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By Leika Kihara
TOKYO (Reuters) – Globalization will continue and chains will diversify as corporations adapt to the new coronavirus disruption, the governor of Japan’s central bank said Friday, defying speculation that the virus would lead to the fragmentation of world trade.
The use of protectionism is not the solution, said the governor of the Bank of Japan (BOJ), Haruhiko Kuroda.
“Globalization and global source chains will continue, even though the source chains will be more diversified and resilient,” Kuroda said at a seminar organized through the Asian Development Bank.
Regional monetary cooperation is vital in the coming years, as it would provide a protective net in the event of any other shock, he said.
“We will have to take decisive action at the right time, while largely following the effect of COVID-19,” Kuroda said.
“At the same time, we will have to Array . . . turn this crisis into an opportunity to boost digitization and facilitate innovation,” said Kuroda, who led the Asian Development Bank before taking over as governor of the BOJ in 2013.
Kuroda said japan’s economy will most likely continue to improve, albeit at a moderate pace, given the global impact on the coronavirus.
“The BOJ will continue with the economy in cooperation with the new government,” led through Yoshihide Suga, he said.
Analysts expect any primary adjustment in dating between the BOJ and a management led through Suga, who led his predecessor Shinzo Abe’s strategy of reviving the economy with ambitious financial and fiscal measures.
(Report via Leika Kihara; Edited via Chang-Ran Kim)