Naoto Kan, 63, is the latest prime minister to take a turn in the revolving door of Japanese politics after his deeply unpopular predecessor, Yukio Hatoyama, quit the post after less than 10 months in power. The quicker than anticipated handover is a chance for Japan to end a spending spree that is pushing the industrialised world's most indebted nation closer to insolvency.
The scale of Japan's overspending is immense. Dwindling tax revenue and costly election promises resulted in Mr Hatoyama this year committing his administration to borrow about US$500 billion (Dh1.83 trillion) to pay for his plans. The lending is equal in value to one-and-a-half times the Greek economy.
Japan's national debt, at near double GDP, amounts to more than $70,000 for every one of its citizens. Measured in ¥10,000 (Dh400.75) notes laid end-to-end, it would stretch to and from the moon at least 20 times.
The tighter stance on debt adopted by Mr Kan, therefore, is a relief. He is promising a timetable to cut borrowing and, unlike the spendthrift Mr Hatoyama, recognises that raising the nation's 5 per cent sales, or value-added, tax is inevitable. He also seems ready to halt plans to double a $140-a-month child benefit implemented by Mr Hatoyama's government at an annual cost of $22bn.
Japanese voters seem happy with the change in policy. In a poll published yesterday by the Asahi Shimbun, the nation's second-biggest daily newspaper, 43 per cent of respondents said they would support Mr Kan's Democratic Party of Japan (DPJ) in elections to pick lower house politicians on July 11. That support level compared with only 18 per cent who said they were ready to vote for the ruling party just before Mr Hatoyama quit.
Yet it would be a mistake to confuse Mr Kan for a fiscal conservative. He may seem a belt tightener compared with Mr Hatoyama, but he is not the spending hawk Japan needs.
So far, Mr Kan's modest proposal is to keep new borrowing under the record $500bn planned this year. Instead, he should reinstate a $330bn cap on new government bond issues imposed in 2001 by Junichiro Koizumi, the last prime minister to remain in office for more than a year. To do so would probably mean having to cut Mr Hatoyama's child allowance altogether. Neither could Mr Kan be timid about increasing Japan's sales tax. Each percentage point would add an estimated $28bn to state coffers and doubling the rate to 10 per cent or even tripling it to 15 per cent would go a long way in helping Japan to balance its books.
But no matter how bold Mr Kan wants to be, his party may not be as willing to embrace austerity. Mr Hatoyama resigned from government, but remains an influential member of the DPJ, a group he helped found. Mr Kan's choice of ministers, largely unchanged from Mr Hatoyama's cabinet, also suggests continuity rather than change.
Mr Kan has been head of the DPJ twice before, which means he is unlikely to bring many new ideas to the leadership post. He last resigned in 2004 over missed state pension contributions, shaved his head, donned Buddhist robes and set out on a pilgrimage to temples in western Japan.
So, Mr Kan may take his time tackling Japan's debt. The Asian economy's $15tn household asset cushion, after all, means most Japanese government debt is absorbed at home, letting it slip longer and deeper in debt than any European nation could. Yet, if Mr Kan does not act now, in five or 10 years the possibility of Japan's sovereign bankruptcy may not seem so far fetched. The crisis that engulfed Greece threw the EU into panic, wiped billions of dollars off stock values and raised a question mark over the global economic recovery. Any crisis of confidence over Japan's ability to pay back its loans would rip through global markets like a tsunami - a legacy Mr Kan or any other Japanese prime minister will want to avoid.
business@thenational.ae
RESULTS
6.30pm UAE 1000 Guineas Trial Conditions (TB) US$100,000 (Dirt) 1,400m
Winner Final Song, Christophe Soumillon (jockey), Saeed bin Suroor (trainer).
7.05pm Handicap (TB) $135,000 (Turf) 1,000m
Winner Almanaara, Dane O’Neill, Doug Watson.
7.40pm Handicap (TB) $175,000 (D) 1,900m
Winner Grand Argentier, Brett Doyle, Doug Watson.
8.15pm Meydan Challenge Listed Handicap (TB) $175,000 (T) 1,400m
Winner Major Partnership, Patrick Cosgrave, Saeed bin Suroor.
