• About Us
    • Fact Checking Policy
    • Ownership & funding information
    • Volunteer
  • Subscribe
  • Letter submission
    • Submissions Policy
  • Contact Us
The Online Citizen Asia
  • Opinion
    • Editorial
    • Commentaries
    • Letters
    • Comments
  • Current Affairs
    • Singapore
    • Malaysia
    • Indonesia
    • China
    • ASEAN
    • Asia
    • International
  • Finance
    • Economics
    • Labour
    • Property
    • Business
  • Community
    • Arts & Culture
    • Consumer Watch
    • NGO
    • Lifestyle
    • Travel
  • Politics
    • Civil Society
    • Parliament
    • Transport
    • Education
    • Environment
    • Health
    • Housing
  • Law & Order
    • Legislation
    • Court Cases
No Result
View All Result
  • Opinion
    • Editorial
    • Commentaries
    • Letters
    • Comments
  • Current Affairs
    • Singapore
    • Malaysia
    • Indonesia
    • China
    • ASEAN
    • Asia
    • International
  • Finance
    • Economics
    • Labour
    • Property
    • Business
  • Community
    • Arts & Culture
    • Consumer Watch
    • NGO
    • Lifestyle
    • Travel
  • Politics
    • Civil Society
    • Parliament
    • Transport
    • Education
    • Environment
    • Health
    • Housing
  • Law & Order
    • Legislation
    • Court Cases
No Result
View All Result
The Online Citizen Asia
No Result
View All Result

What has Shinzo Abe’s signature ‘Abenomics’ achieved?

by The Online Citizen
28/08/2020
in Asia, Economics
Reading Time: 3 mins read
2

Source: Reuters

by Etienne BALMER

When Japan’s Shinzo Abe took office in 2012, he vowed to reinvigorate the country’s economy with a policy that came to be dubbed “Abenomics.” But what has the programme achieved?

As the prime minister announced Friday he will resign, here is a look at the key goals of the policy, and the extent to which they have been achieved:

Major monetary easing 

On his return to power after a disastrous first term between 2006-2007, Abe cut a deal with the Bank of Japan that saw the central bank implement a policy of unprecedented monetary easing.

The goal was to reduce the cost of borrowing, stimulating business activity and personal consumption, and pushing inflation up to a two percent target to end the deflation that had haunted the Japanese economy since the 1990s.

The BoJ’s policy helped strengthen the competitiveness of Japanese exporters by weakening the yen, but the inflation target has remained stubbornly out of reach.

The Japanese economy has gradually recovered and prices have slowly increased, but are still far short of expectations.

The country even experienced deflation between 2015 and 2016, which made an unwelcome return this year with the global economic crisis caused by the coronavirus.

Government spending galore 

The BoJ’s efforts were paired with stimulus in the form of massive government spending, the second of the “three arrows” of Abenomics.

Hundreds of billion of dollars was spent from 2013, particularly for the modernisation of infrastructure nationwide, some of it with an eye on the Tokyo 2020 Olympic Games.

The spending boosted revenue and investments for business, stimulated financial and real estate markets and helped support the country’s growth for several years.

But it didn’t stop the national economy from derailing several times: GDP contracted between 2014-2015 before recovering, and the country fell into recession again in 2020, even before the coronavirus crisis hit.

With an ageing population more inclined to save than spend, consumption has remained stubbornly low. And spending was hit further by two consumption tax hikes, in 2014 and 2019.

Economists warned both times that the increases would send the economy into reverse, but the government pushed ahead, spurred by its burgeoning obligations in a country with the world’s highest debt-to-GDP ratio.

With the coronavirus causing economic devastation, and domestically forcing the postponement of the Olympics and a nosedive in tourist revenue, the government has unleashed massive new stimulus.

But Japan’s growth potential is dropping because “the government lacks a green recovery vision and digital initiatives,” said Sayuri Shirai, a professor in Keio University’s faculty of policy management and former BoJ policy board member.

Structural reforms 

The first two arrows of Abenomics could not work without the third pledged by the premier: structural reforms.

A chief target was Japan’s labour market, characterised by a post-war boom era model in which workers could expect life-long employment and extensive benefits in jobs at one of the country’s behemoth firms.

But attempts to overturn the calcified model and promote greater flexibility have moved too slowly, experts say.

“At first we thought the government was buying time by monetary easing and fiscal policy, to prepare for structural reforms which are painful,” said Masamichi Adachi, an economist with UBS.

“However this time was not used wisely for structural reforms,” he told AFP.

There have been some bright spots, including a rising number of women and older people in the workplace, and some loosening of the country’s strict immigration policy, which may help tackle chronic labour shortages.

But many of the reforms “have been not bold enough” to boost labour productivity,” Shirai said.

The pandemic, she added, revealed “not only Japan’s corporate sector vulnerability but also inadequate electronic public services” and the slow implementation of government policies.

 

— AFP

For just US$7.50 a month, sign up as a subscriber on The Online Citizen Asia (and enjoy ads-free experience on our site) to support our mission to transform TOC into an alternative mainstream press.

