And that's after two decades of little to no growth. If Abe were able to turn Japan around, it might find itself again as a power, with its voice carrying weight in Washington and other capitals. And that would have a profound effect on the geopolitics of Asia and beyond.
Though a stronger Japanese economy would not in itself lead to a massive increase in Japanese military capabilities, it would make it easier to spend more on defense, and also to boost foreign assistance programs to U.S. allies such as the Philippines, a move that a cash-strapped Washington would welcome. In early January, Philippine Foreign Secretary Albert del Rosario said that to help it counter the threat posed by China, Japan would supply the Philippines with 10 coast-guard vessels as well as communications equipment. A wealthier and more assertive Japan could enlarge these assistance programs throughout Southeast Asia so that countries in the region might decide to court Tokyo rather than appease Beijing.
Tokyo's increased assertiveness would also make it easier to play hardball with Beijing. China applied unilateral sanctions against Japan in the wake of the 2010 and 2012 crises over the Senkakus, the disputed islands in the East China Sea that the Chinese call the Diaoyus. These included restrictions on exports of rare earths, delays at customs for Japanese goods, and support for boycotts of Japanese goods and services.
Japan barely responded to China's provocations. But an economically more self-confident Japanese cabinet might have counterattacked with its own "administrative guidance" on Chinese imports, curtailed the export of Japanese technological inputs to Chinese state-owned conglomerates, and made customs checks for Japanese tourists returning from China sufficiently long to induce them to vacation in other countries. Japanese technology and foreign investment are more important to China than Chinese trade is to Japan. That doesn't mean China would back down, of course -- more assertiveness by Japan raises the odds that Chinese leaders, fearing that appearing soft on Japan would make them vulnerable, could decide to escalate tensions. But it would make such showdowns more of an even fight.
All of this depends, of course, on whether Abe can succeed where his 15 recent predecessors -- including himself -- have failed. The Japanese establishment has no interest in being the England of Asia and joining the United States in its wars, or of returning to its imperial past. But a healthy Japanese economy would remind China it's not the only game in town.