The 2008 white paper on science and technology underlines the difficult situation in which Japan finds itself in the economic and science fields. The government report says that Japan is facing unprecedentedly fierce competition and warns that if Japan fails to ride out this "dreadful storm," it may lose its affluent and stable way of life.
The report identifies the following factors as responsible for this dire situation: a declining birth rate, steep rises in the prices of oil and other resources, and the rise of rapidly developing nations such as China and India.
Pointing out that Japan's economic power is declining in relative terms as a result of stagnancy in the 1990s, the report says that the key to maintaining economic growth is "effective promotion of science" and "creation of innovation," which should involve the country's social institutions.