chapter  1957
2 Pages

recession came MITI helped to bring about an agreement

to impose quotas among the leading thirty-three steel firms which reduced total production by 30 to 50 per cent, depending on the products. Then, in 1959 the steel industry moved to the third expansion phase, not heeding the warnings of MITI to exercise

Apart from the help MITI gave for the establishment of cartels and voluntary output restrictions, it promoted 'orderly' exports and the stabilisation and strengthening of the industrial structure. Both these aspects were important to MITI which gave priority to maintaining stable and rising exports and to preparing Japanese industry for the day when capital and trade would be completely liberalised. Exports were of course not only promoted, by a variety of tax measures, but also regulated by assigning export quotas. Export quotas and 'voluntary restraint' were adopted in order to prevent retaliation and the accusation of dumping. As for the strengthening of the industrial structure, MITI maintained the attitude that the larger a firm the more competitive, and consist­ ently urged the important industries, notably automobiles and steel, to merge. But here, too, even MITI with its large arsenal of weapons could not always succeed. Some car manufacturers simply did not heed the advice and later preferred to have links with American firms rather than to merge with Japanese ones.