Abe Unveils Plan for Exports and Investment
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Version 0 of 1. TOKYO — The latest installment of Japan’s growth strategy will aim to triple infrastructure exports and double farm exports by 2020, as well as increase private investment, Prime Minister Shinzo Abe said on Friday. The government will set a target for annual domestic private-sector investment of 70 trillion yen, or $683 billion, Mr. Abe said in a speech to business executives and academics. That is 10 percent higher than the current figure and would restore the investment level before the 2008 financial crisis. Measures to promote growth constitute what Mr. Abe calls the third arrow in his policy quiver as Japan battles to end 15 years of deflation and generate sustainable economic growth. The first two arrows of his program, called Abenomics, are large-scale bond-buying and a burst of government spending. Mr. Abe has promised that structural overhauls like deregulation will be a key part of the package of steps, to be fully unveiled in June. But it also includes a significant role for government in generating investment and innovation in key sectors, a stance some critics see as outdated and ill-advised. The monetary and fiscal stimulus already have yielded Japan’s fastest economic growth in a year in the first quarter, but corporate investment has yet to follow suit. Promising to be a “top salesman” for Japanese infrastructure exports, Mr. Abe vowed to promote private-sector investment at home and asked corporate Japan to do its bit to pass on the benefits of Abenomics. “The government will broadly implement a growth strategy starting with making it easier to invest,” he said, “and I would like you business executives to pass on the fruits of this to working people in the form of jobs and compensation.” Politicians in Mr. Abe’s party, the Liberal Democrats, worry that, while share prices are up and the yen’s value is down — lifting corporate profits — Japanese households have yet to see the benefits in the form of higher wages, although prices are starting to rise. Mr. Abe, who took office in December after a big election win for his party, has said he wants to unveil the growth strategy before a Group of 8 summit meeting in Northern Ireland that begins June 17. That would also come ahead of an upper house election in July that his party needs to win to cement its grip on power and set the stage for a long-term government. Noting that the Japanese economy has begun to show signs of recovery, Mr. Abe reiterated his pledge to free the economy from the “spell” of prolonged deflation and lost confidence. “This is an era in which you cannot survive tough competition unless you are No. 1 globally,” he said, promising that the government would make it easier for companies to invest on a scale needed to compete with foreign rivals. Mr. Abe said the growth strategy would focus intensively on increasing domestic private investment over the next three years, triple infrastructure exports by 2020 and double farm, fisheries and marine exports to 1 trillion yen by the same date. In a nod to the farm lobby, which was upset by Mr. Abe’s decision in March to join talks on the U.S.-led Transpacific Trade Partnership free trade pact, Mr. Abe also pledged to double farmers’ income over the next 10 years. That would ease the pain of scrapping the high tariffs that currently protect many farmers. Mr. Abe also said the growth strategy would aim to increase the number of annual foreign visitors to Japan to 20 million a year, from about 8 million now, and triple the overseas sales of “Cool Japan” content like anime in five years. Experts have said policy measures announced so far contain some positive steps but fall short of a sweeping overhaul of Japanese capitalism with extensive deregulation. Among the areas where the final package is expected to fall short are steps to free up Japan’s rigid labor market to make it easier for companies to shed dying businesses; improvements in corporate governance; and addressing the touchy question of immigration to make up for a shrinking population. |