Japanese Privatization Minister Warns Economy Still Shaky

Heizo Takenaka, the minister leading a privatization drive, said June 16 that Japan's economy was still shaky despite its heralded recovery. "When everyone said the Japanese economy was bad three or four years ago, I wasn't that pessimistic, but now, when people say the economy is getting better, I don't really feel optimistic," Takenaka told a panel of the World Economic Forum for East Asia.

Japan's economy grew at an annualized 3.1% revised first-quarter figures showed; the latest sign that Japan has snapped out of a decade of economic doldrums.

Japanese share prices posted their biggest fall earlier this week since 2001, largely on concerns over the U.S. economy, although they made up for the losses by June 16. Many analysts say the turbulence is a natural reaction to a fast rise on the Tokyo market, which gained 40% in 2005.

Minister Junichiro Koizumi, who steps down in September, has been a staunch supporter of privatization, winning a landslide election victory last year campaigning on breaking up the post office's giant monopoly. "What we face now is whether Koizumi's successor really can take over his reforms," Takenaka said.

Copyright Agence France-Presse, 2006

TAGS: Trade
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