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Editorial
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June 2000 Issue the bulletin Information technology will put Japan's economy back on a path of self-sustaining
growth, Chairman and Chief Executive of the Japan External Trade Organisation (JETRO)
Noboru Hatakeyama (right) told the business community at the Chamber's May 17 luncheon. "Technology has already started bearing the fruits in Japan. So self-sustaining recovery is not just a hope, but will become a reality soon," he said. Investments in information technology industries will drive the recovery. In the 1st quarter of 2000, IT industries accounted for 1.4 per cent or more than half of the 2.2 per cent increase in production, he said. New job offers in IT related service industries also showed encouraging signs of recovery. New economy job offers increased by 21.5 per cent in January 2000, compared to the same period last year. "That is far higher than the old industry average of 11 per cent in January 1999," he said. Mr Hatakeyama said he expects industrial production in the first quarter of this year to grow 6.5 per cent, compared with the same period last year, and 8.6 per cent by the end of the second quarter. Industrial production accounts for about 30 per cent of Japan's GDP. Therefore, even if non-industrial production finished flat, overall economic growth for the first and second quarters would reach 2 and 2.5 per cent respectively, he said. Mr Hatakeyama said two signs -- capital investment and a growth in private consumption -- also indicated the growth was solid. For the first time since the 4th quarter of 1997, non-residential investment grew by 3.1 per cent in the 4th quarter of 1999, while consumption rose 0.1 per cent during the same period, he said. Since the beginning of 2000, car sales in the country have risen for three consecutive months. Sales of consumer appliances -- centring on personal computers -- also rose significantly, he added. Based on the recovery, the Japanese Government put the country's GDP forecast for 2000 at 1 per cent, he said, but "I personally think the growth rate for 2000 will be more than 1.5 per cent." Appreciation of the yen, or a sudden plunge in stock prices in the United States could put downward pressure on the recovery, but the probability of this happening is low, Mr Hatakeyama said. Even if the U.S. Federal Reserve added 0.5 percentage points to its interest rates, the impact of yen would be limited as long as it remained in the 110-105 range, he said. ?@ ?@ |
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