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Speaking to Eurogamer during a round-table Q&A in Washington DC ahead of the Smithsonian's Art of Video Games exhibition, the Metal Gear Solid creator offered his response to Keiji Inafune's GDC rant about the sorry state of the Japanese industry.
"I think the problem really is more about where people are looking and who they're targeting," said Kojima.
"A lot of creators are just focused on Japan and the Japanese market and aren't really aware of what people around the world want."
He went on to explain that he believes there are three elements that developers need to get right in order to have a global hit: "technology, gameplay and world view."
Kojima argued that Japan is failing to keep up in all three areas.
"Regarding technology, I think in Japan there are less people going abroad, and maybe less people going to, say, M.I.T. and being at the cutting edge of things. From a technology standpoint, I think Japan is lagging behind a bit.
He suggested that that's a problem that can be easily remedied, but the other two issues are potentially more serious.
"The bigger problem is how do you use that technology to create something? When it comes to gameplay, unfortunately a lot of Japanese creators don't really like creating a free experience. Those types of games aren't being made in Japan.
"Regarding world view," he continued, "game creators now are creating games based on the culture they know, targeted at Japan and Japanese cultures. So they set it in places like Shibuya or Shinjuku or somewhere else in Tokyo. And it's not something that appeals to people outside of Japan.
"Because Japan doesn't look outside of it's borders then technologies don't come, creating this vicious cycle."
If developers took a more global view, Kojima argued, they might find it easier to secure bigger budgets.
"The Japanese games industry has fallen to a point where Japanese movies were at as well - these small indie movies set within Japan with a Japanese story done on a low budget. Because the scale is so small we can't get the budget to make it succeed on a global level.
"In contrast to that, most Western studios approach things from more of a Hollywood standpoint where they're looking at making their games a very global success and looking at how they can sell them in various markets.
"From the very beginning they have those goals and are able to get the proper budget and commit the proper technology to it."
Kojima did offer some cause for optimism, however.
"I think that it's still not over. Japan does have the ability to recover from this and get back up to a competitive level, technologically and in other ways.
"I don't want to break this down to a thing where it's Japanese games versus non Japanese games. The key is it has to be a global game, it has to be something made for everybody. I want to get rid of all those barriers."
He offered up his own studio as an example of a Japanese developer taking a more global view of the industry.
"You can tell from my generation that I've been influenced by Star Trek, so when I think of my studio I think it as the Starship Enterprise. The Enterprise had people from all races - even Vulcans! I want my studio to be like that.
"This is my Enterprise. It just happens that the captain is Japanese and the ship was manufactured by Konami, but it's a multi-cultural staff."
This is coming from the guy who gave us Raiden and apparently came up with his design after having surveyed a number of Japanese girls.
But it seems that the only people actually criticizing the Japanese game industry are Japanese devs themselves (except for that Fez guy).
