CGTN Europe interviewed Seijiro Takeshita, Professor of at the School of Management at the University of Shizuoka
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00:00Earlier, I spoke to Sejuro Takshika, a professor at the University of Sozooka,
00:05and I started by asking him about Japan's debt crisis.
00:08Well, I think this subject had been swirled around very much by the words of Mr. Shiba,
00:15our prime minister, who said that our condition is worse than that of Greece, which is simply wrong.
00:22Now, I hear your point that, you know, our debt condition is in a very dire situation, that's true,
00:27but let's look at the right side of the balance sheet.
00:30In other words, if you look at the net assets, you know, Japan had had the highest in the past 33 years.
00:36It was surpassed by Germany this year.
00:38But basically, and if you look at the also composition of the debt itself, 94% of the debt is consumed within Japan.
00:46So we have a totally different condition to that of Southern Europe.
00:51So, of course, you know, I'm not saying we should relax on the back of the sofa,
00:55but, yes, you know, we are obviously in a very much of, I would say, almost a cornered state.
01:02That's very, very true, but not as serious as many people depict.
01:06So we've had some interesting, important economic data out, a bit of a mixed picture.
01:11So core inflation hitting more than a two-year high in Maine.
01:15What do you think is behind that?
01:16Well, undoubtedly, the inflationary pressure, particularly caused by foodstuffs, which has been rising,
01:23and particularly rice, our main diet, which has risen by 93% year and year,
01:28and also energy prices went up by more than 8%, which basically resulted in gases going up by 6.6%.
01:36And it seems, though, that consumers are wanting to spend more.
01:39They're one of the, if not the most conservative, you know, consumers in the world.
01:45They're very much risk avoidant.
01:48So, you know, they basically would start spending only if, in my opinion,
01:53they could clearly see the outcome of their corporate activities, you know,
01:57that is coming back to its feet and being brisk.
02:01You can throw money, you know, in their faces,
02:03which is what the government had been doing in the past two decades,
02:07which really does not have to multiply to the economy.
02:10It's been proven.
02:11And the reason for that is the conservativeness of the Japanese consumers.
02:15And also, let's not forget that, you know,
02:17the income hasn't risen for well over two decades,
02:21in spite of the fact that Japanese corporations have been making, you know, record profit.
02:26Now, this year, things are different.
02:28You know, of course, if you look at the wage negotiation,
02:31you can see all the companies finally starting to raise, you know, their pay, their wages.
02:37But obviously, you know, the mood, or I should say the atmosphere or the sentiment of the consumer
02:43isn't that positive because, as you just reported, you know,
02:47the rise in inflation is certainly dampening, you know,
02:50their consumer sentiment without a speck of doubt.
02:54And can Japan realistically manage inflation while its key export markets are weakening
02:59due to these increasing trade tensions, especially with the United States?
03:04It would be very, very difficult, to say the least.
03:07In fact, it would be almost impossible,
03:09considering the fact that Bank of Japan do not have the power to alter the trend of weakening at the end.
03:17Many people talk about the rate rise,
03:19but I think Bank of Japan's maneuverability is very limited.
03:23You know, they don't have the deep pockets that, you know, European central banks or Fed has.