National / Politics

Abe expresses concern over Brexit-related currency fluctuations at election debate

by Reiji Yoshida

Staff Writer

Prime Minister Shinzo Abe said Friday Japan will take “every measure” to ensure stability in global financial markets following Britain’s vote to exit from the European Union.

Abe made the comments in a TV debate where he faced off against the leaders of seven other major parties taking part in the July 10 Upper House election. The prime minister noted he was paying close attention to currency fluctuations following the Brexit vote.

“British citizens have made a decision to leave the European Union. I’m concerned over risks on currencies and financial markets,” Abe said

Japan, as this year’s chair of the Group of Seven advanced nations, will “send out clear messages” to help maintain stability in the markets, Abe said.

Meanwhile Katsuya Okada, the president of the Democratic Party, was quick to point out that the yen’s value against other currencies has already surged because of anxiety over the European economy.

The yen’s sharp rise underlines the limit of the prime minister’s economic policies, known as Abenomics, Okada said during the debate.

“Now the yen’s appreciation is expected to continue. The party is over,” Okada added.

Abenomics has relied heavily on ultraloose monetary policy from the Bank of Japan, which is believed to have helped pushed down the yen against other major currencies to increase profits for export-reliant Japanese companies over the past three years.

During the debate Friday, Japanese Communist Party chairman Kazuo Shii maintained Abenomics is a “failure,” pointing out that wages in real terms — or nominal wages adjusted for inflation and deflation — have continually decreased over the past five years. “Abenomics is not working, and (the data) shows it,” he said.

Consumer spending, which accounts for about 60 percent of the nation’s gross domestic product, shrank in 2014 and 2015, the first consecutive two-year decline during the postwar era.

Critics argue Abe is trying to divert voter attention away from his attempts to revise the nation’s pacifist Constitution by focusing on economic issues.

Abe has said the major parties have yet to form a consensus on exactly which of the articles in the Constitution should be revised, and thus it cannot be a focus of policy debate for the Upper House election.

Abe also argued it is a national referendum, not an election, that will decide which articles should or should not be revised.

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