The central government plans to extend the state of emergency covering Tokyo and other regions struggling to contain coronavirus outbreaks by one month until March 7, an official with knowledge of the situation said Monday.
Prime Minister Yoshihide Suga said he will make a final decision on the extension after hearing from an expert panel on Tuesday.
“Coronavirus cases are declining, but we must remain vigilant for a while longer,” he told reporters after meeting with members of his Cabinet, including Yasutoshi Nishimura, minister in charge of the nation’s COVID-19 response, and health minister Norihisa Tamura.
According to the official, who spoke on condition of anonymity, Tokyo and neighboring Kanagawa, Chiba and Saitama prefectures will remain under the state of emergency, as will Aichi, Gifu, Osaka, Kyoto, Hyogo and Fukuoka.
Tochigi Prefecture, lying to the north of Tokyo, will be removed because its coronavirus situation has significantly improved. Okinawa Prefecture, which was under consideration to be added due to outbreaks on remote islands, will be left off the list, the official said.
The emergency has helped halt a rapid acceleration of virus cases, which hit records in early January and raised worries of ripping through the developed world’s oldest population. While infection numbers have dropped since then, the Suga government has said they are still worryingly high.
“Looking at the situation from region to region, the number of infections is still high and the medical system continues to be strained,” said Shigeru Omi, the doctor chairing the government’s coronavirus subcommittee.
Nishimura said if the decision is made to extend the state of emergency, prefectures that see their situation improve before the new end date could be taken off the list early.
“Considering the impact on the economy, on businesses, we are looking to keep the measures to a minimum,” he said during a committee meeting in the House of Representatives.
Support for the Suga administration has weakened over unhappiness with its handling of the coronavirus pandemic, which critics have called too slow and inconsistent.
A Nikkei newspaper poll showed 90% of respondents favored extending the emergency period in areas where it is implemented.
Japan has had a total of 390,687 coronavirus cases and 5,766 deaths as of Monday morning, public broadcaster NHK said.
Japan’s current measures, which include urging people to work from home, are far less stringent and enforceable than the lockdowns of some European nations. But they have already caused a sea change, in the view of economists. Instead of the year starting with a slowing recovery, some of them now see a double-digit contraction looming.
“The damage to businesses would be enormous,” said sushi restaurant owner Mamoru Sugiyama, referring to an extension. Bars and eateries are among the firms hardest hit by the guidelines. He has temporarily closed his restaurant, which boasts a history of 130 years in the swanky Tokyo shopping district of Ginza.
“Some businesses are about to use up their loans and I think if the emergency continues through February, firms may start going bust one after another, even in Ginza,” said Sugiyama, who also heads a coalition of about 370 local restaurants and bars.
The government has said the emergency can end when the virus crisis eases to Stage 3 on a four-stage scale that draws on six data points.
In Tokyo, that would mean daily infections falling below 500. Tokyo reported 393 new infections on Monday, well below the recent peak of 2,447 on Jan. 7. As of Wednesday, the capital’s hospital bed occupancy rate was 73% and critical care units were at 113% of capacity, according to the health ministry. Both numbers would have to come down below 50% to reach Stage 3.
“We can see that the state of emergency has had an impact, but it’s been too weak,” said Yoshihito Niki, a professor of clinical infectious diseases at Showa University’s School of Medicine in Tokyo, indicating a need to prolong the measures. “The government will need to exercise patience at least through February.”
Since the declaration of the emergency in early January, economists have warned that the less stringent advisories compared with the first emergency in April risked being insufficient and causing more damage over time. This time, schools remain open and streets continue to see foot traffic, albeit smaller than during normal times, despite repeated calls from officials to stay home.
Toshihiro Nagahama, economist at Dai-Ichi Life Research Institute, sees an emergency extended to two months shaving about ¥3 trillion from the economy.
While the consensus among analysts is for the economy to shrink an annualized 2.5% this quarter, economists Yoshimasa Maruyama and Koya Miyamae at SMBC Nikko Securities Inc. now see a stronger finish to 2020 whiplashing into an 11.5% contraction in the three months through March.
Still, an unemployment rate of just 2.9% and year-on-year falls in the number of bankruptcies show that spending and loan support from the government and the Bank of Japan have helped cushion the economic blow of the pandemic so far. Suga’s administration got a third extra budget through the Diet last week offering another round of help for businesses, medical facilities and the economy.
The concern going ahead is how much longer companies can hang on if the emergency is extended and consumer spending remains subdued.
Yasuhide Yajima, chief economist at NLI Research Institute, warns there won’t be a dramatic revival of growth even when the emergency ends unless there’s more concrete reassurance for the public.
“Regardless of the state of emergency, consumption isn’t going to come back until we see the impact of vaccinations,” Yajima said.
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