- Akira Amari, Japan's Economy Minister
Stronger exports? Resilient domestic and external demand? What is the main driver of the economic recovery? According to Japan's Economy Minister Akira Amari, the central bank plays the main role in supporting the nation's recovery, by trying to achieve its 2% inflation target within the planned period. The minister claimed that due to the correctly chosen course of action, the government receives higher corporate tax revenues than it was originally anticipated. The main reason for such a tendency is the regained confidence and faster economic growth that has shown a substantial improvement in the labour market. Amid improving economy, policymakers are considering the prospects of a wage hike, the latest BoJ minutes showed. One of the members warned the momentum for increasing wages will wane soon.
While the economy is on the mend and policymakers are trying to assess the potential impact of the recent tax hike, external problems can become a massive drag on the world's third largest economy. Earlier this week, Shinzo Abe signed an agreement with NATO, as the Prime Minister is concerned about China's increased military spending as well as tensions with Beijing over islands in the East China Sea. At the time being, Abe draws a parallel between the current situation between Russia and Ukraine and a standoff between China and Japan over tiny uninhabited islands.
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