Shirakawa exits after ‘turbulent’ BOJ term

by Jun Hongo

Staff Writer

Departing Bank of Japan Gov. Masaaki Shirakawa expressed regret Tuesday for not being able to end a decades-long struggle with deflation during his “turbulent” five years in office, but added that he believes a recovery is possible.

Speaking on his last day as the central bank chief, Shirakawa appeared at the Diet to speak at a Lower House committee meeting.

“With the easing of the yen and the rising of stock prices, I believe a chance is here,” he said.

Shirakawa is set to be replaced by former Asian Development Bank head Haruhiko Kuroda, whose nomination as BOJ chief was approved by both chambers of the Diet last week.

Kuroda, a former Finance Ministry official whose position on monetary policy is close to that of Prime Minister Shinzo Abe, is likely to usher in changes to the central bank with an aggressive easing program. Kuroda is scheduled to hold his inaugural news conference Thursday.

“I hope this opportunity will be seized and that fundamental issues of our economy can be solved,” Shirakawa said of his hopes for Kuroda at a news conference later in the day.

Shirakawa was named BOJ governor in March 2008 after the Diet rejected two other nominees. He had served as deputy governor before taking the top slot.

In addition to the task of leading Japan’s decades-long battle with deflation, Shirakawa also had to manage the country’s monetary policies in the wake of the 2008 Lehman shock, Europe’s sovereign debt crisis and the impact of the March 2011 disasters on the domestic economy. Shirakawa also witnessed a revolving door of prime ministers during his term.

Asked to reflect on his five years on the job, Shirakawa said “turbulent” would be the best description of his time in office.

Still, he expressed confidence that the domestic economy remained relatively stable compared to others in the wake of the global financial crisis, and that the BOJ was able to work effectively after the 2011 disasters.

Shirakawa said it was too early to grade his time as BOJ chief and that such an evaluation should be left to a third party.