GENEVA – The World Trade Organization is calling on Japan to make bold structural reforms while offering broad support for its current money-easing policies.
“Members felt that the accommodative macroeconomic policies being pursued, particularly by the new government, can help Japan to recover from the recent economic downturn, but that they need to be accompanied by far-reaching structural reforms,” the chairman of a biennial WTO review said.
The policies, pushed by Prime Minister Shinzo Abe, constitute the core parts of “Abenomics,” a set of policy measures aimed at overcoming persistent deflation.
In the review, Japan was urged to address its high tariffs on agricultural products, a delay in the liberalization of the services sector and nontariff barriers in government procurements, sources said.
Meanwhile, South Korea and China expressed concerns about the yen’s recent rapid falls on the back of strengthened monetary easing by the Bank of Japan.
It was the first WTO review of Japan since the March 2011 earthquake and tsunami and subsequent nuclear crisis.
Delegates from other countries praised Japan for refraining from protectionist measures, such as import restrictions, even though its economy took a heavy blow due to the disasters.
They pointed out that the Abe administration’s efforts to draw up a new economic growth strategy as part of Abenomics are in the right direction and that free trade will push up Japan’s growth, according to a Japanese official.