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About ABENOMICS

In early 2013, after two decades of economic stagnation, Prime Minister Shinzo Abe unveiled a comprehensive economic policy package to sustainably revive the Japanese economy while maintaining fiscal discipline. This program became known as Abenomics. The centerpiece of Abenomics has been the three “policy arrows” targeted ataggressive monetary policy, flexible fiscal policy and growth strategy including structural reform. And now it is gaining speed. This page offers the latest on the reforms being implemented to reach a GDP of 600 trillion yen, including work style reform to raise productivity and increase the workforce in the midst of demographic changes.

Message

Sep. 21, 2016

Opening Remarks by Prime Minister Shinzo Abe at the Dialogue with the New York based Business and Financial Community of Japan  - Cabinet Secretariat

Three things, ladies and gentlemen. Continuity, that is point number 1. More openness, number 2. And changes in our work style, point number 3. Continuity, openness, work style changes. … Read more>

Progress

The centerpiece of Abenomics has been the three policy arrows targeted at aggressive monetary policy, flexible fiscal policy and growth strategy including structural reform. Since then, Abenomics has achieved remarkable progress.

Nominal GDP and growth rate2*2

Nominal GDP grew from 495 to 532 trillion yen*1 between the fiscal years of 2012 and 2015*2

Corporate ordinary profits*3

Annual corporate ordinary profits increased by 20 trillion yen between the fiscal years of 2012 and 2015*3

Jobs to applicants ratio and unemployment rate*4

Unemployment rate declined from 4.3% to 3.1% between 2012 and 2016*4

Dependency ratio on
Japanese Government Bonds*5

The level of dependency on government bonds has decreased 12% between 2012 and 2015

  1. Average exchange rate for March 2017: USD = JPY 113
  2. Source: Cabinet Office “National Accounts”; “Fiscal 2017 Economic Outlook and Basic Stance for Economic and Fiscal Management”; The Japanese fiscal year starts in April and concludes in March of the following year
  3. Source: Ministry of Finance “Financial Statements Statistics of Corporations by Industry” All industries, all (firm) sizes, Seasonally adjusted figures
  4. Source: Ministry of Health, Labour and Welfare “Statistics on Employment Referrals for General Workers” Seasonally adjusted figures; Ministry of Internal Affairs and
    Communications “Labor force survey”
  5. Source: Ministry of Finance ”Japan’s Fiscal Condition”

How it works

Engines that keep the positive economic cycle spinning.

Boost productivity by changing work style and diversifying the labor force to cope with the demographic change.
 
Leads to wage increase and employment, resulting in higher income and a rise in consumption

Implement structural reforms such as deregulation in the agricultural sector and other areas with growth potential, as well as expand international trade.
 
Leads to the creation of new demand and increased capital investment

Continue to create a business-friendly environment and promote inward FDI through robust corporate governance and further corporate tax reduction.
 
Leads to rise in corporate performance



TOPIC: THE FY2017 BUDGET

Opening the path to the future:

The budget to achieve economic growth while maintaining fiscal discipline was passed on March 27. The focuses for this fiscal year are:

FURTHER STIMULATING THE ECONOMY

  • Promote Industry 4.0 by encouraging private investment in R&D in science and technology*6
  • Promote inbound tourism
  1. Artificial intelligence (AI), robots, Internet of Things (IoT), automated driving and cybersecurity

CREATING A POSITIVE ECONOMIC CYCLE OF GROWTH AND RE-DISTRIBUTION

  • Increase disposable income by lowering the employment insurance premium by 0.2%*7
  • Expand childcare support by increasing the number of:
    • »childcare workers with improved labor conditions
    • »available childcare options
  • Extend the childcare leave benefit from 1.5 years to 2 years for those on the waiting list
  1. For three years

CREATING OPPORTUNITIES FOR CHILDREN

  • Provide higher education for students from challenging economic circumstances by:
    • »Introducing a grant-type scholarship with a base of 30,000 yen per month
    • »Eliminating virtually all academic requirements of interest-free scholarship loans for students from low-income families

REFORM WORK STYLE TO INCREASE PRODUCTIVITY

  • Encourage companies that are:
    • »Reforming their evaluation scheme
    • »Introducing equal pay for equal work
    • »Small and medium-sized enterprises (SMEs) introducing a minimum interval system for working hours

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