

A fatal blow to “Made in Japan” label

As Japan works overtime to avert a nuclear meltdown, another crisis could be in the making. There are second thoughts, mainly borne of paranoia, that radioactive particles may reach far beyond Japan's border.

­The fear rises from the seafood, with people wondering whether radiation has got into the water. It is the fear of Japanese imports, going all the way to the top.

US regulators have said they will increase screening of food coming in from the embattled Asian nation. The European Union has warned members to do the same. And Italy was the first EU nation to ban food imports from Japan altogether in the wake of the nuclear scare.

It is fueling suspicion that besides the quake, the tsunami, and the nuclear crisis, Japan will soon have to deal with another problem – becoming a trade pariah – for reasons that may not be entirely radioactive.

“Countries all over the world in tough economic times are looking for ways to subsidize their own producers, their own workers,” said Max Wolff, an economist at New School University. “And so incidents like the one unfolding in japan gives them quite a good reason to do something they may have been looking to do anyway. This is bad for trade.”

Japanese brands play a major role in the US. But with the nuclear disaster there is no telling what the toll will be on  manufacturing for companies like Sony, Toshiba, TDK, and also their brand presence in countries like the US and the status of the “Made in Japan” label, if it comes to mean “made in a nuclear wasteland.”

People will be concerned for a long time, and Japan’s economy will feel it for a long time, too, if trade suffers a major blow.

“Does this drag down an already near zero growth rate in Japan?,” Max Wolff puts forward a key question. “If it does, it’s going to have big internal effects on Japan and globally, and we don’t know exactly what those are but those are potentially quite significant.”

Significant because in a global economy what is made in Japan matters to everyone.

Many of the world's cell phones, laptops, and cars rely on epoxy, computer chips or auto parts from the country. Stoppages in manufacturing and trade can send shockwaves through the system itself, likely to be farther-reaching than the radiation.