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Shinzo Abe

‘No worries’: PM Shinzo Abe says Japan’s shrinking population not burden but incentive

Abe’s comments come days after official data showed that Japan has 34.6 million people aged 65 and older, or 27.3 per cent of the population – the highest proportion among advanced nations

PUBLISHED : Wednesday, 21 September, 2016, 11:02pm
UPDATED : Wednesday, 21 September, 2016, 11:25pm

Prime Minister Shinzo Abe said Japan’s ageing, shrinking population was not a burden, but an incentive to boost productivity through innovations like robots, wireless sensors, and Artificial Intelligence.

Abe’s comments on Wednesday came days after official data showed that Japan has 34.6 million people aged 65 and older, or 27.3 per cent of the population – the highest proportion among advanced nations.

“I have absolutely no worries about Japan’s demography,” Abe said in a prepared speech at a Reuters Newsmaker event, noting that nominal gross domestic product had grown despite losing three million working-age people over the last three years.

I have absolutely no worries about Japan’s demography ... Why? Because we will continue to be motivated to grow our productivity
Prime Minister Shinzo Abe

“Japan may be ageing. Japan may be losing its population. But these are incentives for us,” he said.

“Why? Because we will continue to be motivated to grow our productivity,” Abe added, citing robots, wireless sensors, and Artificial Intelligence as among the tools to do so.

“So, Japan’s demography, paradoxically, is not an onus, but a bonus.”

Japan seeks to double foreign workers to combat ageing, falling population

Abe has said he wants to halt the slide in Japan’s population at 100 million people by 2060, about one-fifth below the current level. The government also aims to raise the fertility rate from 1.4 births per woman to 1.8 – still below the 2.1 needed to prevent a population from shrinking.

Abe has focused on mobilising women and the elderly to compensate for a shrinking workforce rather than tackle head-on the politically touchy topic of immigration, although some changes are being considered on that front.

Abe, who returned to office in December 2012 for a rare second term pledging to reboot the economy with his “Abenomics” mix of ultra-easy monetary policy, fiscal spending and reforms, reiterated that the economy remained his top priority.

Critics worry he might switch his attention to trying to revise Japan’s post-war pacifist constitution, as Abenomics seems to be running out of steam.

Hours before Abe spoke, the Bank of Japan made an abrupt shift to targeting interest rates on government bonds to achieve its elusive inflation target, after years of massive money printing failed to jolt the economy out of decades-long stagnation.

Abe welcomed the decision, expressed confidence in his hand-picked central bank chief, Governor Haruhiko Kuroda, and vowed to work with the BOJ.

“The government and the BOJ will work as one in close coordination to accelerate ‘Abenomics’,” he said, answering questions after his speech.

“We haven’t escaped from deflation yet. I believe we can make steady progress toward escaping from it.”

The hidden agenda behind Japan’s Abenomics

The prime minister also said his government would seek quick approval by parliament of the Trans-Pacific Partnership (TPP) pact and urged the United States to do the same.

“Please do ratify the TPP,” Abe said. “We are simply waiting for you to take a leadership role. ‘Come along, America’, should be my own message to you.”

US President Barack Obama’s administration intends to make a final full-court push to convince Republican leaders in the US Congress to approve the 12-nation trade deal in a “lame duck” session after the November 8 presidential election.

Both Hillary Clinton, the Democratic Party candidate, and Republican candidate Donald Trump are opposed to the pact, which is unpopular with US labour unions and environmental groups.

Abe also made a pitch for Japan’s high-tech “maglev” railway, suggesting once again that the technology, which Central Japan Railway Company (JR Tokai) aims to use to link the cities of Tokyo and Nagoya by 2027, would be a good fit for the New York-to-Washington route.

“The distance between Tokyo and Nagoya is almost the same as that between New York and DC,” Abe said. “And by the way, you could do the same thing here with the maglev technology that is there for you to get.”