Press Conference by the Chief Cabinet Secretary (Excerpt)

Q&As

• The implementation of further monetary easing measures by the BOJ
• The issue of coral poaching
• The issue of the abductions

REPORTER: The Bank of Japan (BOJ) has today announced that it will implement additional monetary easing. Can I ask for a comment from you about this announcement?

CHIEF CABINET SECRETARY SUGA: I believe that the decision made in the Monetary Policy Meeting of the BOJ today to implement further monetary easing measures was made after careful consideration by the bank with regard to the economic and financial situation and the future outlook.

REPORTER: This is the first time since April last year for large-scale monetary easing to be implemented and the decision made today was unusual in that it was opposed by four members of the Monetary Policy Meeting. What are your thoughts about this?

CHIEF CABINET SECRETARY SUGA: As I just stated, I believe that although there was some opposition, the decision made today was a result of careful consideration by the bank. I would like to refrain from saying anything further on behalf of the Government.

REPORTER: There are some who view this new round of monetary easing as a preemptive measure to stimulate the economy and prepare an environment for the Prime Minister to be able to determine that a further rise in the consumption tax rate is possible. What are your thoughts about this view?

CHIEF CABINET SECRETARY SUGA: There are a number of views concerning this issue, but I believe that the bank is implementing measures towards achieving its price stability target of 2 percent. The measures announced today were determined by the bank. With regard to this target and its background, I do not think that the Government should make any comment other than what the bank itself has announced.

REPORTER: I have a related question. Share prices today have marked their biggest one-day rise in six years, with the share price index rising to its highest level in seven years. What are your views on this increase in share prices and the factors behind it?

CHIEF CABINET SECRETARY SUGA: I would surmise that today’s increase is a result of a number of factors, including the BOJ’s decision today to implement further monetary easing and also the press reports concerning the Government Pension Investment Fund (GPIF).

REPORTER: In a press conference BOJ Governor Kuroda indicated his strong resolve to ensure the achievement of the price stability target of 2 percent that you just mentioned. There are some who consider that the effect of such financial policy will only be temporary. Therefore, as the focus of attention will move to the Government’s economic policies and management of the economy, does the Government have any plans to harmonize policies in response to the BOJ’s announcement today concerning additional monetary easing?

CHIEF CABINET SECRETARY SUGA: I believe that in principle the Government and the BOJ will continue to cooperate and coordinate their actions. The background to the BOJ’s decision is as the bank has announced. I believe that is all there is to the matter.

REPORTER: Someone has already asked this question, but is the decision on additional monetary easing likely to impact the decision on whether to raise consumption tax, which is expected to be made in December?

CHIEF CABINET SECRETARY SUGA: I would like to refrain from making any comment on this point. In any event the bank has announced its objectives and the background to the decision that has been made today. There is nothing more or less to the matter.

REPORTER: Regardless of today’s decision concerning additional monetary easing, is there no change to the Government’s stance regarding whether or not to raise the consumption tax?

CHIEF CABINET SECRETARY SUGA: There is no change to the Prime Minister’s stance. Whatever the case, the Prime Minister will make a final decision, after hearing the opinions of experts and many others.

(Abridged)

REPORTER: I assume that the BOJ made its decision today in view of the weakness of the economy. Is the Government not considering similar economic measures?

CHIEF CABINET SECRETARY SUGA: In any case, I believe that the bank made its decision today in order to realize Governor Kuroda’s stated goal of achieving a price stability target of 2 percent. The Government, for its part, will continue to make its own response while taking into account the various circumstances.

REPORTER: I have a question on a slightly different topic. In a New Komeito party conference today many members expressed the view that the anticipated rise in consumption tax to 10 percent in October next year should be postponed. The Liberal Democratic Party (LDP) is also holding its own party conference, and a growing number of ruling parting members are expressing caution on the consumption tax rise and are calling for the Government to reflect the opinions of local voters in electoral constituencies. What is your frank view of the current situation?

CHIEF CABINET SECRETARY SUGA: Firstly, the Abe Cabinet considers economic revitalization to be a top priority and is making every effort to ensure that it is the Abe administration that achieves Japan’s exit from 15 years of deflation. I have previously stated that the administration is attempting to achieve the difficult double feat of exiting from deflation and rehabilitating finances. Accordingly, there is no change to the basic concept of viewing the preliminary growth figures for the July to September quarter that will be announced in November and December, and using these as the basis for making a careful decision. I would like to refrain from making any comment from a Government position concerning the New Komeito, but it is my understanding that politicians who are interacting with their constituents will have received a variety of opinions on this matter.

