The Yomiuri ShimbunThe reshuffled fourth Cabinet of Prime Minister Shinzo Abe that launched on Wednesday includes a striking number of new economy-related ministers, though key economic policymaker Taro Aso has kept his post as finance minister.
With the consumption tax rate to increase from 8 percent to 10 percent in October, the government must take all possible measures to ensure that Japan’s economy does not stall.
Consumption tax concerns
Aso addressed the consumption tax rate hike at a press conference on Wednesday, saying, “We need to ensure that it takes effect smoothly, while paying attention to economic growth and business conditions.”
The government will consider additional economic measures if necessary to avoid a plunge in personal consumption like occurred following the previous tax increase in 2014.
New Economic Revitalization Minister Yasutoshi Nishimura will be responsible for both economic policy and strengthening the social security system.
“I will work to strengthen our capacity for economic growth,” he said at a press conference on Wednesday.
Japan-U.S. deal on horizon
Abe and U.S. President Donald Trump are expected to meet in the United States as early as this month to sign a new bilateral trade deal that was agreed to in principle in August. The Japanese government plans to submit a draft of the agreement to an extraordinary Diet session to be convened as early as early October.
Toshimitsu Motegi, who has been at the forefront of negotiations with the United States, will continue to work on final adjustments to the deal despite his new position as foreign minister.
“We intend to make every effort to sign the agreement and conclude a win-win deal for both Japan and the United States,” Motegi said at a press conference on Wednesday.
Under the new agreement, Japan will lower its tariffs on beef and pork to levels similar to those in the Trans-Pacific Partnership (TPP) deal, in response to U.S. demands that Japan open its agricultural markets. The Japanese government plans to draw up measures to support domestic farmers who are likely to be affected by an increase in agricultural imports from the United States.
Agriculture, Forestry and Fisheries Minister Taku Eto said at a press conference on Wednesday, “It is important to maintain a foundation for production and secure successors.”
Frigid S. Korea relations
There is no sign of an improvement in Japan-South Korea relations, which worsened following the implementation of stricter controls on Japanese exports to South Korea.
Economy, Trade and Industry Minister Isshu Sugawara, who served as state minister in the second Abe Cabinet, faces a major challenge.
“I would like to continue to firmly and calmly convey Japan’s position,” Sugawara said at a press conference on Wednesday night.