When Prime Minister Shinzo Abe returned to office in December 2012, the core of his programme consisted of relaunching Japan's economy which has been stagnating for more than 20 years in a deflationary trap, writes Prince Michael of Liechtenstein.
His programme consisted of a number of ‘arrows’ - measures to fix the economy - which were called ‘Abenomics’.
The first two arrows covered monetary and fiscal measures to create a feel-good economy. The third, introduced in mid-2014, helps some vested industries. These measures keep Mr Abe's voters happy and should ensure his re-election 2016.
Real reforms, such as decentralisation, liberalisation and deregulation have been avoided.
Prime Minister Abe has been in office for nearly two years. The positive effects of Abenomics have not shown in the real economy, apart from gains in the stock market and property prices.
These measures follow the same politics as European governments such as Italy and France are trying out, supported, but not openly admitted, by the European Central Bank.
GIS expert Professor Stefan Lippert warned us to be wary of expectations from Abenomics nearly two years ago.
- The big economic challenges facing Japan's new government in 2013
- Japan's weaker Yen policy increases its trade deficit
- The rewards and risks of Japan's 'Abenomics' revival
GIS also cautioned about the European economic, fiscal and monetary policy. GIS suggested that the Japanese experience could help Europe avoid the same mistakes.
But it appears that European politics is following Japan’s route into a long period of stagnation and even recession.
One mistake can be forgiven. Repeating the obvious mistakes of others is irresponsible and just plain stupid.
Deliberately ignoring the facts or being blinkered to the outcome shows a lack of political courage and is a breach of the voters’ trust.