The.. erosion of the effect of “Abenomics” these measures to revive the Japanese economy after years of deflation, initiated by Prime Minister Shinzo Abe since late 2012, is confirmed. As several indicators, published Friday, December 26, Japan ended 2014 on a negative note. With the horizon for Mr. Abe, newly elected Prime Minister, after the victory of his party, the Liberal Democratic Party (LDP, right) in early parliamentary December 14, the risk of a prolonged recession.
- Inflation still slows: in November for the fourth consecutive month, rising prices has settled. It is located outside perishable products, up 2.7% year on year, against 2.9% in October, announced Friday, December 26, the Ministry of Internal Affairs. However, excluding the impact of the rise in early April, the consumption tax (the equivalent of the VA), which inflates the inflation of around two points, price growth is 0, only 7%, according to the calculation method proposed by the Bank of Japan (BoJ) is still far from its target of 2%. Japan had not experienced such a low inflation since September 2013. And the decline in oil prices is expected to help curb rising prices.
- consumption folds again: Japanese household spending, which had already declined 4% in October fell 2.5% in November year on year. The effect of the VAT hike continues to be felt. Especially as household incomes, themselves, are down
- Industrial production declined. industry reduced production in November 0.6%. This is the first decline in three months. This figure is well below economists’ expectations (+ 0.8%). These nevertheless provide a rebound in December and January.
For several months now that the “Abenomics” slipping and doubts are increasing about the effectiveness of this massive stimulus policy . In the third quarter, Japan entered recession, with gross domestic product (GDP) fell by 0.5% from the previous quarter, a year on year fall of 1.9%.
GDP had declined by 7.3% yoy between April and June. This sudden stopping of the Japanese economy has forced the government to postpone his plans for a second increase of VAT
Read also:. The lessons of “Abenomics”
In an attempt to restart the machine, Abe is expected to announce on Saturday a new law stimulus package 3,500 billion yen (€ 24 billion). With a goal. Give a boost to consumption
The companies invited to “share the cake”
Just re-elected Abe d Moreover urged business leaders to give purchasing power, both by increasing wages in the upcoming spring negotiations, and better paying their subcontractors.
Thursday, December 25, the Governor of the Central Bank of Japan (BoJ), Haruhiko Kuroda has also put employers under pressure. Speaking before members of Keidanren business federation, large companies, widely beneficiaries of the depreciation of the yen, he urged them to change “attitude” , “share the cake” and reinvest profits “that the virtuous circle of the economy settles firmly” .
“At this stage, the cake is unevenly split in favor of big firms and holders of financial assets. If economic entities which have a large share of the cake tend to spend little, the next cycle will not will trigger “, assured Mr. Kuroda.
According to data released last week by the BoJ, companies have never had money as well filled mattress.
However, the Japanese management sector remains cautious against the “Abenomics”. Many employers expect the implementation of the “third arrow”, that structural reforms. Labour market reform and agriculture, decline in corporate tax
“The Abenomics are at a crossroads. Their success depends on the third arrow and drastic measures to reform the systems that impede growth, “ showed to the World , there a few weeks Yasuchika Hasegawa, President of the Keizai Doyukai, one of the employers’ organizations of the Archipelago, and CEO of Takeda Pharmaceuticals, a number of the pharmacy in Japan. He called on the government to “implement fundamental reforms to enhance productivity” and everything to “replace the old with the new in the industry” .
Read also: The Japanese employers split over recovery
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