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NO. 34 - September 12, 1997

 

Feature Article

A PERSPECTIVE ON TOKYO'S 'BIG BANG' AND OTHER ECONOMIC REFORMS

An Interview With Naoki Tanaka, President, The 21st Century Public Policy Institute

Prime Minister Ryutaro Hashimoto began his second term in office last fall vowing that he would "burn himself to ashes" to realize sweeping reforms of Japan's administrative, economic and social welfare systems. By the Diet's late June adjournment, he had made notable progress toward this goal, securing enactment of measures changing foreign exchange trading, the corporate financial structure, monetary policy implementation and bank supervision. Naoki Tanaka, a prominent economist in Japan and president of a new business-supported think tank, The 21st Century Public Policy Institute, recently discussed the impact of these reforms and the outlook for the Japanese economy with JEI Senior Political Analyst Barbara Wanner.

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Weekly Review

Hashimoto Reelected LDP Chief; Scramble Ensues For Cabinet Posts
---by Barbara Wanner

As anticipated, Prime Minister Ryutaro Hashimoto was reelected unanimously September 8 as president of the ruling Liberal Democratic Party -- the first LDP chief in 13 years to win a second two-year term since former Prime Minister Yasuhiro Nakasone in 1984. Running unopposed, Mr. Hashimoto's reelection as the Liberal Democrats' standard-bearer basically amounted to a pro forma exercise for ruling party members. LDP lawmakers' formal confirmation before the Diet September 11 that Mr. Hashimoto will continue as their party leader means that he also will remain prime minister.

 

Hashimoto Emphasizes Security Dialogue On China Trip by Eric Altbach

Prime Minister Ryutaro Hashimoto called for an enhanced security dialogue between Japan and the People's Republic of China and deeper cooperation in areas of mutual interest during his September 4-7 visit to Beijing and northeastern China. The trip coincided with the 25th anniversary of the normalization of relations between Tokyo and Beijing. Mr. Hashimoto reassured President Jiang Zemin and Premier Li Peng, China's leaders, that Japan does not support independence for Taiwan. He also promised to work toward greater "transparency" in the ongoing U.S.-Japan discussions concerning the expansion of the 1978 bilateral defense operational guidelines.

 

Government Strives To Cut FY 1998 Budget by Jon Choy

Tokyo's budget compilation process increasingly is criticized as out of step with the economy's and society's contemporary needs. In response, Prime Minister Ryutaro Hashimoto made reforming the government's structure and its operations a top priority. Included under this umbrella is revamping the budget process to make it more flexible and responsive to evolving social, political and economic goals. According to observers, some signs that Mr. Hashimoto is carrying out his pledge can be gleaned from the process of putting together the general account budget for FY 1998. Of course, critics complain that the changes so far are not enough to really shake up the budget system and that Mr. Hashimoto must exert stronger leadership in order to solve important budget matters.

 

Impact Of Asian Currency Woes On Japan Likely To Be Modest by Douglas Ostrom

Although Japan's economy increasingly is linked to those of its Asian neighbors, the financial turmoil in Thailand, Malaysia and elsewhere in the region will not have a major impact on the largest economy in the area. However, some individual Japanese companies may end up being strongly affected.

 

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