Improving people’s well-being priority for Japan-official
2022.12.28 00:53
Improving people’s well-being priority for Japan-official
Budrigannews.com – According to Deputy Chief Cabinet Secretary Seiji Kihara’s statement on Wednesday, the Japanese government will make wage increases a top priority in its economic policy in the coming year.
“The absence of wage growth is the greatest obstacle facing Japan’s economy. “Consumption will not pick up, and businesses will not increase investment,” Kihara stated during a television program.
According to Kihara, the government can assist in achieving higher wages through tax incentives, but it is up to businesses to decide how much to raise pay. He said that the government can also get businesses to disclose more information about how much they spend on human resources.
The remarks are in line with those of Bank of Japan (BOJ) Governor Haruhiko Kuroda, who has emphasized that raising wages is necessary for the economy to sustainably achieve its 2% inflation target due to strong domestic demand.
“The government will concentrate more on increasing wages. Because prices are rising, this is especially important,” Kihara stated.
Concerns about the rising cost of living have contributed to a decline in approval ratings for the government of Prime Minister Fumio Kishida. This is because recent sharp falls in the yen have increased the cost of importing raw materials, which are already expensive.
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According to sources who spoke with Reuters, the BOJ’s surprise decision earlier this month to modify its bond yield control and allow long-term interest rates to rise more was partly driven by the government’s concern about yen-weakening side effects of its economic stimulus policy.
In November, Japan’s consumer inflation reached a four-decade high of 3.7%, well above the BOJ’s target. This hit households whose wages haven’t increased enough to cover the rise in consumer goods prices.
