Japanese Official Optimistic about Economic Recovery

A senior official from the Japanese Ministry of Foreign Affairs says the country's economy will see a recovery this year following the country's devastating earthquake.

In the meantime, the Japanese government is discussing a supplementary budget of several trillion yen for reconstruction work.

Our reporter Zhang Cheng has more.

At the Boao Forum, Hideaki Domichi,a senior official with the Japanese Foreign Ministry, discussed the earthquake's impact on Japan's economy.

"Japan's economic losses are about 16 to 25 trillion yen. The earthquake heavily damaged the vehicle industry in northeast Japan. The supply chain has been partly broken, and the shortage of electricity in the northeast will last until this summer."

Hideaki said a downward trend exists in Japan's production industry, but as roads and railways are being repaired, it is hoped that the production chain will be smooth in June or July.

He also said he was optimistic that Japan's economy would be on the recovery track this year, as the country's production and supply chains recover.

Hideaki made the remarks at the forum called "Rediscover the Growth Potential of Japan."

Government officials, entrepreneurs and scholars joined the discussion to share their thoughts about Japan's post-quake economic recovery.

Akio Mimura, Chairman of Nippon Steel Corporation, said Japan's severe fiscal deficit would drag down the pace of Japan's economic recovery.

He said he doubted Japan's ability to issue a large stimulus package for reconstruction under such circumstances and insisted on levying more taxes.

"Rather than thinking about today's happiness, we should think about the future. That is to say, we should be forward-looking to solve the huge fiscal deficit through increasing taxes. By doing so, the government, in the longer term, is capable of supporting Japan's reconstruction work and enterprises."

Haruhiko Hirate, Senior Vice President of Takeda Pharmaceutical, said a long-term strategy is crucial for economic recovery.

"Japan should have more strategic plans to guide the recovery from both the country level and enterprise level. China has a plan for every five years. Japan can also have one. Until now, Japan only has an annual development plan in which enterprises can't clearly see the development direction of the country and opportunities to invest."

Attendees at the forum believe despite the current economic depression, there is no reason to underestimate Japan's potential in technology and human resources.

They believe Japanese experiences in innovation, management and corporate culture are still valued and emulated in many ways, which will help Japan's economic recovery in the long term.

For CRI, I'm Zhang Cheng, in Boao.