31 January 2013

Japan government launches review of banking law

The Tokyo government is to consider revising legislation governing the Bank of Japan in a bid to boost the country's struggling economy, Prime Minister Shinzo Abe revealed yesterday.

By James Barnes

Tokyo: deflation battle

In an interview with the Japan Times, Mr Abe said he is keeping his options open on the BoJ law. His comments come just days after the bank stated it would introduce a 2 per cent inflation target along with easing steps sought by the new government in a move experts claim will ease political pressure on the bank.

Fighting deflation

Earlier this week the government and the bank released a joint statement to increase their respective efforts to fight Japanese deflation, in what Mr Abe called an ‘epoch-making’ agreement. The deal will see the bank purchase financial assets in potentially unlimited quantities until the year-on-year rate of growth in the consumer price index reaches 2 per cent.
The prime minister also confirmed his government will step up efforts to scrap the reactors at Tokyo Electric Power Co’s Fukushima No 1 nuclear power plant, which suffered three core meltdowns.
‘The state will be at the forefront’ of such efforts, Mr Abe said, adding it would be ‘impossible’ for the power company alone to decommission the plant’s reactors.

Free trade deal

Mr Abe also spoke about Japan’s possible participation in the US-led trans-Pacific partnership free trade negotiations, but made no clear commitments.
‘I want to make the best decision to safeguard the national interests after considering the outcome of analyses by various ministries on the impact’ of the TPP on Japan,’ the newspaper reported Mr Abe as commenting.

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