Executives' Comments Press Conferences
Chairman Sakakibara's Statements and Comments
at His Press Conference
As Chairman of Keidanren, a member of the Council on Economic and Fiscal Policy, and Chair of the Council on Fiscal System Council, I believe it is essential to achieve a budget surplus in the primary balance by fiscal 2020, and I do not think we should abandon this goal. A primary balance deficit in our times will cast a shadow of burden over future taxpayers, and we have a duty to ensure a budget surplus for the sake of generations to come. A budget surplus is also crucial to earning international trust in Japan and its national economy. This view is shared by Keidanren executives. The government's fiscal discipline targets include lowering the debt-to-GDP ratio, and to reach this goal it is essential to pursue a budget surplus without being distracted by future interest rates or nominal growth rates. Working toward a budget surplus is the primary consideration for fiscal restructuring.
US Withdrawal from Paris Agreement
President Trump has announced that the United States will withdraw from the Paris Agreement on climate change, but the US business community has shown willingness to proceed with its own efforts to curb greenhouse gases (GHGs). Japan and the US have world-class environmental technologies, and need to explore ways of cooperating to reduce global GHG emissions. I understand that various partnerships are already under way in fields including renewable energy, nuclear power, and coal-fired thermal generation, and such industry- and enterprise-level initiatives will become more important than ever.
As a percentage of GDP, public expenditures for education in Japan have trended below the average for OECD member-nations, and investing more in education has become a challenge. The cost burden of education is also a factor behind the falling birth rate and sluggish consumption. Moreover, parents' income levels sometimes restrict freedom of choice in education, and this situation needs to be remedied to create equal educational opportunities.
Various proposals for financing education are currently being put forward, but Keidanren's position is that tax revenues should be the prime source of funding for education in Japan. In particular, as noted in the proposals we announced in April, we believe that a cautious approach is required to the notion of "children's insurance," namely, increasing social insurance premiums as a way of generating more revenue to fund education.
To ensure equal educational opportunities, it is important to support low income earners, large families, and single-parent households at the preschool and elementary stages. Support should not be offered indiscriminately to all families without setting income caps. Similarly, support for higher education needs to focus on students with genuine motivation and capability by expanding grant-type scholarships, rather than enabling all students who want to study at university to do so free of charge.