LATEST NEWS:

News Desk

The Yomiuri Shimbun

Publication Date : 28-02-2013

The approval rating for Prime Minister Shinzo Abe's Cabinet is continuing to rise, as it adroitly handles key domestic and foreign policies and has avoided any major blunders.

According to Yomiuri Shimbun surveys, the support rate for Abe's Cabinet was 71 per cent two months after its launch, up from 65 per cent immediately after its December formation and 68 per cent after one month.

Abe is apparently perceived to have skillfully handled issues such the Trans-Pacific Partnership multilateral trade negotiations and appointments of the next Bank of Japan governor and deputy governors. Stock prices have risen and the yen has weakened under his watch.

Learning from the bitter lessons of his first administration in 2006-07, Abe has kept at arm's length issues that could ignite undesirable reactions at home and abroad--such as revising the Constitution--until after the House of Councillors election in summer.

A lucky man

Abe was clearly pleased after the Diet passed a supplementary budget for fiscal 2012 on Tuesday.

"I felt like I was walking on thin ice when the vote was held," Abe said later at the Prime Minister's Office. "It was a huge first step from 'politics that can't make decisions' toward 'politics that can make decisions.'

"As the supplementary budget, which is [part of] the second 'arrow' [of my economic policies], has cleared the Diet, we can accelerate efforts to lift the economy out of deflation."

Through his "Abenomics" policies, the prime minister aims to defeat deflation and achieve economic revitalisation through "three arrows": monetary easing, fiscal stimulus and a growth strategy.

So far, Abenomics has corrected the yen's appreciation, which was hurting exporters, and helped stock prices hit highs not seen for several years.

A senior Nippon Ishin No Kai (Japan Restoration Party) lawmaker who voted for the supplementary budget said these results were hard to ignore.

"In the current atmosphere, it's impossible to throw cold water on Abenomics," he said.

Abe, meanwhile, has confided to people close to him that good fortune has played a part in his administration's peachy start.

"I'm lucky," Abe was quoted by a close aide as saying. "Deflation and the yen's appreciation continued until last year's House of Representatives election. In that situation, a monetary easing policy could produce results."

His meeting with US President Barack Obama in Washington last week demonstrated that the Japan-US alliance had regained its robustness, after it had shown signs of strain under the previous Democratic Party of Japan-led administration.

Whether Japan will join the TPP talks was a key agenda item during Abe's visit to the United States. In a significant victory, Abe succeeded in getting Obama to issue a joint statement that stipulates "it is not required to make a prior commitment to unilaterally eliminate all tariffs upon joining the TPP negotiations".

While taking into consideration Liberal Democratic Party members who oppose the TPP, Abe reportedly plans to announce Japan will participate in the negotiations as soon as early March.

Abe will submit to the Diet a proposal to appoint Asian Development Bank President Haruhiko Kuroda as the next Bank of Japan governor. Although Kuroda was formerly a Finance Ministry bureaucrat, he is a proponent of monetary easing. With the Cabinet's approval rate rising, some DPJ lawmakers have started considering accepting the proposal.

Lessons from 1st Cabinet

During his first administration, Abe called for "overturning the postwar regime" and his pet policies included attempts to review the National Referendum Law that stipulates procedures for amending the Constitution. However, his actions triggered protests within and outside the LDP.

This time, Abe's strategy is to concentrate on economic revitalisation and crisis management until the upper house election expected to be held in July. Potentially controversial issues such as reviews of diplomatic and security policies have been put on hold until after the election, because they could invite fierce debate and opposition at home and abroad.

Although the Abe Cabinet is flying high now, there is no guarantee it will stay there.

Some economists have suggested a resurgence of the European fiscal and monetary crises or other events could dilute the effects of Abenomics. Also, if the divided Diet causes a delay in implementing policies, the approval rating might fall, giving opposition parties an opening to strongly criticize the Abe administration.