Will "Abenomics" succeed? Prime Minister Shinzo Abe, claiming economic success, says "numbers do not lie." But one number does give lie to his claim: Before Abenomics, gross national product per head in Japan stood at $46,000.
Today, thanks to a 30 percent depreciation of the yen, that figure is now around $37,000 per head — the level of Italy and Hong Kong. "Japan is Back," Abe likes to tell the world. Well, in one sense it really is back — all the way back to the per capita income of the early '90s.
The recovery we see now is almost entirely due to that massive 30 percent depreciation, which in turn is the result mainly of the large annual ¥3 trillion increase in imports of fossil fuels caused by the Fukushima nuclear disaster. That currency depreciation, in turn, gives the support to exporters, and to domestic producers competing with imports, that sustains the present recovery — which in turn gives the psychological boost this economy needed so badly.