Latest measures to boost Japan growth met with scepticism
JAPANESE Prime Minister Shinzo Abe pledged yesterday to raise incomes by 3pc annually and set up special economic zones to attract foreign businesses in his third tranche of measures aimed at boosting growth in the world's third-biggest economy.
Mr Abe, pictured, is also considering a push for public pensions and other public funds – a pool of $2 trillion – to increase returns by raising investment in equities, a government draft growth strategy showed.
The government will seek the view of experts and aim to reach a conclusion by autumn, the draft said. Still, such a move could face opposition from Japan's risk-averse voters.
The steps are the last batch of proposals in a growth strategy that includes measures to mobilise women in the workforce, boost private investment and deregulate some sectors.
The package is set to be approved by the cabinet on June 14 along with macro-economic policy guidelines including fiscal reform targets to address Japan's massive public debt.
However, some analysts were sceptical the strategy would achieve the goals of the prime minister's "Abenomics" policy given a lack of bold steps, such as changes to promote labour market flexibility and make it easier for companies to exit dying businesses while shifting to growth areas.
Tokyo share prices fell 3.8pc on the day, partly on disappointment over Abe's speech.
"The government has come up with rosy numerical targets but I doubt any of these could be met or that such a targeting policy could work out as planned," said Hideo Kumano, chief economist at Dai-ichi Life Research Institute. (Reuters)