8.50pm Dubai Stakes Group 3 (TB) $200,000 (D) 1,200m
Winner Gladiator King, Mickael Barzalona, Satish Seemar.
9.25pm Dubai Racing Club Classic Listed Handicap (TB) $175,000 (T) 2,410m
Winner Universal Order, Richard Mullen, David Simcock.
ROUTE TO TITLE
Round 1: Beat Leolia Jeanjean 6-1, 6-2
Round 2: Beat Naomi Osaka 7-6, 1-6, 7-5
Round 3: Beat Marie Bouzkova 6-4, 6-2
Round 4: Beat Anastasia Potapova 6-0, 6-0
Quarter-final: Beat Marketa Vondrousova 6-0, 6-2
Semi-final: Beat Coco Gauff 6-2, 6-4
Final: Beat Jasmine Paolini 6-2, 6-2
COMPANY PROFILE
Company name: Almouneer
Started: 2017
Founders: Dr Noha Khater and Rania Kadry
Based: Egypt
Number of staff: 120
Investment: Bootstrapped, with support from Insead and Egyptian government, seed round of
$3.6 million led by Global Ventures
COMPANY PROFILE
Company name: Revibe
Started: 2022
Founders: Hamza Iraqui and Abdessamad Ben Zakour
Based: UAE
Industry: Refurbished electronics
Funds raised so far: $10m
Investors: Flat6Labs, Resonance and various others
MATCH INFO
What: India v Afghanistan, first Test
When: Starts Thursday
Where: M Chinnaswamy Stadium, Bengalaru
The Farewell
Director: Lulu Wang
Stars: Awkwafina, Zhao Shuzhen, Diana Lin, Tzi Ma
Four stars
Our legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
MEDIEVIL (1998)
Developer: SCE Studio Cambridge
Publisher: Sony Computer Entertainment
Console: PlayStation, PlayStation 4 and 5
Rating: 3.5/5
A meeting of young minds
The 3,494 entries for the 2019 Sharjah Children Biennial come from:
435 – UAE
2,000 – China
808 – United Kingdom
165 – Argentina
38 – Lebanon
16 – Saudi Arabia
16 – Bangladesh
6 – Ireland
3 – Egypt
3 – France
2 – Sudan
1 – Kuwait
1 – Australia
Company profile
Company name: Fasset
Started: 2019
Founders: Mohammad Raafi Hossain, Daniel Ahmed
Based: Dubai
Sector: FinTech
Initial investment: $2.45 million
Current number of staff: 86
Investment stage: Pre-series B
Investors: Investcorp, Liberty City Ventures, Fatima Gobi Ventures, Primal Capital, Wealthwell Ventures, FHS Capital, VN2 Capital, local family offices
Ramez Gab Min El Akher
Creator: Ramez Galal
Starring: Ramez Galal
Streaming on: MBC Shahid
Rating: 2.5/5
UAE Warriors fight card
Main Event
: Catchweight 165lb
Martun Mezhulmyan (ARM) v Acoidan Duque (ESP)
Co-Main Event
: Bantamweight
Felipe Pereira (BRA) v Azamat Kerefov (RUS)
Middleweight
Mohamad Osseili (LEB) v Amir Fazli (IRN)
Catchweight 161 lb
Zhu Rong (CHI) vs. Felipe Maia (BRA)
Catchweight 176 lb
Handesson Ferreira (BRA) vs. Ion Surdu (MDA)
Catchweight 168 lb
Artur Zaynukov (RUS) v Sargis Vardanyan (ARM)
Featherweight
Ilkhom Nazimov (UZB) v Khazar Rustamov (AZE)
Bantamweight
Jalal Al Daaja (JOR) v Mark Alcoba (PHI)
Lightweight
Jakhongir Jumaev (UZB) v Dylan Salvador (FRA)
Catchweight 143 lb
Hikaru Yoshino (JPN) v Djamal Rustem (TUR)
Featherweight
Javohir Imamov (UZB) v Ulan Tamgabaev (KAZ)
Catchweight 120 lb
Larissa Carvalho (BRA) v Elin Oberg (SWE)
Lightweight
Hussein Salem (IRQ) v Arlan Faurillo (PHI)
Confirmed bouts (more to be added)
Cory Sandhagen v Umar Nurmagomedov
Nick Diaz v Vicente Luque
Michael Chiesa v Tony Ferguson
Deiveson Figueiredo v Marlon Vera
Mackenzie Dern v Loopy Godinez
Tickets for the August 3 Fight Night, held in partnership with the Department of Culture and Tourism Abu Dhabi, went on sale earlier this month, through www.etihadarena.ae and www.ticketmaster.ae.
