Economy, Economy, Economy

Prime Minister Fumio Kishida made a policy speech to the Diet on Monday. Suffering from decline of approval rate for him and unpreferable result of by-elections the day before, Kishida focused on improving economic situation of Japan, saying “It’s economy, economy and economy.” However, it is not clear whether his idea on why economy is so crucial now has been understood by the nationals. Here’s a question: Isn’t economy important for himself to maintain his administration? 

According to his policy speech, it is now or never for Japan to achieve the goal of economic reform for the first time in these thirty years. Calling the trend of past thirty years “cost-cut economy,” Kishida insisted that Japan now has the chance to enter onto a new stage of economy, raising wage increase, capital investment of companies, vigorous stock market and positive demand-supply gap. To the reform for sustainable wage hike and growing economy with active investment, he would be dealing with reinforcement of supply-capabilities for next three years.

 

Kishida listed up the policies for achieving the goal, which included investment to semiconductors or decarbonization, innovation in artificial intelligence or self-driving cars, and reform of monetary and labor market. After all, he is saying that he will back up the corporations or manufacturers for growth. In short, the trend of these thirty years has been deflation, which former Prime Minister Shinzo Abe’s “Abenomics” aimed to get rid of but could not achieved. Kishida’s recognition of current economy and the prescription does not make a big difference from Abenomics.

 

Kishida did not forget to talk about the distribution. “I will mitigate the people’s burden of price hike by returning back a part of increased tax revenue brought by the people’s efforts,” said Kishida in the speech. Kishida ordered the leading parties to consider actual measures for income tax reduction three days before. It is hard to understand that Kishida did not refer to the tax cut in his speech. It is still unclear how he is going to return the tax revenue back to the people.

 

In the policy speech of the previous session, Kishida focused on the measures dealing with low birth rate. This time, he just once referred to it, when he emphasized the need to promote digital transformation as well as measures on low birth rate. Kishida instructed the ministers to fund ¥3 trillion to deal with low birth rate in May, but the details of budgetary resource have not been determined.

 

Kishida also raised some issues such as abductee in North Korea or constitutional amendment. Those are the issues Abe was eager to achieve the conclusion. The consistent reference to those issues indicates Kishida’s loyalty for Abe and his colleagues, on whom Kishida politically depends on.