Japan calls in experts for advice on economy

Associated Press

TOKYO

The scene: Prime Minister Shinzo Abe, the economy minister and top central banker receiving a lecture from Nobel laureate economist Joseph Stiglitz. The message: No matter how bad the debt, Japan’s economy is too weak to withstand another tax hike.

All is not well in the world’s third-largest economy, and Abe is seeking fresh advice from top experts, both foreign and Japanese, on what to do next.

Japan’s economy initially expanded under a policy mix dubbed “Abenomics” that included monetary easing and fiscal stimulus.

But China’s slowdown, weaker than hoped-for growth in other economies and lackluster spending by households and businesses have combined to keep Japan’s growth below forecasts. Cheaper oil prices have slowed progress toward a 2 percent inflation goal that Abe and his advisers say is needed to revive the “animal spirits” that would get growth back on track.