Full speed ahead for Abenomics, vows Japan's PM

Full speed ahead for Abenomics, vows Japan's PM

JAPAN - Prime Minister Shinzo Abe has vowed to pursue reforms to turn Japan into a haven for doing business, as part of his bid to spur economic growth through deregulation and competition.

He made the pledge on Tuesday at the opening of a 53-day session of Parliament that will see the Japanese leader aiming to pass Bills to flesh out his so-called "Abenomics" blueprint to fight 15 years of deflation and promote growth.

With Tokyo's hosting of the 2020 Olympics giving a major boost to investments, especially in the capital area, Mr Abe pledged to cut red tape in specially deregulated zones to promote business activity.

"We will thoroughly remove peculiar regulations and systems and create the world's most advanced business city," he said. "We aim to make Japan the easiest place in the world for companies to do business."

He had unveiled his economic growth strategies as the "third arrow" of his Abenomics policies in June but had yet to flesh them out. The first two arrows concerned easy monetary policy and public spending.

In a speech delivered with confidence, Mr Abe vowed to push ahead with his policies in the light of two successive quarters showing over 3 per cent growth and improved job figures.

But experts have warned that his Abenomics formula to end deflation will not succeed if wages do not rise, particularly as the sales tax will go up to 8 per cent next April from 5 per cent now.

On Tuesday, Mr Abe failed to make any mention of his earlier proposal to reduce corporate taxes to encourage Japanese firms to raise wages and also to attract foreign companies to set up shop here, or of labour reforms to ease the country's rigid job market.

Besides Bills related to the economy, he is also seeking to pass laws to protect official secrets and to create a ministerial council, modelled on the National Security Council in the United States, to streamline decision-making in foreign affairs and national security.

He also hinted he was moving towards amending the country's pacifist Constitution, in particular a key article that renounces war as a sovereign right and limits Japan's military to self-defence.

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