Japanese Prime Minister Fumio Kishida apologized for the government’s mishandling of economic data after media reports said that it had for years overstated construction order figures, a key number set used to calculate economic growth.
“This is extremely regrettable and we need to examine how it occurred to ensure it doesn’t happen again,” Kishida told the National Diet yesterday.
The Japanese Ministry of Land, Infrastructure, Transport and Tourism has been double counting some data in its monthly construction orders survey, Japan Broadcasting Corp reported, citing unidentified people familiar with the matter.
Photo: EPA-EFE
The monthly release of orders from about 12,000 contractors is of particular importance for the government, given that it feeds directly into the calculation of GDP.
The overstating of the data goes back as far as eight years, the Asahi newspaper reported.
Kishida told lawmakers that the ministry had corrected last year’s figures.
It is not the first time Japan has mishandled data — the Japanese Ministry of Health Labor and Welfare published erroneous wage figures in 2018, leading to a massive reassessment of other economic releases.
“The accuracy of data is an important issue we need to take seriously,” Kishida said.
Japan said in 2019 that it would review the handling of all of its economic statistics after incomplete wage data saw it shortchange about 20 million welfare recipients by about US$525 million.
While it is still unclear how much data revision might have occured this time from the overstated construction figures, IHS Markit economist Harumi Taguchi said that developments point to strains in Japan’s system to collect statistics.
“We’ve already had this problem in the past with wages data, but we need to ask why do these things happen, how was it not noticed for so long and why haven’t past problems led to improvements?” Taguchi said. “Unless the country becomes really serious about this, the system will face institutional fatigue.”
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