Economic conditions in Japan have improved since the government took office seven months ago, Finance Minister Naoto Kan said Monday, but added that huge public debt remained a challenge. Citing rising share prices and a weaker yen, Kan told reporters at the Foreign Correspondents' Club of Japan that "no one can deny that Japan's fiscal and economic management has been improving since the Hatoyama government took office" in September.
"At the time of the Dubai shock, the Nikkei-225 was on the verge of dipping below 9,000 yen," said Kan, referring to the late November plunge in global financial markets over fears of a possible debt default by Dubai. "But now it's above 10,000," he said. "In addition, the yen was appreciating (against the dollar) to above 84 yen at the time. Now it's lower by about 10 yen," Kan said.
Japanese exporters favour a cheaper yen against the dollar as it makes their goods more competitive and boosts their overseas earnings when repatriated. Kan added that the government under Prime Minister Yukio Hatoyama has passed a record trillion-dollar budget for the fiscal year starting this month, aiming to stimulate the sluggish economy.