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Abe tasks new cabinet with promoting productivity, education

TOKYO — Newly re-elected Japanese Prime Minister Shinzo Abe said Wednesday he will use every policy lever at his disposal to beat deflation, including budgets and taxes, with a particular focus on boosting stagnant productivity and encouraging the development of talent. 

 

Abe reappointed his entire previous cabinet, which was just reshuffled in August, because “a results-oriented, job-first, meritocratic attitude is needed,” he told reporters. “We’ll push forward single-mindedly on policy and get results.”

 

The prime minister said the economy will remain his government’s top priority, centering on promoting “revolutions in productivity and human resources development.” Abe directed his cabinet at its first meeting Wednesday night to assemble a roughly 2 trillion yen ($17.5 billion) policy package toward this end by early December. He also asked for a supplementary budget for fiscal 2017 to enable quick government action.

 

The cornerstone of the policy package will be free early childhood education, to be paid for with part of revenue from an October 2019 consumption tax hike that was originally earmarked for debt reduction. The plan is to spend 700 billion yen to make schooling completely free for all children aged 3 to 5. Child care costs up to age 2 and tuition for higher education will also be fully covered for low-income households.

 

“We’ll overhaul the social security system into one for all generations that provides peace of mind for the old and the young,” Abe asserted.

 

The supplementary budget, meanwhile, will “provide robust support for investment in improving productivity at small and midsize enterprises,” he said.

 

The budget, expected to come in at around 2 trillion yen to 3 trillion yen, will provide for additional child care capacity as well as beef up the agriculture, forestry and fishery industries in response to a broad deal on an economic partnership agreement with the European Union. It will be drafted in conjunction with the fiscal 2018 budget and submitted at the start of the regular Diet session convening in January.

 

Asked about a successor for Bank of Japan Gov. Haruhiko Kuroda when his term ends in April, Abe said he has “a completely open mind.” The prime minister praised Kuroda’s skills, saying he was “able to create a deflation-free situation in a short period of time.” Abe also touted his track record on employment, which Abe called “the government’s most important responsibility.”

 

Abe indicated he will accelerate efforts toward revising the Japanese constitution’s war-renouncing Article 9 to explicitly recognize the Self-Defense Forces. The prime minister’s ruling Liberal Democratic Party “will consider a specific draft text in line with the basic thinking outlined in our campaign platform,” he said.

 

But Abe also said he would work to build a broad consensus encompassing ruling-party and opposition lawmakers, maintaining that “there’s no predetermined schedule.”

 

On the diplomatic front, the prime minister discussed Trump’s visit to Japan starting Sunday. “I’d like us to take time to discuss the various challenges facing the world,” including how to respond to tensions with North Korea, Abe said. The Japanese leader asserted that Pyongyang must be made to give up its nuclear and ballistic missile programs “in a complete and verifiable fashion.”

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