Who Can Follow Koizumi?
Thursday, July 06, 2006JEFF YASTINE: Japan`s most controversial and effective prime minister in recent history is about to step down. Junichiro Koizumi will be a tough act to follow and the buzz in Tokyo is whether any replacement can possibly measure up. Lucy Craft has this report.
LUCY CRAFT, NIGHTLY BUSINESS REPORT CORRESPONDENT: Japan is headed down an unknown road. In late September, a new prime minister will take office for the first time in five years. He`ll replace a maverick`s maverick, Junichiro Koizumi, who cheerfully laid waste to his own party machine as he yanked the country out of recession hell.
ROBERT FELDMAN, CHIEF ECONOMIST, MORGAN STANLEY JAPAN: The metabolism in the land market, in the financial markets, is tremendously improved. So that`s probably the biggest difference. We`ve had reform of the postal savings system. We`ve now had legislation passed on medical reform, on agricultural reform, on government financial institution reform, on pension reform. There`s been this whole swath of reform plans that have generated new business opportunities as well.
CRAFT: Slimmed-down companies are more productive than ever. Average real growth humming at almost 3 percent and most of that`s from homegrown demand, not exports. The can-do spirit has infected a confident new breed of entrepreneurs and society at large.
GERALD CURTIS, PROFESSOR OF POLITICAL SCIENCE, COLUMBIA UNIVERSITY: I think the main point is that the mood is up.
CRAFT: Japan`s next leader will be anointed from within Koizumi`s own conservative party. Already, epitaphs are being written for the era of aggressive reform.
CURTIS: No one can copy Koizumi. No one can be that kind of leader. He`s a one-time phenomenon.
CRAFT: But not everyone agrees. The next prime minister is likely to be a man from Koizumi`s inner circle, 51-year-old Shinzo Abe. Fans of Abe- san, as he`s known, insist the presumed heir will stay the course on making Japan more market-friendly.
YOSHITO HORI, DEAN, GLOBIS MANAGEMENT SCHOOL: I believe that when Abe- san takes over, I`m sure he will continue to do the reform and might be able to do a much better job than Koizumi-san, because all the people that Koizumi-san behind.
CRAFT: But Abe, a nationalist who has led negotiations with North Korea, is not known as a political insider.
CURTIS: As talented as he may be, he`s not going to be as effective as Koizumi and he will suffer by the comparison. That`ll be true for no matter who becomes prime minister.
CRAFT: Observers say Abe will have to prove he`s willing to take the gloves off when it comes to reform.
FELDMAN: He`s going to have to knock heads, say the way Reagan did with the air traffic controllers, to make it clear that this is the direction the country`s going to go.
CRAFT: Japan is in hock to the tune of nearly $7 trillion. As a ratio of gross domestic product, that`s the worst for any industrialized country. Cutting spending without derailing Japan`s recovery will top the to-do list for Japan`s next prime minister. Lucy Craft, NIGHTLY BUSINESS REPORT, Tokyo.
