NN46, September 2011
Towards a New Global World of Skills Development? TVET's turn to Make its Mark
Skills and Technological Development – Hints from Japan’s Experiences in Iron and Steel Industry
By Kazuhiro Yoshida, Hiroshima University
Email: yoshidak@hiroshima-u.ac.jp
Keywords: Development late-comers; learning from Japan’s Meiji era; localizing foreign technology; sustainability
Summary: Many factors that were key to the success for countries to grow out of underdevelopment over the last half century were present in the policies and approaches adopted by Japan during the Meiji era.
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Many developing countries have enjoyed a period of steady growth over the last decade or so, thanks to strong demand for commodities and raw materials. These countries are embarking on investment in skills development to modernize and increase the value added of the economy and remain competitive in the global economy. Growth led by the private sector has been a model prescribed by the Bretton Woods institutions for a long time. In reality, however, industrial activities of developing countries, especially low-income, are largely accounted for by small scale businesses that do not have capacity to acquire, develop and constantly upgrade skills by themselves. They tend to turn to the public sector for the support, or direct provision of skills development. But the public sector TVET has so often proven to be ineffective, because it lacks good policy, relevant programs and financial resources. How can they avoid this trap?
Late comers have an advantage, because they can learn from successful experiences of the forerunners and thereby achieve the goals faster. Japan was once such a late comer which embarked on its major efforts to industrialize during the later part of the 19th century, the Meiji era. The process of acquiring and internalizing advanced technology and developing the country’s human resources during that period can presents some useful hints.
The iron and steel industry was one of core industries which the Meiji government chose strategically for its known extensive industrial linkage effects and made a significant investment. At the initial stage, the iron and steel mills totally depended on the imported facilities and operated under the technical support from the Western engineers and supervisors. The government paid an extraordinary amount of salary to those expatriates. At the same time, the government sent selected promising youth to study abroad and learn advanced technologies. Upon return, they replaced the foreigners and gradually transferred skills to others and through trial and error developed capacity to build a national plant. During the process of internalizing the modern technology, local knowledge of the pre-existing traditional iron-makers was used in locating the site and choosing materials so that the technologies were best suited to the natural and geographical conditions. Most of the plants developed this way were subsequently sold to the private sector. This is exactly a BOT (build, operate and transfer) that eased the initial financial risk for the private sector which could easily build capital and expand the sector further.
Thus, the Meiji government made a strategic choice with respect to technology; it played dual roles of direct management of the industry as well as stimulating the growth of private industry; the government made conscious efforts to use the existing socio-economic system and local conditions related to the industry; and used foreign knowledge carefully with a clear intention from the beginning to own it and localize it without heavily depending on foreign loans so that the development would be home-grown and sustainable. For this, the government in the beginning did depend on foreign experts, later replacing them with national experts who were initially trained abroad but later at home. The development of university was also a priority for this purpose and engineering was an important discipline, which was followed by development of middle-level skilled workers.
Many of the factors that were key to the success for countries to grow out of underdevelopment over the last half century were present in the policies and approaches adopted by Japan during the Meiji era.
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Cite article as: Yoshida, K., (2011) ‘Skills and Technological Development – Hints from Japan’s Experiences in Iron and Steel Industry’, in NORRAG NEWS, Towards a New Global World of Skills Development? TVET's turn to Make its Mark, No.46, September 2011, pp. 89-90, available: http://www.norrag.org
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