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‘Abenomics’ stifles debt cure: WEF

Kyodo

Japan ranks ninth in terms of global competitiveness, up one place from last year, thanks to the performance of its companies and research institutions, the World Economic Forum announced Wednesday.

In its Global Competitiveness Report 2013-2014, the WEF cited Japan’s national debt and budget deficit as two major macroeconomic weaknesses that prevented it from rising further up the rankings.

“It is unlikely that the coming year will see a reversal in these trends in light of the country’s aggressive monetary policy and various stimulus packages,” the report said, referring to Prime Minister Shinzo Abe’s economic policies dubbed “Abenomics.”

Abenomics’ first two pillars — fiscal stimulus and monetary easing — may have positive impacts in the short term but only structural reforms, the third pillar, have the potential to sustain these gains over the long run, said Thierry Geiger, associate director of the WEF’s Global Competitiveness and Benchmarking Network.

Switzerland ranked top for the fifth straight year, while Singapore and Finland remained in second and third place.

Among other Asian countries, South Korea dropped to 25th spot from 19th, while China was unchanged in 29th place. Myanmar appeared in the report for the first time, ranking 139th out of the 148 places.