Japan's new leader goes missing in action
Nikkei -- Nov 09
In the COVID-19 era, billions of people around the world wonder what leaders are doing to contain the economic fallout. For the Japanese, though, it is less about what than where.

Questions concerning the whereabouts of newish Prime Minister Yoshihide Suga abound as Asia's No. 2 economy staggers toward 2021. Early talk of newly assertive stimulus moves went quiet. So has chatter about his 54-day-old government putting some quick and notable reform or diplomatic wins on the scoreboard.

One common explanation for Suga's disappearing act is a scandal grabbing national headlines. Controversy over Suga barring a number of professors from the Science Council of Japan will sound insignificant to those abroad. It reminds voters, though, of the myriad scandals under his predecessor Shinzo Abe, who Suga served for nearly eight years as chief cabinet secretary.

There are two important takeaways from this low-visibility start. First, Suga is likely to be a short-timer, just like the six governments that came and went in a blur before Abe's 2012-2020 stint. Second, and most importantly, Suga seems destined to get little done to reorder an aging, rigid economy.

Granted, it is still early days. But Suga's priorities so far are as incremental as they are vague. Talk of reducing mobile-phone bills, digitalizing the government, support for fertility treatments and being carbon-neutral by 2050 sounds nice.

These plans lack audacity, though, as China invests trillions in dominating virtually every economic sector by 2025. And as developing Indonesia beats Japan in the tech unicorn race. Suga's pledges to continue a structural reform program Abe that could not get done with 2,821 days in power do not sound very promising either.

If Suga is going to shift the economy into higher gear, there is not a moment to waste. Here are three ways Suganomics can avoid being the punchline Abenomics has become.

One: telegraph a big bang, and fast. Suga missed an early and obvious opportunity by sticking with 80-year-old Taro Aso as finance minister. The same with keeping the rather low energy Hiroshige Seko as minister of economy, trade and industry. Naming a woman to one of these key posts -- something Abe would not do -- might have signaled change is coming to patriarchy.

Even so, Suga should empower his team to present a timeline for expedited moves to loosen labor markets, reduce bureaucracy, empower women, alter tax incentives away from giant exporters and revive the innovative spirit that China's Xi Jinping is working to instill in the 1.4 billion-person economy next door.

This cannot be mere talk. There must be clear and ambitious timelines for regulators and lawmakers to shake up Japan Inc. Since 2012, Tokyo has relied on stimulus sugar highs, while promising epochal change that never arrived. To beat this reformists-who-cried-wolf rap, Suga must roll up his sleeves and go big.

News source: Nikkei
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