Business circles hope for fiscal reform after reshuffle

Kyodo

Business leaders are expressing hope progress will be made in fiscal reform, centering on raising the consumption tax, after Prime Minister Yoshihiko Noda reshuffled his Cabinet.

The reshuffle “is aimed at boosting preparations to swiftly move the policy forward,” Keidanren Chairman Hiromasa Yonekura said in a statement.

Yasuchika Hasegawa, chairman of the Japan Association of Corporate Executives, also welcomed the political move, calling it “a bold decision, which was a necessary step to pass legislation,” including the bill that would eventually double the 5 percent consumption tax.

Tadashi Okamura, chairman of the Japan Chamber of Commerce and Industry, called on opposition parties, including the Liberal Democratic Party, to swiftly start discussions on the related bills with the ruling Democratic Party of Japan.

In an interview with media organizations, Yonekura hailed Noda, describing him as “a rare prime minister who develops policies by looking to the future of Japan.”

“Though the speed may be slow, he has never stopped nor swayed,” the head of Japan’s biggest business lobby added, dismissing criticism that Noda can’t make decisions.

On the strengthening yen, which has become a major factor weighing on Japan’s equities market, Yonekura indicated that he will urge the government and the Bank of Japan to take steps, including unilateral intervention, to stem any further appreciation.

In addition to the yen’s rise, he expressed caution about prospects for the global economy, saying that “the risk of global recession has been increasing considerably.”

Yonekura called the currency’s appreciation “excessive,” saying it has risen to levels that people running the economy can’t tolerate.

“We would like the government and the BOJ to implement monetary easing measures and conduct unilateral intervention at the same time when the opportunity arises,” he said.