Japan is witnessing the closure of several century-old regional businesses, highlighting broader challenges facing its economy amid shifting social and geopolitical dynamics. In the past year, three Sendai-area producers of sasakamaboko—leaf-shaped fishcakes—have shut down after operating for decades: Takeda no Sasakamaboko (established 1935), Bajo Kamabokoten (established 1912), and Kaneko Hashinuma Shoten (established 1927). These closures have sparked discussions about whether Japan is entering a “new normal” or something more profound.

The fishcake industry faces multiple pressures, including rising costs for key inputs such as pollock paste and packaging materials, along with higher logistics and labor expenses. Meanwhile, changes in consumer preferences and tourism trends have reduced demand for traditional fish-based products. These economic strains intersect with larger forces like climate change, shifting geopolitics, and demographic decline, particularly in northeastern Japan.

Japan’s long-standing political and economic structures are being tested by these developments. Ryosei Akazawa, the country’s minister for economy, trade, and industry, addressed these issues at a recent press conference. He challenged decades of policy supporting small and medium-sized enterprises (SMEs), which have traditionally been preserved as a buffer against mass unemployment. Akazawa argued that this approach has led to a dependency on subsidies and incentives, fostering a conservative business culture resistant to growth or innovation. He stated that many SMEs lack ambition to expand, describing this mindset as inconsistent with capitalist principles.

Akazawa’s perspective reflects broader geopolitical challenges facing Japan. He has been involved in navigating tense relations with both the United States and China, including dealing with tariffs under the Trump administration and responding to the recent deterioration in Sino-Japanese trade. As Japanese companies withdraw from China at record levels amid a diplomatic freeze, Akazawa emphasized the need to accept a wave of company closures as part of economic realignment rather than trying to prevent them.

Observers note that Japan’s economic environment is characterized less by continuity and more by a series of abnormal conditions layered over time. While it is often perceived as a stable society with many long-lived businesses, this longevity may actually be a form of abnormality in itself. The country’s demographic profile adds complexity; according to the latest census, only 11 percent of the population is under 15, while 17 percent is over 75, a demographic imbalance few other countries face at present.

Efforts at economic “normalization,” including monetary policy adjustments by the Bank of Japan, are part of attempts to address these underlying shifts. Akazawa’s recent comments suggest Japan may require a more fundamental rethinking of its capitalist model, as well as cultural and policy adaptations, to cope with an environment where established economic patterns and societal structures are increasingly unsustainable.

While some critics focus on Japan’s immigration policies or pacifist stance, these issues may overshadow the deeper transformations in economics, geopolitics, and demographics that are reshaping the country. Japan’s experience may offer lessons for other nations confronting similar challenges, though its unique starting conditions and ongoing changes mean there may be no clear or stable “normal” to return to or establish.