Former Prime Minister Shinzo Abe on Sunday called on the current leader to commit to the Abenomics policy mix pursued during his time in office to satisfy wishes of financial markets.
Abe said on a TV program that financial markets are not looking for a fundamental change in economic strategy from the government of Prime Minister Fumio Kishida, rather they want a continuation of the big-spending, growth-seeking program maintained throughout the term of Abe’s successor Yoshihide Suga.
Kishida has vowed to bring a “new capitalism” to the country in hopes of promoting growth through a pathway of wealth redistribution, among other central steps, aimed at expanding the country’s middle class.
“Markets could react negatively if they take (the new capitalism policy) as being socialist,” Abe said during the TV program. “We shouldn’t be viewed as moving our focus from growth.”
Despite presenting a new direction, Kishida, like Abe and Suga, remains committed to drastic monetary easing and fiscal spending in hopes of rejuvenating the domestic economy.
Some economists have observed Kishida appears to wish to address criticism that the previous economic policy mix boosted corporate earnings and thus stock prices but not the middle class.
After Kishida became the leader of the ruling Liberal Democratic Party in late September, the benchmark Nikkei stock index slumped some 9%, partly as investors struggled to understand how Japan can create growth while also carrying out systemic wealth redistribution.
Still, Abe said the LDP’s victory in the Lower House election in October under the leadership of Kishida did restore political stability.
The former premier said he hopes Kishida will continue to demonstrate leadership in addressing the pandemic, among other issues, and help the party perform well in the Upper House election next year.
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