Prime Minister Vows to Open Japanese Markets, Spend More

Prime Minister Noboru Takeshita vowed Friday to shift Japan’s economic emphasis from exports to consumption and to open up its domestic markets in efforts to help quell growing foreign discontent over the nation’s large trade surpluses.

In his first speech as prime minister, Takeshita also told the Diet, Japan’s parliament, that Japan would adhere to international accords aimed at currency stabilization.

Takeshita succeeded Yasuhiro Nakasone on Nov. 6 as president of the ruling Liberal Democratic Party. He called on government to take “bold and innovative approaches” to counter Japan’s record trade surpluses.

The 63-year-old prime minister said he would seek to overhaul Japan’s industry by boosting knowledge- and technology-intensive sectors, and help small- and medium-sized enterprises cope with the yen’s nearly 80% rise against the U.S. dollar in the past two years.

Takeshita was finance minister when the yen began its dramatic rise, which has battered export-dependent firms by making their products more expensive overseas.

Restructuring Markets

“I intend to grapple with these issues both by restructuring the Japanese market to be widely open to the rest of the world and by shifting the Japanese economic base from one dependent on exports to one led by domestic demand,” Takeshita said.

“If we are to harmonize the Japanese economy, which now accounts for over 10% of world GNP, with the rest of the world economy, I believe Japan must work actively on improving market access, liberalizing capital and financial markets, restructuring the economy, and all the other changes that are needed,” he said.

Echoing complaints often voiced by Japan’s trading partners, Takeshita said, “Japan is one of the countries that has benefited the most from free trade, and I hope the people will understand that these reforms are needed not simply to reconcile the Japanese economy with the rest of the world’s economies but are indispensable prerequisites if Japan is to continue to develop.”

Touching on his pet project, the furusato or hometown development plan, Takeshita said Japanese should feel richer than they do now. The plan advocates rural development to conform with the nation’s industrial development and economic expansion.

Rural Development

“The fact remains that the people do not feel that their lives have become as affluent as our economic growth would warrant,” he said. He called furusato “an effort to create a land in which all Japanese can lead happier, more comfortable, and more rewarding lives.”

The Japanese leader further pledged to promote a wide range of reforms, including those in administrative, fiscal, tax, agricultural productivity, medical and welfare sectors.

Takeshita said he would try to eliminate unemployment, shorten working hours, create an environment where education continued throughout one’s lifetime, and promote research to cure intractable diseases such as cancer.