Formally re-elected head of the ruling party, Prime Minister Shinzo Abe said Thursday he has set out three new goals for “Abenomics” and will target a 20 percent increase in gross domestic product to ¥600 trillion.The three new economic policy goals include: promotion of economic growth, child-rearing assistance to push up the low birth rate and social security measures to increase nursing facilities for the elderly.
Abe has been promising economic growth since he ran for office, but he has had little to show for his efforts lately. From April to June, the Japanese economy contracted by 1.6 percent, dashing previous hopes that a sustained recovery might be taking hold. In an embarrassing turn of events on Thursday, Abe announced an end to deflation just hours before a report came out saying that prices had fallen for the first time since 2013.
Much of the downturn is driven by factors outside of Abe’s control. Japan’s economy has been hit hard by the Chinese slowdown. Furthermore, Abe came into office after decades of stagnation, so it was never realistic to expect a quick turnaround. Still, the United States has a strong interest in seeing Japan, which is the biggest regional counterweight to China, start growing.