The Japanese government is taking a high-pressure approach to bars and restaurants refusing to comply with coronavirus prevention measure requests, which include shortening business hours and restricting alcohol sales. We do not believe these strong-arm tactics can win their cooperation.
Tokyo is now under its fourth COVID-19 state of emergency, scheduled to run until Aug. 22. The capital's bars and restaurants have been asked to stop serving alcohol until then.
What has caused a problem is the government plans announced by economic revitalization minister Yasutoshi Nishimura, which included calls on financial institutions to pressure their clients in the hospitality industry not to sell alcohol. This provoked an angry reaction from the restaurant sector, as well as criticism from within the ruling parties. The policy was reeled back in the next day.
However, the plans also included for government bodies, such as the National Tax Agency (NTA), to demand alcoholic beverage businesses to cease dealing with restaurants serving booze during the state of emergency, and that element was not withdrawn.
Japan's pandemic special measures law allows authorities to issue orders to businesses failing to follow infection prevention measure requests, and to fine those that still do not comply. However, there is no legal basis for calling on businesses to pressure their clients or for these demands from government agencies like the NTA.
The government is so fixated on restricting alcohol service because the viral transmission risk is thought to rise at group meals where people are drinking. A National Institute of Infectious Diseases study comparing subjects who had attended multiple group meals where the alcohol was flowing with subjects who had not found that the infection risk was almost five times higher for the first group.
The previous state of emergency was only lifted on June 21, meaning restaurants and bars are being asked to stop serving alcohol once more after just three weeks. This is a serious blow to their businesses. Meanwhile, support payments to establishments complying with the government's requests have been very badly delayed. It is a virtual certainty that among the businesses out there struggling to raise enough cash to keep the doors open, there are some in such dire straits that they cannot follow the government's demands even if they want to.
According to a private research organization, 715 bars and restaurants went out of business in fiscal 2020. Of those, 183 were bars or beer halls -- the most since fiscal 2000.
Regarding the support payments for cooperating businesses, the government has said it plans to introduce a system to pay the money in advance on condition businesses submit the necessary paperwork -- including an oath to refrain from selling alcohol during the restricted period. This needs to be put into effect with all haste.
The government must look afresh at the intense distress of businesses hit hard by the coronavirus crisis. And it must not only carefully explain the need for transmission prevention measures, but also earn these businesses' cooperation.