'Abenomics' is paying dividends
Three-pronged economic strategy helps to reinvigorate the economy, writes Julian Ryall
After a less-than-successful stint as prime minister for exactly one year in September 2006, Shinzo Abe has surprised many people in his second stab at the job. He has been resolute, decisive and some of the policies he has introduced have been sweeping and long overdue.
Nowhere has that been more evident than in efforts to reinvigorate the national economy. When Abe was voted into office in December 2012, the yen was far too strong, exports were suffering, investment was stagnant, consumption was flat and a decade spent trying to get the nation out of inflation had come to nothing.
In a little over 18 months, the transformation has been dramatic. No sooner than he had taken office than Abe laid out a three-pronged strategy - known as "Abenomics" - built on the connected pillars of fiscal stimulus, monetary easing and structural reforms to deal with the deeper problems that bedevil an economy that has been in recession or, at best, anemically positive, since the start of the 1990s.
Seven months after his election victory, Abe set off for his first G8 summit in Northern Ireland buoyed by a gross domestic product that climbed at an annualised rate of 4.1 per cent in the January-March 2013 quarter, while the stock market had fattened by 50 per cent since the previous November.
The value of financial assets held by Japanese households leapt more than 3 per cent in the final quarter of fiscal 2012, and the yen recovered from a low of 76 yen (HK$5.8) to the dollar in February 2012 to above 100 yen in April last year.
Not everything that the prime minister touched turned to gold, however, with some detractors suggesting that his policies were thin on details of how precisely he planned to turn around the economy in the long term.
