Japan is the smoker's paradise: the country where the no-smoking section on some domestic flights consists of rows 58, 59 and 60; where you can light up a cigarette in a res-taurant and blow tobacco smoke over your neighbour's sushi without fear of complaint; where office cleaners on their morning rounds fill full-sized buckets with the contents of yesterday's ashtrays.

Smoking may be declining sharply all over Europe and America - it has become almost anti-social to light up a cigarette at a party in New York or San Francisco. The social pressures are ineluctable, the medical arguments indisputable. But not in Japan. Here there is no anti-smoking culture at all, no non-smoking areas anywhere, and it is considered quite unacceptable for non-smokers to complain. If you want someone to put out a fag, you probably have to dream up an allergy: all reminiscent of a time in Britain that seems long gone. At about 36 per cent, the proportion of Japanese adults who smoke is the highest in the industrial world.

In Japan, people smoke all the time, regardless of what they are doing. They wave cigarettes recklessly back and forth at arm's length as they stroll along shopping streets. They puff furiously as they travel by bicycle, with one hand on the handlebars and the other holding an umbrella. They even smoke in the countryside: an hour's train journey outside Tokyo, hikers in breeches and long socks walk through the mountain forests, picking wild mushrooms and watching the deer. When they pause for a drink from the streams, out come the packets of Mild Sevens or Larks. In a country that abhors litter, cigarette ends are the only type it is socially acceptable to drop.

Tobacco in Japan is largely a modern fashion. It first became popular after American warships opened the country to the outside world in 1853. But it was not until the rebuilding of the country from the nuclear ashes of 1945 was under way that the average Japanese could afford to smoke. Cigarettes became one of the symbols of industrial revival, like the amphetamines that workers would take to sustain themselves through the long factory day. But amphetamines, like most other drugs, are no longer tolerated in Japan. Only alcohol and tobacco have survived the country's rise to industrial prominence.

Most governments face a dilemma when it comes to cigarettes; how to set duties to public health and the cost of treating smoking-related diseases against the revenue from tobacoo taxes. Western European governments - with the exception of Britain - impose a ban on tobacco advertising; even as they protect the billions rolling into their coffers, they make serious attempts at educating their citizens about the dangers. Japan has no such dilemmas. There they just smoke.

But what about health? Don't the Japanese care? While the proportion of the adult Japanese population that smokes is half as high again as in the US, Japan's rate of lung cancer is in fact 40 per cent lower. So the health-cost arguments for an ambitious public information campaign seem weaker. But this may simply be a matter of time: smoking is relatively new to Japan. It was only in the Sixties that it became a national pastime. It may be that the cancer has simply not had time to take hold.

The financial rewards of keeping the people smoking are formidable. Even with cigarettes costing only around pounds 1.50 a packet, the Japanese government makes pounds 10bn a year from tobacco taxes. It is the sole owner of Japan Tobacco, a company that used to hold a national monopoly over both tobacco and salt. It was no coincidence that when Japan was called on to make a dollars 13bn contribution towards the cost of fighting the Gulf War against Saddam Hussein, the two products on which it chose to raise taxes first were tobacco and oil. In spring 1994, the government is likely to raise still more billions by selling off on the stock market one-third of Japan Tobacco. The Ministry of Health and Welfare's anti-smoking campaign has an annual budget of little over pounds 130,000; in Japan public advertisements for the World Health Organisation's No Smoking Day avoid controversial images such as pictures of smokers or cigarettes, or medical diagrams of lung cancers.

Cigarette packets sold in Japan must carry a warning of the dangers of excessive smoking - but they give consumers no hint that even a few cigarettes a day may cause cancer. Packets also carry the prohibition that they must not be sold to children, but in truth this means almost nothing. A huge number of cigarettes are sold through vending machines - the industry's way of making sure it can sell to anybody tall enough to reach the slot. Japan has one cigarette-vending machine for every 200 people. While regulations require that machines selling drinks and other products must be switched off at night, the cigarette machines are open 24 hours a day. Emblazoned with slogans in English such as 'Smokin' Clean' and 'Nice day, Nice Smokin', they are everywhere: at every street corner, in the corridors of the Health Ministry, even at the top of Mount Fuji.

Most frightening of all, there is no serious attempt to teach schoolchildren that smoking can be bad for them. On the contrary, some experts believe that between 50 per cent and 70 per cent of Japanese teenagers smoke. And it makes strange watching: teenagers in school uniform, conformist and regimented in every way, yet smoking in droves. There has been a slight fall in the adult male smoking rate of late but whether it will sustained is not something you would bet on.

Japanese women are in most respects more fastidious than Japanese men. Yet the relentless messages on billboards, in the press and on television are having their effect. Until recently it wasn't considered polite for a well brought up Japanese woman to smoke in public. Japanese women in offices would retire to the lavatory to smoke unseen. But that, too, is changing: young Japanese women are happy to be seen smoking and increasingly many of them do.

How long can the Japanese continue to smoke without paying the price? Some epidemiologists believe that it takes on average 23 years before cancer symptoms start to appear and that any idea that cancer is not a threat is simply the result of it being too soon to know; that the impact of the growth in smoking has simply not yet worked through to show its ravaging effects. Today's calculations are distorted because the growth of smoking has not yet fully fed through into the cancer statistics. Other epidemiologists believe that the Japanese are genetically less prone to develop lung cancer than Westerners, just as they are far more prone to contract stomach cancer, which is one of the leading causes of death in Japan. Yet others think that the Japanese diet - green tea, seafood and certain kinds of fats found in oily fish - helps to counteract the harm that is done by cigarettes. But most believe that Japan will be flooded by lung cancer cases in the early 2000s, just as its working population is gasping under the burden of supporting the world's highest proportion of over-65s.

Meanwhile, the opening of the Japanese tobacco market to foreign competition has made it the biggest foreign market for American cigarettes and given US firms the chance to steal some market share from Japan Tobacco. Television advertising of cigarettes, which is banned in most other industrial countries, remains a huge business in Japan. In 1983, the country's commercial broadcasters put out around 20 hours of cigarette advertisements a week between them. By 1990, with the Americans pushing to expand their market share, that had risen to 104 hours a week - a number that has been only slightly dented by the recent rule that such advertising must not start until just before the 11pm news.

(Photographs omitted)