Challenges Remain After 7 Years Of Abenomics
Japanese Prime Minister Abe Shinzo pushed to revive the economy through his signature Abenomics policy. But challenges remain as he steps down after more than seven years for health reasons.
Abenomics tried to pull the economy out of deflation and achieve sustainable growth.
Under the policy, the Bank of Japan bought a large amount of government bonds to boost market liquidity. That helped weaken the yen, which supported exports.
Under Abe's watch, the benchmark Nikkei 225 share index recovered to the 20,000-mark from under 10,000 before he took office in 2012. Abenomics also helped buoy the job market.
And the prime minister's push for free trade helped the Trans-Pacific Partnership pact take effect.
But, despite all that, Japan's economy has shown only limited growth.
This year, the coronavirus pandemic has cast a long shadow. The economy shrank an annualized 27.8 percent in the April-June quarter, its largest contraction since 1980.
Meanwhile, government debt has snowballed. Despite two hikes in consumption tax, central and local governments are expected to owe a total of around 1,100 trillion yen, or about 11 trillion dollars, at the end of the fiscal year. That is more than double the nation's GDP.
