Prime Minister Shinzo Abe is set later Tuesday to call a snap election and seek voters' endorsement for more economic reforms after Japan slipped into recession.
Less than two years after he swept to power pledging to reinvigorate the flagging economy, Abe is expected to say more needs to be done to fix years of growth-sapping price-falls.
"We are finally taking the opportunity to get rid of deflation," Abe told a meeting of lawmakers and officials from his junior coalition partner Komeito.
The last 24 months have seen two of the so-called "three arrows" of "Abenomics" fired -- massive fiscal stimulus and a flood of easy money. A third "arrow" of structural reforms remains stuck in the quiver, a victim of the vested interests it is intended to undermine.
At its heart, Abenomics is intended to push prices up and get Japanese shoppers spending, with the aim of generating a self-reinforcing recovery as companies employ more people to meet growing demand.
The measures have sent the yen plunging, pushing up the cost of imports, including the fossil fuels used to power the country.
That stretched consumers -- 60 percent of the economy -- who were then walloped again in April by a rise in sales tax from 5.0 to 8.0 percent, resulting in two consecutive quarters of contraction.
Abe is almost certain Tuesday to say he is delaying part two of the tax rise, to 10.0 percent, which is due for October.
"I will judge the consumption tax calmly," he said. "People's life won't get better without economic growth."
- New stimulus plans -
Ignoring criticism that he is currying favour with voters, Abe is expected to order his ministers to compile fresh economic stimulus, including measures to ease the impact of rising import prices.
The media consensus is that he will call the election for December 14, with the lower house to be formally dissolved later this week.
"Abenomics is at a crucial point," Sadakazu Tanigaki, secretary-general of Abe's Liberal Democratic Party, told reporters after attending a meeting of LDP senior officials.
"I told them: 'Let's work together based on decisions by the prime minister'," Tanigaki said.
Opposition parties, who are still in disarray after their 2012 drubbing, will be hoping to capitalise on the difficulties faced by voters whose wages are at a standstill while prices rise.
"It is clear that Abenomics has not had any positive impact on people's life at all," said Banri Kaieda, head of the largest opposition Democratic Party of Japan.
Yoshiki Yamashita, a Communist Party lawmaker, said "Abenomics merely expanded the gap" between the haves and the have-nots.
But commentators across the spectrum agree that Abe, who enjoys approval ratings of around 50 percent, is likely to stroll home in the popular vote. They point out that the premier's real target is rivals within his own fractious LDP.
The thinking goes that as he faces a three-yearly party leadership election in September, he could stamp his authority over the grouping by resetting the clock now.
"I suppose Prime Minister Abe concluded that it's the best timing to extend his premiership," said Shinichi Nishikawa, professor of politics at Meiji University in Tokyo.
"But the prospects for his decision are still uncertain," Nishikawa said. "It may come at a price, depending upon election results."
A new mandate would bolster his case for pushing ahead with the re-starting of nuclear reactors -- an unpopular idea in a nation scarred by the 2011 Fukushima disaster.
It would also strengthen Abe's hand on pet issues like reforming Japan's view of its 20th century warmongering, which he and other right-wingers say is masochistic.
Prime Minister Shinzo Abe is set later Tuesday to call a snap election and seek voters’ endorsement for more economic reforms after Japan slipped into recession.
Less than two years after he swept to power pledging to reinvigorate the flagging economy, Abe is expected to say more needs to be done to fix years of growth-sapping price-falls.
“We are finally taking the opportunity to get rid of deflation,” Abe told a meeting of lawmakers and officials from his junior coalition partner Komeito.
The last 24 months have seen two of the so-called “three arrows” of “Abenomics” fired — massive fiscal stimulus and a flood of easy money. A third “arrow” of structural reforms remains stuck in the quiver, a victim of the vested interests it is intended to undermine.
At its heart, Abenomics is intended to push prices up and get Japanese shoppers spending, with the aim of generating a self-reinforcing recovery as companies employ more people to meet growing demand.
The measures have sent the yen plunging, pushing up the cost of imports, including the fossil fuels used to power the country.
That stretched consumers — 60 percent of the economy — who were then walloped again in April by a rise in sales tax from 5.0 to 8.0 percent, resulting in two consecutive quarters of contraction.
Abe is almost certain Tuesday to say he is delaying part two of the tax rise, to 10.0 percent, which is due for October.
“I will judge the consumption tax calmly,” he said. “People’s life won’t get better without economic growth.”
– New stimulus plans –
Ignoring criticism that he is currying favour with voters, Abe is expected to order his ministers to compile fresh economic stimulus, including measures to ease the impact of rising import prices.
The media consensus is that he will call the election for December 14, with the lower house to be formally dissolved later this week.
“Abenomics is at a crucial point,” Sadakazu Tanigaki, secretary-general of Abe’s Liberal Democratic Party, told reporters after attending a meeting of LDP senior officials.
“I told them: ‘Let’s work together based on decisions by the prime minister’,” Tanigaki said.
Opposition parties, who are still in disarray after their 2012 drubbing, will be hoping to capitalise on the difficulties faced by voters whose wages are at a standstill while prices rise.
“It is clear that Abenomics has not had any positive impact on people’s life at all,” said Banri Kaieda, head of the largest opposition Democratic Party of Japan.
Yoshiki Yamashita, a Communist Party lawmaker, said “Abenomics merely expanded the gap” between the haves and the have-nots.
But commentators across the spectrum agree that Abe, who enjoys approval ratings of around 50 percent, is likely to stroll home in the popular vote. They point out that the premier’s real target is rivals within his own fractious LDP.
The thinking goes that as he faces a three-yearly party leadership election in September, he could stamp his authority over the grouping by resetting the clock now.
“I suppose Prime Minister Abe concluded that it’s the best timing to extend his premiership,” said Shinichi Nishikawa, professor of politics at Meiji University in Tokyo.
“But the prospects for his decision are still uncertain,” Nishikawa said. “It may come at a price, depending upon election results.”
A new mandate would bolster his case for pushing ahead with the re-starting of nuclear reactors — an unpopular idea in a nation scarred by the 2011 Fukushima disaster.
It would also strengthen Abe’s hand on pet issues like reforming Japan’s view of its 20th century warmongering, which he and other right-wingers say is masochistic.
