the Winter Olympics (with even Yuzuru Hanyu repeating his 2014 gold feat if – here is my only disclaimer – he manages to perform at all as he still is seriously injured 40 days prior to the Games kicking of on February 9).
10) Society 1: Finally, I have to give up my bet on the Nobel Prize for Haruki Murakami but there will be another Japanese receiving the Nobel call in 2018 – watch out.

Jochen Legewie

Jochen Legewie

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