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By Kaori Kaneko
TOKYO (Reuters) – Japan’s new prime minister focuses on fighting the COVID-19 pandemic, digitizing the economy and creating jobs, a Reuters ballot showed Friday.
Analyst survey predicts that the world’s third-largest economy will contract more than expected in the current fiscal year through March, as the pandemic hits households.
Chief Cabinet Secretary Yoshihide Suga, leader of the ruling party leadership race on September 14, said preventing the spread of the virus would be his most sensible priority.
Suga, ready to succeed outgoing Prime Minister Shinzo Abe, also said his main task as the nation’s leader would be to revive the economy.
When asked which spaces the government is concentrating on under the new prime minister, 37 economists settled on “response to the coronavirus pandemic” from September 2 to 10, while 28 chose “digitization in society and among the Business”.
The coronavirus crisis has highlighted the technological deficiencies of the Japanese government and companies, many of them in a role-based culture that experts say undermines productivity.
Twenty-two economists chose to “create jobs and stimulate domestic demand” and thirteen opted for “foreign and security policy. “
The survey allowed respondents up to 3 domains.
“Fiscal spending is still desired,” said Mari Iwashita, Daiwa Securities’ market-leading economist. “Given the budgetary constraints, we want to move on to a specific and effective expenditure. “
Of all the economists surveyed in the survey, the median forecast of 30 analysts showed that Japan’s economy is expected to contract 6. 0% this fiscal year, the sharpest contraction since comparable knowledge was gained in 1994 and worse. than the 5. 6% drop projected last month.
A worst-case situation showed that the economy could contract by 8. 1%.
Some analysts responded to the survey before knowledge published Tuesday showed that the economy fell by 28. 1% in the last quarter, more than expected.
Basic customer prices, which exclude new and volatile foods but have energy costs, are likely to fall by 0. 4% in the existing fiscal year and increase by 0. 2% next year, according to the survey.
Nearly two-thirds of the economists surveyed expect the Bank of Japan’s next course of action to be to expand its stimulus measures, as the pandemic continues to weigh on the economy.
“The BOJ protects the economy from domestic and foreign risks,” said Tetsuya Inoue, a leading researcher at the Nomura Research Institute.
(Report via Kaori Kaneko; Survey through Shaloo Shrivastava and Manjul Paul in Bangalore; Editing via Leika Kihara and Subhranshu Sahu)