The government, in its upcoming basic economic and fiscal policy guidelines, will position China as the biggest strategic challenge to efforts to strengthen the international order based on the rule of law, sources said Wednesday.
It is unusual for the annual economic and fiscal policy guidelines to criticize China for its coercive behavior toward neighboring countries.
A draft of the guidelines points out that China is using economic coercion, including through trade, and that the spread of yuan-based settlements through its Belt and Road initiative could impact the role of the dollar.
The draft also expresses strong concern about China's attempts to unilaterally change the status quo by force in the East China Sea and the South China Sea, as well as its actions against peace and stability in the Taiwan Strait.
Regarding U.S. President Donald Trump's tariffs, the draft states that the government will patiently continue negotiations to urge the Trump administration to reconsider the tariffs.
The draft calls for all possible measures to cope with the tariffs' impact on the Japanese economy.
In response to growing calls for a consumption tax cut, the draft indicates that the government will pursue wage increases that outpace inflation by expanding the overall economy, rather than increasing people's take-home pay through a tax cut that lacks a funding measure.
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