The Global Economy in Turbulent Times

CHAPTER 59 Japan Picks Up the Pieces¹

Attended the global think-tank Asian Economic Panel (Columbia University) meeting recently in Tokyo hosted by Keio University. Research papers centered on Asia covering a range of topics were considered—from income distribution and wealth polarization, to business cycles and myths about China’s high-tech exports, to multinationals’ energy efficiency in manu- facturing, to fresh approaches in financing disaster reconstruction projects. Its timing accorded an opportunity to be updated on what’s happening to Japan, just prior to the October 2012 Intermeet gathering of the International Monetary Fund (IMF) and World Bank stakeholders in Tokyo. After all, Keio University advises the Ministry of Finance (MOF) and Bank of Japan (BoJ) on economic affairs; this special access provides its professors with unique insights, which enrich perspectives on Japan during meeting interactions.

IMF Updates

The October 2012 World Economic Outlook (WEO 2012) of the IMF paints an already familiar picture:

Recovery continues but it has weakened . . . (and) suffered new setbacks, with uncertainty weighing heavily on the outlook. . . . Those forces pulling growth down in advanced economies are fiscal consolidation . . . (which is holding back demand) and a still weak financial system. . . . Policies have not built confidence. Tail risks, such as those relating to the viability of the euro area or major US fiscal policy mistakes, continue to pre-occupy investors. ...