Japan is about to emerge from the bad loan crisis that shackled its economy for more than a decade and is set to mark stable growth through economic reforms such as the privatization of the cash-rich postal system, the economy minister said yesterday.
Economy Minister Heizo Takenaka, who is also in charge of postal privatization, made the remarks in a policy speech before Parliament, which opened yesterday for a session through June.
He said Japan was well on its way to grow about 2.1 percent for this fiscal year ending March 31, and would continue to eke out 1.6 percent growth in fiscal 2005, which ends March 31 next year.
For more than 10 years, ever since the speculative "bubble" burst, Japan has been slipping into periods of contraction after briefly posting moderate growth. But hopes have grown in the last couple of years that the worst may be over for the world's second largest economy.
Takenaka noted that the massive bad loans racked up by the nation's banks, which had crippled economic growth for years, have been reduced. Corporate profitability is also improving, he said.
"Now that the end of the problem of bad loans is in sight, I want to say clearly that we are no longer stuck in a post-bubble economy," Takenaka told lawmakers.
Takanaka said he is committed to the administration's program for privatizing the postal system, which he praised as a symbol of Japan's move toward a free-market economy.
Japan has relied on government controls during the decades of modernization. But as the world economy grows increasingly global, the government has been trying to reduce regulations and allow a freer market to keep growth going.
With some ?340 trillion (US$3.3 trillion) in savings deposits and insurance assets, Japan Post is the world's largest bank.