With the government scheduled to finish economic projections for fiscal 1999 on Sunday, Economic Planning Agency chief Taichi Sakaiya and trade chief Kaoru Yosano had a rare last-minute meeting on Friday to narrow their perception gap on prospective growth rates.
But the two ministers failed to reach a consensus at the meeting, according to an official at the Ministry of International Trade and Industry.
During the meeting, Sakaiya reiterated his position that the government needs to stick to a "realistic figure" of 0.5 percent growth for fiscal 1999, while Yosano demanded that the government forecast 1 percent growth for the sake of its policy objectives.
Sakaiya argued that the nation can surely achieve 0.5 percent economic growth during fiscal 1999, considering the extent of the 9.3 trillion yen in tax cuts planned for the next fiscal year.
There remains a difference of opinion between the EPA and MITI over how much the planned tax reductions will help boost domestic consumption, the MITI official said. He added that the two sides will continue to exchange opinions on the issue, but may leave the final decision to Prime Minister Keizo Obuchi.
This year, the government has been forced to drastically revise its economic forecast from 1.9 percent growth to a 1.8 percent shrinkage of the economy.
At an earlier press conference at the Foreign Correspondents' Club of Japan, Yosano said that the government should be able to put the economy back on track for 2 percent growth within two years with the help of the emergency economic package and substantial tax cut measures.