Press Conference by Taro Aso, Deputy Prime Minister, Minister of Finance, and Minister of State for Financial Services


(Tuesday, August 2, 2016, 10:42 am to 10:47 am)

[Questions and answers:]


I understand that, to prepare against the risks of Brexit, a British exit from the EU, the government and the ruling coalition will incorporate a framework for injecting public funds in line with the Act on Special Measures for Strengthening Financial Functions as well as an extension of purchases of bank-held shares into the economic countermeasures they are now finalizing. In this context, what possible risks do you see facing local financial institutions and local economies in future? Also, I would appreciate hearing your views on whether extending current measures is a sufficient response.


While such structural factors as a declining birthrate, an aging population and declining economic growth potential are present, in this context I think current economic conditions are improving in terms of employment, income and so on, although I also think that personal consumption and capital investment by private companies are lacking steam. Another issue is the various indications of economic weakening in a number of emerging countries. In the wake of the UK national referendum to intend to leave the EU, there is talk that this will lead to a slump in demand and that cars produced in the UK for export to Europe could be subjected, as things stand now, to a tax of 10% or 11%, seriously hampering sales of British vehicles. So many things have yet to be worked out, but there is the risk of a slowdown. A sudden turn for the worse in financial and economic circumstances would especially impact cash flow at small and micro enterprises, so I think that we need to ensure that intermediary functions are in place. Accordingly I have instructed officials to be ready to do whatever is necessary, but I will refrain at this stage from commenting on specific details.

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