Japan PM Kishida vows to do utmost to ensure wage growth

TOKYO – Japanese Prime Minister Fumio Kishida said on Wednesday his government would mobilise all available policy tools to ensure wage growth, signalling the need to raise workers’ pay further to offset inflation and sustain economic growth.

“There are budding signs of (economic) recovery such as stock prices at a 33-year high,” Mr Kishida told a press conference marking the end of regular Parliament sessions.

“Wage growth is hitting a 30-year high (above 3 per cent, and domestic investment hit 100 trillion yen [S$946 billion]); positive moves are emerging in Japan’s economy.”

The government would create a new investment package for semiconductors, energy and other areas, Mr Kishida said.

Asked if there was a need to compile an extra budget to shift the economy into higher gear, he said he was “not considering now an extra budget”.

However, he also said he would decide whether any extra spending would be needed further down the road by taking into account effects of steps taken so far and trends in global energy markets.

Japan’s gross domestic product expanded at an annualised 2.7 per cent in the January-to-March period, much higher than a preliminary estimate, as revised capital expenditures and firm private consumption more than offset a slowdown in global demand, which is weighing on manufacturers.

Japan has compiled extra budgets in the past years, partly aiming to provide subsidies to cushion the blow from high costs of imported fuel, which were amplified by a weak yen.

At the same press conference, Mr Kishida said nothing had been decided on a potential visit to China.

He said he felt his meeting with China’s leader Xi Jinping in 2022 gave momentum to positive relations. REUTERS