As new orders for his hydraulic cylinders pile in, factory owner Kazushi Nomura says he is hopeful Japan's economy may be headed for a solid recovery.
Prime Minister Shinzo Abe's grand plans for getting Japan's growth back on track after two decades of stagnation, endorsed by his Cabinet today, depend on convincing businessmen like Nomura to invest in that recovery.
Nomura's Nambu Co makes cylinders used mainly to make auto engines and roll steel sheets. He's expanded into Thailand and China, where auto sales have boomed in recent years, and is considering setting up factories in India and Mexico.
In Japan, he says, he hasn't bought new equipment in five years.
"The growth is all in overseas markets. The consumer base is shrinking here as society ages," said Nomura, 74, during a recent visit to his factory, a collection of tiny buildings crammed inside part of a city block in Tokyo's Ota Ward, a fading industrial district whose small workshops and factories are steadily giving way to apartments.
Abe's Cabinet approved a blueprint for reforms today meant to improve Japan's competitiveness and shore up long-term growth in the world's third-largest economy as its population ages and shrinks.
"At last the time for action has come. Without action there can be no growth," Abe said in a video message released today after the Cabinet meeting.
Abe has claimed early progress in countering the stagnation that has hobbled growth for more than 20 years through an onslaught of monetary and fiscal stimulus, after the economy grew 4.1 per cent in January-March.
But economists say deeper, more far-reaching changes are needed to ensure the economy keeps growing.
