New Challenges for Japan

In a recent conversation, I had the opportunity to hear Peter Drucker discussing potential challenges faced by Japan:

• China, South Korea and other parts of the region are becoming increasingly competitive. For example, the products from several South Korean companies are given increasingly high ratings for quality - Japan used to be way ahead in this area.
• The Japanese ecomomic miracle was created by a workforce that was extremely motivated, hungry and driven. The new generation of younger Japanese workers may not have the same level of drive.
• I was amazed by the emotion behind the anti-Japanese marches when I was recently in China. Questions regarding what happened in World War II sill produce a lot of anger.

If you were an advisor to the Japanese government (or to large Japanese companies) - what suggestions would you have? Predict the economic future - what is going to happen in Japan?