REPORTER: I have a further related question. Will the tempering of expert views by cautious opinions from within the ruling parties have any impact on the Prime Minister’s decision on whether or not to raise consumption tax to 10 percent?

CHIEF CABINET SECRETARY SUGA: As I have mentioned on several occasions, the Prime Minister will make a comprehensive decision. That is all.

REPORTER: You have just stated that there is no change to the Government’s stance of considering the tax rise in view of the preliminary figures for the July to September quarter. Are you referring to the second preliminary figures for the July to September quarter?

CHIEF CABINET SECRETARY SUGA: No, I said the preliminary figures announced in November and December and that is what I meant.

REPORTER: So the Government will consider both sets of figures?

CHIEF CABINET SECRETARY SUGA: Yes.

(Abridged)

REPORTER: Returning to the matter of the BOJ, Governor Kuroda has stated that one of the reasons for the monetary easing on this occasion is due to the risk that conversion of the deflationary mindset might be delayed. Until now Governor Kuroda has stated that the negative drop in economic output due to the rise in consumption tax was within expected parameters. However I believe that such a stance has miscalculated the trajectory for economic recovery to some extent. What is the Government’s recognition on this issue?

CHIEF CABINET SECRETARY SUGA: I suggest that you first ask Mr. Kuroda about this matter. The Government will closely monitor the developments following the recent decision by BOJ, and will move to steadily and thoroughly implement the government policies one by one. That is all.

REPORTER: I have a related question. You have stated that the decision on additional monetary easing was made by the BOJ. In his press conference Governor Kuroda has expressed his determination to overcome deflation and often used the phrase “doing all that can be done.” Do you think there is a message for the Government in the use of such words?

CHIEF CABINET SECRETARY SUGA: He may have used such words, but I did not see the press conference myself. In any event, exiting from deflation is a priority for the Abe administration and the Government is engaged in efforts based on the firm belief that the only road forward is to implement the three arrows of Abenomics. The Government will continue to aim firmly in that direction.

REPORTER: I have a question on a different topic. Since last month coral poaching by vessels considered to have originated in China has become an issue, and there are concerns that the scope of the issue may be expanding from the waters off the Ogasawara Islands to the waters off the Izu Islands. What response is the Government making to this issue?

CHIEF CABINET SECRETARY SUGA: First of all, since September this year many fishing vessels that are suspected of being Chinese coral fishing vessels have been confirmed in the waters in the vicinity of the Ogasawara Islands. Yesterday an aircraft of the Japan Coast Guard (JCG) engaged in a patrol over the area. This patrol confirmed the presence of a total of 212 vessels that are viewed to have originated in China, in the waters off the Ogasawara Islands, as well as the waters off Smith Island and Tori Shima Island. The JCG has implemented a special intensive patrol structure around the Ogasawara Islands using large patrol vessels and aircraft, and is stepping up its efforts to crack down on foreign vessels engaged in illegal operations. As a result, on October 5, 16, 23, 27 and 30 the JCG patrol vessels on deployment apprehended and arrested the captains of Chinese coral fishing vessels. The Ministry of Foreign Affairs has raised this matter through diplomatic channels and has repeatedly issued expressions of regret to the Chinese side, in addition to strong requests for efforts to prevent reoccurrence of such incidents.

REPORTER: The joint meeting of the LDP’s Foreign Affairs Division and other Policy Divisions has confirmed the policy of protesting to China regarding this matter. At the current point does the Government have no intention to do any more than issue a protest through the Ministry of Foreign Affairs?

CHIEF CABINET SECRETARY SUGA: As I just noted, we have raised the matter through diplomatic channels and expressed regret to the Chinese side. In addition we have made strong requests for efforts to prevent reoccurrence of such incidents. The Government is resolved to resolutely protect Japan’s territorial land and waters.

(Abridged)

REPORTER: An explanatory meeting has been recently held for the families of the abduction victims, where the families expressed harsh opinions concerning the results of the recent Japan-North Korea intergovernmental consultations. Can I ask for your views on this outcome?

CHIEF CABINET SECRETARY SUGA: I think it is only natural that the families of the victims would express harsh opinions. However, from the outset these consultations were used as a means of strongly emphasizing to North Korea that the abduction issue is of top priority for Japan. Without such assertions it is unlikely that progress could be made. In that sense I believe that through the recent consultations we were able to convey the Government of Japan’s stance clearly to those in authority on the North Korean side. We carefully explained this to the families of the abduction victims.