After a less-than-successful stint as prime minister for exactly one year in September 2006, Shinzo Abe has surprised many people in his second stab at the job. He has been resolute, decisive and some of the policies he has introduced have been sweeping and long overdue. Nowhere has that been more evident than in efforts to reinvigorate the national economy. When Abe was voted into office in December 2012, the yen was far too strong, exports were suffering, investment was stagnant, consumption was flat and a decade spent trying to get the nation out of inflation had come to nothing. In a little over 18 months, the transformation has been dramatic. No sooner than he had taken office than Abe laid out a three-pronged strategy - known as "Abenomics" - built on the connected pillars of fiscal stimulus, monetary easing and structural reforms to deal with the deeper problems that bedevil an economy that has been in recession or, at best, anemically positive, since the start of the 1990s. Seven months after his election victory, Abe set off for his first G8 summit in Northern Ireland buoyed by a gross domestic product that climbed at an annualised rate of 4.1 per cent in the January-March 2013 quarter, while the stock market had fattened by 50 per cent since the previous November. The value of financial assets held by Japanese households leapt more than 3 per cent in the final quarter of fiscal 2012, and the yen recovered from a low of 76 yen (HK$5.8) to the dollar in February 2012 to above 100 yen in April last year. Not everything that the prime minister touched turned to gold, however, with some detractors suggesting that his policies were thin on details of how precisely he planned to turn around the economy in the long term. Japan logged a customs-cleared trade deficit of 2.79 trillion yen in January, the largest monthly deficit since comparable data was first compiled in 1979. The deficit was worsened by the high cost of fuel imports to meet the thirst for energy while the nation's nuclear reactors remain off-line. Equally, the weakening of the yen against other key currencies also contributed to an increase in the value of imports. Those figures were highlighted by the critics and used to underline data that showed that the national economy had grown only a weak 1 per cent on an annual basis in the final three months of last year. Even Abe's critics conceded that his first two "arrows" - quantitative easing shifted the currency rate and the stock exchange bounced back, while supplementary budgets were put into motion and the tax rate is rising - but there was a sense that the third arrow of fundamental reform had not been unleashed. Perhaps stung by those criticisms, Abe has pushed through plans to deregulate the energy sector and improve the amount of child care that is available to families, while he has been bullish on plans to reduce the corporate taxation rate to 30 per cent. Other measures include the creation of special development zones to encourage local businesses, opening up the agriculture sector, extensive government support for clean energy and robotic technology, and abolishing tax breaks for housewives in an effort to get them into the workforce. Parliament has also opened discussions on revising laws to permit casinos to open, part of a broader plan to attract more foreign visitors. The number of annual overseas tourists has already surpassed the 10 million level, but Tokyo has set the ambitious target of 20 million visitors in 2020, the year in which Tokyo will host the summer Olympic and Paralympic Games. Speaking at a conference in Tokyo in late April organised by The Economist, Abe described his campaign as "a golden opportunity to put the economy on to a stable, new growth track". "The economic policy my cabinet is pursuing must this year enrich each and every individual and deliver the fruits of growth to every corner of the nation," he said. The prime minister said he intended to achieve this by making the most of Japan's geographical advantage at the heart of the booming Pacific Rim region, by taking advantage of strong demand in developing Asian nations for Japan's machine tools and capital goods, and by opening the domestic economy to embrace "outside vitality, along with human resources, capital and wisdom from abroad". Key to this will be a series of trade agreements, the most important of which will be the Trans-Pacific Partnership, for which negotiations with the United States are continuing. Also on the agenda is an economic partnership agreement with the European Union. "Everything that Abe said shows that he wants Japan to be a player and to be at the centre of the highest growth area of the Asia-Pacific region," says Jesper Koll, managing director and head of Japanese equity research for JP Morgan in Tokyo. "Japan does not want to be on the periphery, and that's a good thing." To underline the positives that have been achieved, many critics of the prime minister's proposals identified the increase in the consumption tax from 5 per cent to 8 per cent on April 1 as the date on which his policies would begin to flounder. Consumption would drop off precipitously, they said, as consumers saved instead of spending. And, while the public did go on a spending spree in the weeks running up to the increase, only serving to heighten the nay-sayers' warnings, the early indications are that the market has already put the hike behind it. Abe has not magically fixed all the nation's woes at once, but he will be quietly satisfied that he has taken a solid first few steps in the right direction.