Press Conference by the Chief Cabinet Secretary (Excerpt)

Q&As

• Japan-China relations (the Senkaku Islands)
• Economic Policy

REPORTER: I have a question concerning the incursion of Chinese Government vessels into Japan's territorial waters. Shortly after noon today three vessels entered Japan's territorial waters in the vicinity of the Senkaku Islands, where they remained for approximately an hour and a half. What is the response of the Government to this incursion?

CHIEF CABINET SECRETARY SUGA: It is a fact that, exactly as you described, three vessels entered Japan's territorial waters. Whatever the case, it is extremely regrettable that Chinese Government vessels entered Japan's territorial waters in this manner and is not something that can be accepted under any circumstances. The relevant ministries and agencies will continue to coordinate with a sense of urgency and take every possible measure for monitoring and surveillance.

REPORTER: Only the other day, New Komeito Chief Representative Yamaguchi met with President Xi Jinping of China and conveyed a personal message from Prime Minister Abe. The talks that took place then were at a high level and the statements that were made were reminiscent of a Japan-China summit meeting. What are your thoughts about the fact that despite the apparent desire to engage in friendly relations that was shown then, these actions (in Japan's territorial waters) have taken place?

CHIEF CABINET SECRETARY SUGA: I would not want to try to guess at any cause-and-effect relationship between the two events. However, given that the seas in question are Japan's territorial waters, in incidents such as these the Government will continue to use diplomatic channels to lodge stern protests calling for immediate withdrawal from our territorial waters.

(Abridged)

REPORTER: President Kaieda of the Democratic Party of Japan (DPJ) has launched a direct criticism on the Government's economic policies, which are known as "Abenomics," pointing out that these policies entail enormous fiscal expenditure, which could have the impact of increasing long-term interest rates. What is the Government's response to such criticisms?

CHIEF CABINET SECRETARY SUGA: Bearing in mind such concerns, we have taken our actions and we have incorporated a path to put the nation's finances on a sound footing into the budget compilation process on this occasion. We have also paid due attention to ensure that total issuance of government bonds is below the amount of income from tax revenue, therefore I believe that such criticisms are unfounded. Mr. Kaieda spoke of public works in relation to the widespread distribution of funds, and I would like to state here clearly that the Government's budgetary allocation for public works projects is virtually unchanged from the budget allocated by the previous DPJ administration. What we have done is simply restore the so-called block grants back to where the money was originally allocated and the actual sums involved have not increased at all, even in comparison with the budget of the DPJ administration. This is something I would like you all to understand, that the system of block grants was a clumsy one that was difficult for local governments to use. The money that was being used under the block grants structure was in fact being used for public works projects, but it was being channeled through the Cabinet Office, making it extremely difficult for the people of Japan to understand just how the budget was being utilized. What we have done is return that part of the budget to where it was originally allocated. So in fact it is simply a case of the money that had been allocated for block grants being added to the budget for public works projects, therefore I believe that any criticisms that the budget includes widespread distribution of funds that are unduly focused on public works projects are not valid. The Government will concentrate on essential public works projects from a safety perspective, the recent accident in the Sasago Tunnel being a case in point. It is this focus that I would like you all to understand.

REPORTER: In contrast to the criticisms raised by the DPJ, the market reaction to "Abenomics" has been positive, with the Nikkei Index today closing above 11,000 yen for the first time in two years and nine months. What is your reaction to the closing figure today?

CHIEF CABINET SECRETARY SUGA: As I have stated previously, I believe it to be preferable for share prices to be higher rather than lower, and I think that the market reaction represents a real and objective sense of expectation concerning the economic policies of the Abe Administration. In order to respond to these expectations, the Government is working to achieve the passage of the supplementary budget and the budget for next fiscal year as soon as possible, which will span the next 15 months, and achieve a seamless implementation of budgetary allocation. This is the way I believe we will respond to expectations.

(Abridged)