"Takaichi, 64, wants to avoid the fate of her predecessor, Shigeru Ishiba, who was in power barely a year before he was pushed out amid widespread public discontent over stubborn inflation, among other issues. An admirer of former premier Shinzo Abe, Takaichi has vowed to pursue her mentor's "Abenomics" a set of policies that involved ultra-loose monetary policy, fiscal stimulus and structural reforms to get Japan out of its decades-long deflationary spiral of falling prices and weak consumer spending."
"Can the stimulus accelerate growth in Japan? Werner Pasha, a Japan expert and professor emeritus at the University of Duisburg-Essen's Institute of East Asian Studies, believes the stimulus won't significantly foster economic expansion. "First, additional demand means that there will be more inflationary pressure, possibly already in the short term, but at least in the medium term," he told DW. "Second, it is questionable whether the government can really increase effective expenses so fast as it would like to. In the past, it could not.""
Sanae Takaichi has prioritized stimulating economic growth while tackling the rising cost of living since taking office in October. She intends to pursue Abenomics: ultra-loose monetary policy, fiscal stimulus and structural reforms to end decades of deflation and weak consumer spending. A large fiscal package worth $135 billion includes cash handouts to parents, energy subsidies, financial help to households and increased defense spending. Japan's economy contracted in the third quarter, adding pressure for action. Additional demand from stimulus will likely increase inflationary pressure in the short to medium term. The government may struggle to deploy effective spending quickly, limiting near-term growth acceleration.
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