TOKYO — Prime Minister Shinzo Abe outlined the next steps of his grand plan for restoring Japan's economic power in a news conference Friday, naming a slew of initiatives he said would help awaken the country's "sleeping opportunities."
Japan's future growth will depend on further opening the economy and tapping the underutilized potential of its women and advanced technology, Abe told reporters Friday as he reviewed his achievements since taking office in late December.
Although economic data so far are mixed, Abe has been keen to claim success in turning the economy around after pushing for a drastic easing of monetary policy aimed at vanquishing chronic deflation, and hiking public spending to stimulate demand.
"Comparing now with four months ago, isn't the atmosphere much brighter?" he said.
Ending the "high yen" era by weakening the Japanese yen's value against the U.S. dollar and other major currencies is another main tenet of the prime minister's "Abenomics" platform. The aim is to make Japanese exports more competitive in global markets, though it has also raised costs for manufacturers who rely on imported energy and commodities.
So far, criticism of that strategy has been muted, though U.S. Treasury Secretary Jacob Lew said Wednesday before Group of 20 talks in Washington that he would keep pressure on Japan and China not to lower the value of their currencies to boost their exports at the expense of the U.S. and other trading partners.
Newly installed Bank of Japan Gov. Haruhiko Kuroda's program for ending deflation is a "monetary bazooka," Japanese Finance Minister Taro Aso wrote in a commentary in Thursday's edition of the Financial Times that stressed the challenges facing Japan after two decades of stagnation.
The yen has lost over 20 percent of its value versus the U.S. dollar since October. It weakened further after Japanese media reported Friday in Tokyo that Aso said his G-20 counterparts had avoided criticism over its depreciation. It was trading at about 99.15 to the U.S. dollar late Friday in Tokyo.
Following the early progress on the policy front, "This momentum must now be turned into a recovery," Aso said in his commentary. "Finding our hidden strength and changing our mindset is needed for Japan to regain true competitiveness," he said.
Abe has made politically difficult reforms aimed at improving Japan's waning competitiveness the third and final part of his economic strategy.
"Regarding various `sleeping opportunities,' ... sectors that have low productivity need to shift their resources to sectors that have high productivity. Growth requires nothing other than realizing such changes," Abe said.
Among the initiatives he sketched out Friday were plans for a government-backed national institute of health to help support medical research, a proposal to extend parental leave by up to three years, and trial employment programs to encourage more hiring.
Excessively long working hours and a shortage of places at childcare facilities discourage women from staying in the workforce once they become mothers – a luxury Abe says Japan, with its aging and shrinking population, cannot afford.
"The reality is harsh," Abe said. "For most women it is a choice between either having a children or a career."
Abe also pledged to conduct vigorous "economic diplomacy," with upcoming visits to Russia and the Middle East.
Japan and Russia are moving toward more active economic cooperation after decades of chill over a still-unresolved territorial dispute, driven by the complementarity of their economies. Russia has abundant gas and other resources that Japan needs, while Japan is keen to sell its technology and manufacturing prowess to the burgeoning Russian consumer market.