The government is still looking to revise the Bank of Japan Law to ensure the central bank keeps easing monetary policy and helps revive the country’s economy struggling under deflation, Prime Minister Shinzo Abe said Thursday.
Given the need for continued bold monetary easing, Abe said in an interview that he wants to keep his options open regarding the BOJ law.
The comment came despite the BOJ having vowed Tuesday to introduce a 2 percent inflation target and additional easing steps, as sought by the new Abe government, in a move experts expected to ease political pressure on the bank to some extent.
On Tuesday, the government and BOJ released a joint statement to accelerate their respective efforts to fight the nation’s chronic deflation, in what Abe called an “epoch-making” agreement, with which the bank agreed to purchase financial assets in potentially unlimited quantities until the year-on-year rate of growth in the consumer price index reaches 2 percent.
Abe also said his government will take the lead in efforts to scrap the crippled 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, Abe said at his office, adding it would be “impossible” for Tepco to alone decommission the plant’s reactors.
Abe underscored the crucial need to decommission the reactors “without further delay” to advance efforts to rebuild Fukushima Prefecture. The government and Tepco, as earlier reported, expect decommissioning work to take up to about 40 years.
Touching on the sensitive issue of Japan’s possible participation in the U.S.-led Trans-Pacific Partnership free-trade negotiations, Abe stopped short of offering a clear-cut commitment, indicating no decision will be made until the matter is reassessed.
“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, Abe said.
The issue remains a touchy subject, in large part due to opposition from the farming sector, which fears an influx of cheaper produce from overseas under abolished tariffs.
Regarding last week’s deadly hostage crisis in Algeria, Abe repeated that the government will consider amending the Self-Defense Forces Law to allow the SDF to engage in operations to rescue Japanese citizens involved in emergencies overseas.
Currently, the law only authorizes the SDF to transport Japanese nationals by sea or air when safety on the ground is assured.
On the economic front, Abe stressed the “need for flexible fiscal policies” to revitalize regional economies in a speedy manner and he intends to improve regional infrastructure and competitiveness.
Abe said spending to meet postquake reconstruction needs should be considered flexibly, noting funds for additional needs will be secured in the budget compilation process.