ELIMINATION OF THE SHADOW ECONOMY IN JAPAN-RUSSIA TRADE: COUNTRY-SPECIFIC APPROACHES TO IMPORTS OF CRABS AND EXPORTS OF USED VEHICLES

Abstract

The early 2010s brought significant changes to the regional trade between neighboring provinces of Japan and Russia. In particular, international cooperation has allowed elimination of illegal deliveries of Russian crabs, and the rationalization of domestic used cars circulation in Japan has reduced stolen vehicles’ exports. In the first case, reduction of the shadow economy caused a sharp drop in trade, indicating a trade-off between sustainability of marine resources and volumes of operations. In the second case, the decrease of Japanese used cars exports to Russia was connected to the state of the Russian automotive market: crisis drop in sales, changes in domestic demand for second-hand cars and protectionist restrictions by the Russian government. Therefore, it is possible to speak about country-specific approaches for elimination of shadow economy in Japan and Russia. These differences should be considered in development of bilateral economic cooperation.