The national savings rate dropped to as low as 2.8 percent in 2004, according to a report released by the Cabinet Office last month. This is incredibly low, given the figure had been above 10 percent until as recently as 1999.
When Japan's huge trade surplus was a politically sensitive issue, the frequent criticism from abroad was that the Japanese were saving too much and should be trying to spend more and import more instead.
The savings figure tells us how much of a person's disposable income (after taxes are deducted) is being put aside for the future. Naturally, things like falling income, rising tax and social security burdens and expanding consumption will push down the savings ratio.