RESULT
Bayern Munich 3 Chelsea 2
Bayern: Rafinha (6'), Muller (12', 27')
Chelsea: Alonso (45'+3), Batshuayi (85')
Learn more about Qasr Al Hosn
In 2013, The National's History Project went beyond the walls to see what life was like living in Abu Dhabi's fabled fort:
Scores
Rajasthan Royals 160-8 (20 ov)
Kolkata Knight Riders 163-3 (18.5 ov)
The specs: 2018 Maserati Levante S
Price, base / as tested: Dh409,000 / Dh467,000
Engine: 3.0-litre V6
Transmission: Eight-speed automatic
Power: 430hp @ 5,750rpm
Torque: 580Nm @ 4,500rpm
Fuel economy, combined: 10.9L / 100km
The Baghdad Clock
Shahad Al Rawi, Oneworld
Fringe@Four Line-up
October 1 - Phil Nichol (stand-up comedy)
October 29 - Mandy Knight (stand-up comedy)
November 5 - Sinatra Raw (Fringe theatre)
November 8 - Imah Dumagay & Sundeep Fernandes (stand-up comedy)
November 13 - Gordon Southern (stand-up comedy)
November 22 - In Loyal Company (Fringe theatre)
November 29 - Peter Searles (comedy / theatre)
December 5 - Sinatra’s Christmas Under The Stars (music / dinner show)
Other key dates
-
Finals draw: December 2
-
Finals (including semi-finals and third-placed game): June 5–9, 2019
-
Euro 2020 play-off draw: November 22, 2019
-
Euro 2020 play-offs: March 26–31, 2020
Our family matters legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
The advice provided in our columns does not constitute legal advice and is provided for information only. Readers are encouraged to seek independent legal advice.
Profile Idealz
Company: Idealz
Founded: January 2018
Based: Dubai
Sector: E-commerce
Size: (employees): 22
Investors: Co-founders and Venture Partners (9 per cent)
The specs
Engine: 4.0-litre, flat six-cylinder
Transmission: seven-speed PDK
Power: 510hp
Torque: 470Nm
Price: from Dh634,200
On sale: now
The specs: 2019 Cadillac XT4
Price, base: Dh145,000
Engine: 2.0-litre turbocharged in-line four-cylinder engine
Transmission: Nine-speed automatic
Power: 237hp @ 5,000rpm
Torque: 350Nm @ 1,500rpm
Fuel economy, combined: 8.7L / 100km
Baby Driver
Director: Edgar Wright
Starring: Ansel Elgort, Kevin Spacey, Jamie Foxx, Lily James
Three and a half stars
If you go
The Flights
Emirates and Etihad fly direct to Johannesburg from Dubai and Abu Dhabi respectively. Economy return tickets cost from Dh2,650, including taxes.
The trip
Worldwide Motorhoming Holidays (worldwidemotorhomingholidays.co.uk) operates fly-drive motorhome holidays in eight destinations, including South Africa. Its 14-day Kruger and the Battlefields itinerary starts from Dh17,500, including campgrounds, excursions, unit hire and flights. Bobo Campers has a range of RVs for hire, including the 4-berth Discoverer 4 from Dh600 per day.
yallacompare profile
Date of launch: 2014
Founder: Jon Richards, founder and chief executive; Samer Chebab, co-founder and chief operating officer, and Jonathan Rawlings, co-founder and chief financial officer
Based: Media City, Dubai
Sector: Financial services
Size: 120 employees
Investors: 2014: $500,000 in a seed round led by Mulverhill Associates; 2015: $3m in Series A funding led by STC Ventures (managed by Iris Capital), Wamda and Dubai Silicon Oasis Authority; 2019: $8m in Series B funding with the same investors as Series A along with Precinct Partners, Saned and Argo Ventures (the VC arm of multinational insurer Argo Group)