Japan's economic recovery and political turmoil

Japan's economic recovery and political turmoil

The article summarizes about the Fukushima nuclear disaster forcefully raised issues of safety, energy policy, public utility company behavior, and government regulation and policy making. While its energy conservation and initial recovery were impressive, Japan is yet to fully confront some key questions: should additional existing nuclear plants be reopened to overcome potential power shortfalls and to reduce costs? Will power companies eventually be allowed to reopen and operate most nuclear plants until they reach their normal 40-year lifetime? s ten electric power companies insolvent. Inadequate domestic demand, huge government budget deficits, immense government debt as a share of GDP, small but persistent deflation, unemployment and underemployment of young Japanese, and an uncompetitive agriculture sector - all these issues must be addressed in the medium to long term. First, on 14 February 2012, the Bank of Japan announced it was setting a goal (if not an explicit target) of a 1 per cent annual increase in the CPI, which would bring deflation to an end. Second, Prime Minister Noda has indicated that Japan will join the Trans-Pacific Partnership (TPP) negotiations.  Joining the TPP will force Japan to carry out much-needed structural and institutional deregulation and liberalisation, but it is far from a sure thing. s political resistance has been the stumbling block for years, preventing Japan from embarking on any significant trade liberalisation agreements. Third, Prime Minister Noda made fiscal consolidation his top priority. supper house passed legislation increasing the consumption tax, which is currently 5 per cent to 8 per cent in October 2014 and to 10 per cent in April 2015.

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