The Japanese government on Friday vowed to free up the country's financial markets and make them more globally competitive to help ensure economic growth as clouds gather over the economy.
The annual growth plans, which include measures to help small firms and promote permanent jobs for inexperienced workers, were announced earlier than usual, and come as public support for Prime Minister Yasuo Fukuda's government slides. But Economics Minister Hiroko Ota stressed that the rising risks facing the economy were the main reason for announcing the plans early.
"With a slowing US economy, a stronger yen and sluggish stock prices ensuing from the dollar's weakness, downside risks to the economy are heightening," Ota said on Friday. "The main aim of the plans is to act quickly to contain such risks." She acknowledged, however, that most of the steps outlined have already been discussed or approved by the government's top economic advisory panel and that it was difficult to measure what economic impact they would have.
Japan's economy grew a surprisingly strong 0.9 percent in the last quarter of 2007, but economists expect growth to slow in 2008 amid fears that the US economy - Japan's No 2 trading partner after China - is heading into recession.
Fukuda asked Ota last month to draft the plans by mid-April, much earlier than last year, when it took until June to finalise them. The prime minister's leadership image has been tarnished by a prolonged stalemate in the opposition-controlled upper house of parliament. The stand-off has already led to the central bank governor's chair being left empty and to the expiration of tax measures that threatening to leave a big hole in government revenue.
Fukuda's low support rates - just below 25 percent in a recently released TV survey - have sparked speculation that his ruling Liberal Democratic Party might try to replace him ahead of a general election that could come this year. "Rather than blindly seek an election, we should focus on what is needed to improve people's livelihoods," Fukuda told parliament on Friday.
FOLLOWING ARE KEY POINTS OF THE GOVERNMENT'S GROWTH PLANS: Not to levy tax on foreigners' income from funds invested in Japan through Japanese fund managers. - Allow exchange-traded funds that include investments in commodities such as gold to be listed on stock and other exchanges.
Create markets for professional traders with fewer regulations than those retail investors participate in. Promote use of information and communication technology at small firms. Expand public loan programme for small firms. Provide occupational training to inexperienced young and part-time workers and issue cards certifying training records.