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The end of the Pacific War in 1945 should have economically and psychologically spelled doom for Japan By the end of the Pacific War the volume of Japans industrial production was less than thirty per cent of her output in 1936 Tokyo was literally three quarters flattened The Japanese Navy was at the bottom of the sea and so was most of the merchant marine The Japanese had no exports no foreign trade and inflation destroyed all of Japans private savings The total estimate of damage caused by the Pacific War to the Japanese General Wealth was 65 302 million Yen yet somehow the Japanese found a way to recover its economy within ten years despite numerous problems Overall the Japanese economywas able to register the highest growth rate in the world after World War II With astounding facts like this one should consider why and how the Japanese were able to recreate a booming and wealthy nation despite all of its adversities The growth of the postwar Japanese economy can be divided into two stages as the years before 1955 represent the stage of post war recovery and the years after 1955 can be labeled as the stage when the economy witnessed a new development quite unlike that of prewar days Thus through identifying what aided the Japanese economic growth from the periods 1945 to 1955 and 1955 to 1961 one will be able to realize why the Japanese were able to recover from her war losses prosper and become one of the wealthiest and most powerful nations in the world The Japanese faced numerous problems after their defeat in the Pacific War that should have dehabilitated the country so greatly that it should have become a Third World nation The Japanese faced a shortage of fuel power and raw materials inadequate transport and a fear that equipment might be seized for reparations As well the Japanese had lost its colonies and foreign
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