Japan's economy seems to have hit bottom and the government's economic stimulus measures will start to be effective by next fall, the chairman of Prime Minister Keizo Obuchi's economic advisory panel said Wednesday.
"If we suppose that the economy is suffering from a cold, I think its fever has already abated," Hirotaro Higuchi, chairman of the Economic Strategy Council, composed of scholars and business leaders, told a press conference.
Touching upon a recent series of remarks made by Economic Planning Agency Director General Taichi Sakaiya, Jiro Ushio, chairman of the Japan Association of Corporate Executives (Keizai Doyukai), and others that signs of economic recovery have begun to appear, Higuchi said corporate inventories are decreasing and sales of minicars are brisk. "Although it's my personal hunch, the cold medicine will start to take effect by next fall," Higuchi said.
Higuchi endorsed the government's decision to freeze the Fiscal Structural Reform Law, which binds government spending in key areas, even though it may result in an increase in the issuance of deficit-covering bonds. "Regardless of whether we issue deficit-covering bonds or not, the nation's economy will deteriorate as long as we don't do anything (about the current economic condition)," he said.