KEY TAKEAWAYS
- While the Takaichi government is still finalizing its growth strategy and basic policy, policy papers issued this week clarify how the government is preparing to ramp up spending in pursuit of Prime Minister Takaichi Sanae’s vision of a “strong and prosperous Japan.”
- The government outlined a sweeping public-private investment framework across a range of strategically important sectors. But while significant public outlays are likely, the government has not offered details on how much funding the state will provide.
- Takaichi is wagering that she can reassure markets that her plans will produce a “virtuous cycle” of higher growth and tax revenues; if investor confidence erodes she courts a spike in interest rates, higher inflation, and slower growth, risking the poorer, more insecure future she is determined to avoid.
Japan Foresight 