Executives' Comments  Press Conferences   Chairman Sakakibara's Statements and Comments
at His Press Conference

May 9, 2016

Exchange Rate

I perceive that the recent all too sharp rise of the yen deviates from the real economy and is due to speculative moves. It is a matter of course that financial authorities put a brake on these moves. Minister of Finance Taro Aso has stated that the government stands ready to conduct exchange rate intervention. Should the Ministry of Finance and the Bank of Japan intervene in the currency market, the business community would support their judgement. It is important that a stable exchange rate be maintained at a level reflecting economic fundamentals.

G7 Ise-Shima Summit

I consider that Prime Minister Shinzo Abe's recent visit to Europe ahead of the G7 Ise-Shima Summit was a very meaningful visit. Prime Minister Abe stated that he and the leaders he met agreed on the importance of promoting well-balanced cooperation on monetary policy, flexible fiscal policy, and structural reforms while reflecting the situation of each country. In that regard, I believe that thorough preparations were made for the upcoming G7 Summit.

At the recent B7 Tokyo Summit, the business leaders of the G7 countries and the EU shared the view that the G7 needs to exercise leadership and drive the world economy, in order to end the current stagnation of the economy and realize sustainable and robust economic growth. On this basis, the B7 compiled and presented to Prime Minister Abe joint recommendations containing the text: "It is imperative for the G7 to not rely solely on monetary policy but to implement flexible fiscal policy in accordance with the economic situation while ensuring sustainability. Also, from the perspective of achieving a resilient economy, it is indispensable for each G7 country to carry out fearless structural reforms." I hope that the G7 Summit presents a policy direction based on this view of the B7, and demonstrates a resolve to become the driving force of stable and sustainable world economic growth. The G7 is capable of coordinating to set out such a policy, and I expect that it will.

U.S. Presidential Election

It is all but certain that Mr. Donald Trump will win the nomination to be the Republican presidential candidate. It is a wonder that Mr. Trump who sets out extreme policies and political approaches can gain strong support in the United States today. Although this is attributed mainly to strong dissatisfaction with the Republican party's policies of free trade, free competition, and self-responsibility, especially among the low-income white population, it is hard to imagine that this alone explains Mr. Trump's broad support. I will try to fully understand the present situation of the United States.

I understand that there is considerable antipathy to Mr. Trump's extreme remarks even within the Republican party. Seeing as how Mr. Trump has said that an incumbent politician would be selected as his vice presidential candidate, his election platform may become a little more reasonable in the lead-up to the final phase of the presidential election. If Mr. Trump's extreme claims become U.S. policies, then this would inevitably cause tension and turmoil. However, I will avoid forming opinions until I have looked at Mr. Trump's public pledges.

Japan-Russia Relations

Prime Minister Abe visited Sochi and held an informal meeting with President Vladimir Putin. This was the 13th meeting between the two leaders since the inauguration of the first Abe Cabinet. There is important significance to both countries in building close ties between the two political leaders.

The negotiations for concluding a peace treaty have stalled. Under these circumstances, it is understandable that Prime Minister Abe has proposed to carry out negotiations under a new approach, not bounded by past ideas, as the Prime Minister has stated. I understand that another summit meeting will be held in Vladivostok in September. I expect that the two leaders will continue to make persistent efforts to arrive at a desirable way forward.

In June, Keidanren will dispatch a mission to Moscow, led by Chair Teruo Asada of the Japan-Russia Business Cooperation Committee, and continue its business dialogues with Russia. The Russian economy has many untapped sectors and has a lot of potential. The business community will answer to the efforts of the government and work to develop mutually beneficial and multifaceted economic relations between Japan and Russia.

Acceptance of Foreign Human Resources

It is essential that more foreign human resources are accepted to maintain and bolster the vitality of the Japanese economy and society. In particular, there is already a global competition for skilled talents, making it a critical issue that industries acquire competent engineers and specialists. It is imperative that an environment be created where skilled foreign talents can freely unleash their potential. In addition, general immigration issues need not be discussed urgently, but at the same time, they should not be shelved and need to be discussed as challenges of the future.

Panama Papers and Tax Evasion

Generally speaking, obviously there should be crackdown on illegal tax evasion. Even if it is legal, excessive tax reduction should be avoided. In particular, political leaders who lead the nation and the people are demanded to renew their commitment to combat tax evasion. Furthermore, as was affirmed at the recent G20 Finance Ministers and Central Bank Governors Meeting, countries and regions like Panama that have inadequate requirements for tax information disclosure must increase their tax transparency.

Corporate Governance

With regard to corporate governance, there is no such thing as a good approach or a bad approach. It is important that companies adopt an approach that is suited to their situation. In recent weeks, the presidents of Toshiba Corporation and Seven & i Holdings Co., Ltd. were nominated in a highly open and objective process, with their nominating committees playing a leading role. These appointments can be praised as representing one way of nominating presidents. In particular, the nomination process at Toshiba was carried out in a socially convincing manner.

International Bids for the Joint Development
of the Next-Generation Submarines of Australia

It is regrettable that Japan was not chosen as the partner to jointly develop the next-generation submarines of Australia. The Japanese government should analyze and study the causes of this, and establish a strategy for winning the contracts of international joint development and production projects. The business community will cooperate in this effort.

The Cabinet decision of two years ago has enabled the overseas transfer of defense equipment under certain conditions. Specifically, the transfer of defense equipment is permitted in cases where it contributes to Japan's proactive promotion of peace contribution and international cooperation, or in cases where the transfer contributes to the security of Japan. The transfer of defense equipment is something that the private sector cannot do alone. It requires the public and private sectors to collaborate and to appropriately divide roles and risks among them, with the government playing a leading role.