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Persistence Pays Off

Many critics claim that Prime Minister Abe has failed in the promises of his third arrow under Abenomics. But once again he relentlessly moved into his third year of office with the samepolicy statement to the Diet stating: “…what is demanded of us in the current Diet is to push through reforms”. Last month, Minister of Finance Taro Aso officially promised the following in hisstatement to the House of Councillors: reform of taxation and abolition of bedrock regulations, support for child care, reduction of income taxes and other actions that have all been part of Abe’s strategy for Revitalization of the Japanese Economy. There are no changes in these messages since Abe came back into office more than two years ago.Indeed, some of the results of the first two arrows are astonishing. The rise in the Nikkei average to a level not seen in 20 years, and the Yen / Dollar rate dropping to 120 from 80 has everyone’s attention. But the critics note that the tough challenge of “reform” is yet to be realized.

Nevertheless, some have said “energy and persistence conquers all things.” Abe seems to have energy, and he is persistent!There are many reforms that were initially announced by the government including areas of free trade, corporate taxation, deregulation in labor markets, healthcare and agriculture sectors, childcare facilities, women in the labor markets. We understand that each of these initiatives are still part of the government’s stated agenda. All of them are controversial. None of them are easy. Abe and his Cabinet continue to talk about them and many are under active negotiation.

Japan and Abenomics continue to grasp the world’s attention, unlike the prior 20 years of international indifference. Our markets are viewed with great interest by global investors as shown by investment activity. The government looks strong by recent opinion polls and elections. We have hope. This strength and persistence can bring the change we are eagerly waiting for. Ganbaro!

Under the direction of Governor Yoichi Masuzoe, the Tokyo Metropolitan Government established the “Tokyo Global Financial Center Initiative”. See the Governor’s interview in the May 2015 edition of the newsletter for discussion of his plan to help make Tokyo into a financial center.


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