Japanese Rebound Hopes May Have Been Premature

by Mary Swire, Tax-News.com, Hong Kong

30 May 2002

Speaking to a parliamentary committee earlier this week, Japanese Finance Minister Masajuro Shiokawa announced that the government hopes to compile a report on its economic revitalisation plans by mid-June.

'Before the Prime Minister heads for the summit, by around June 20, I hope we can compile something like a second anti-deflation package,' Mr Shiokawa revealed.

The Japanese government compiled a set of measures designed to rescue the ailing economy in February, and is currently discussing tax reforms and deregulation strategies to help cutting-edge industries. However, there have been calls for further steps to combat deflation.

Meanwhile, there are fears that despite a tentative export led recovery this year following three consecutive quarters of contraction, suggestions that the country's economy is rebounding may have been somewhat premature.

A report in the South China Morning Post on Wednesday predicted that: 'first quarter growth is likely to be weak despite bullish market expectations, and the government may reassess its view that the economic slump has stopped', following the Finance Minister's admission that the result of January to March gross domestic product is likely to be 'tough'.

http://www.reuters.com/news_article.jhtml?type=search&StoryID=1021809 http://biz.scmp.com/bizasiaworld/ZZZ0CBKAO1D.html

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