Related Posts

Myanmar town pleads for help as thousands flee fighting
Myanmar

SAC-M calls for a step-up on support for Myanmar’s democratic movement

01/02/2023
Tourism arrivals and tourism receipts to remain weak in 2021 despite development of vaccines: STB
Singapore

SG scores 5th as least corrupt country but its ranking dropping – illicit financial flows through SG

01/02/2023
They have done a fine job of confusing us about the jobs situation
Labour

They have done a fine job of confusing us about the jobs situation

01/02/2023
38-year-old Indian mother who has her two kidneys “stolen”, deserted by husband
Crime

38-year-old Indian mother who has her two kidneys “stolen”, deserted by husband

01/02/2023
Can we trust the words of prosecutors, police officers, civil servants and their witnesses at face-value?
Opinion

Can we trust the words of prosecutors, police officers, civil servants and their witnesses at face-value?

01/02/2023
Myanmar junta prepares for poll, raising fears of more bloodshed
AFP

Myanmar marks coup anniversary with eyes on junta election plan

01/02/2023
Subscribe
Connect withD
Login
I allow to create an account
When you login first time using a Social Login button, we collect your account public profile information shared by Social Login provider, based on your privacy settings. We also get your email address to automatically create an account for you in our website. Once your account is created, you'll be logged-in to this account.
DisagreeAgree
Notify of
Connect withD
I allow to create an account
When you login first time using a Social Login button, we collect your account public profile information shared by Social Login provider, based on your privacy settings. We also get your email address to automatically create an account for you in our website. Once your account is created, you'll be logged-in to this account.
DisagreeAgree
2 Comments
Newest
Oldest Most Voted
Inline Feedbacks
View all comments

Latest posts

Myanmar town pleads for help as thousands flee fighting

SAC-M calls for a step-up on support for Myanmar’s democratic movement

01/02/2023
Tourism arrivals and tourism receipts to remain weak in 2021 despite development of vaccines: STB

SG scores 5th as least corrupt country but its ranking dropping – illicit financial flows through SG

01/02/2023
They have done a fine job of confusing us about the jobs situation

They have done a fine job of confusing us about the jobs situation

01/02/2023
38-year-old Indian mother who has her two kidneys “stolen”, deserted by husband

38-year-old Indian mother who has her two kidneys “stolen”, deserted by husband

01/02/2023
Can we trust the words of prosecutors, police officers, civil servants and their witnesses at face-value?

Can we trust the words of prosecutors, police officers, civil servants and their witnesses at face-value?

01/02/2023
Myanmar junta prepares for poll, raising fears of more bloodshed

Myanmar marks coup anniversary with eyes on junta election plan

01/02/2023
No update on Karl Liew’s criminal hearing for providing false evidence against Parti Liyani

No update on Karl Liew’s criminal hearing for providing false evidence against Parti Liyani

01/02/2023
Record jobs growth in 2022, but no breakdown of the foreign and local workers in the workforce and jobs growth

Record jobs growth in 2022, but no breakdown of the foreign and local workers in the workforce and jobs growth

01/02/2023

Trending posts

Former Singaporean shares change of life in Australia with annual pay of S$80,000 as a plumber

Former Singaporean shares change of life in Australia with annual pay of S$80,000 as a plumber

by Yee Loon
30/01/2023
19

...

Two Indian nationals paid about S$330 and S$730 respectively for forged certificates submitted in their S-Pass application

MOM found issuing EPs meant for foreign PMETs to PRC waitress and general worker

by Correspondent
26/01/2023
41

...

Earning only S$400 a month, delivery-rider turned hawker threw in the towel after two years of running a rojak stall

Earning only S$400 a month, delivery-rider turned hawker threw in the towel after two years of running a rojak stall

by Yee Loon
26/01/2023
24

...

Indian rupee falls 60% since signing of CECA while Singapore becomes top investor in India

by Correspondent
25/01/2023
67

...

Temasek and GIC reportedly in talks with Adani Group accused of “brazen” market manipulation and accounting fraud

Temasek and GIC reportedly in talks with Adani Group accused of “brazen” market manipulation and accounting fraud

by The Online Citizen
26/01/2023
58

...

Ho Ching breaks silence over Temasek’s write down of its US$275 million investment in FTX, says it “can afford to be contrarian”

US regulator questions VCs’ due diligence work prior to investing in FTX; Ho Ching says Temasek can afford to be contrarian

by The Online Citizen
24/01/2023
28

...

August 2020
M T W T F S S
 12
3456789
10111213141516
17181920212223
24252627282930
31  
« Jul   Sep »

The Online Citizen is a regional online publication based in Taiwan and formerly Singapore’s longest-running independent online media platform.

Navigation

  • Editorial
  • Commentaries
  • Opinion
  • Politics
  • Community

Support

  • Contact Us
  • Letter submission
  • Membership subscription

Follow Us

  • Facebook
  • Twitter
  • YouTube
  • Instagram
  • Fact Checking Policy
  • Privacy Policy

© 2022 - 2023 The Online Citizen Asia

No Result
View All Result
  • Opinion
    • Editorial
    • Commentaries
    • Comments
  • Current Affairs
    • Malaysia
    • Indonesia
    • China
    • ASEAN
    • Asia
    • International
  • Finance
    • Economics
    • Labour
    • Property
    • Business
  • Community
    • Civil Society
    • Arts & Culture
    • Consumer Watch
    • NGO
  • Politics
    • Parliament
    • Transport
    • Education
    • Environment
    • Health
    • Housing
  • Law & Order
    • Legislation
    • Court Cases
  • Lifestyle
    • Travel
  • Subscribers login

© 2022 - 2023 The Online Citizen Asia

wpDiscuz