By Ito Hiroki
At a press conference on Nov. 2, Japan Association of Corporate Executives (Keizai Doyukai) Representative Sakurada Kengo commented on the “new form of capitalism” advocated by the government led by Prime Minister Kishida Fumio. “A traditional growth strategy will get Japan nowhere. I hope Prime Minister Kishida’s new strategy is not a rehash of the existing one,” said Sakurada, who is also president of Sompo Holdings. He also sounded a warning about hasty discussion and said the government “can spend six months or so (for discussions)” to cement the framework of its economic policies.
In October, the Kishida government held the first meeting of the “council for the realization of a new form of capitalism,” which will consider how to achieve a virtuous cycle of growth and wealth distribution. Prime Minister Kishida instructed the panel to compile a set of emergency proposals in early November. Sakurada is a member of the council.
In the set of proposals to the government titled “requests to the new government” released on Nov. 2, Keizai Doyukai pointed out that it is a well-known fact that government-led growth strategies have failed to enhance the Japanese economy over the past three decades. Sakurada said during the press conference: “Companies have vested interests. Nothing will change unless the knife (of reform) is inserted into vested interests.” Giving the example of blanket recruitment of new graduates, he called for the need to review practices and systems advantageous for companies and said corporations should urge the government to achieve economic growth and social reform.
On the other hand, Sakurada said fortifying the taxation of financial income, which was advocated by Kishida at one point during Liberal Democratic Party (LDP) presidential campaign, would contribute in only a limited way to increasing tax revenues. “I have to say it would be extremely disappointing if that is what Kishida says a new form of capitalism,” commented Sakurada.