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Japan’s economy to recover to pre-pandemic levels in 2022, Bank of Japan’s Kuroda says – The Globe and Mail

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Bank of Japan Governor Haruhiko Kuroda attends a news conference at the BOJ headquarters in Tokyo, Japan, on July 30, 2019.

KIM KYUNG-HOON/Reuters

Japan’s economy will likely recover to levels before the coronavirus pandemic as early as March next year, Bank of Japan Governor Haruhiko Kuroda said on Monday, offering an upbeat view on its recovery prospect despite headwinds from COVID-19.

Kuroda also said a combination of expansionary fiscal and monetary policies have successfully stabilized Japan’s economy, signalling that the BOJ has offered sufficient stimulus for now to cushion the economic blow from the health crisis.

“Both fiscal and monetary policies have been successful in preventing corporate failures and unemployment,” Kuroda told a virtual meeting of the World Economic Forum.

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“We expect, probably by the end of fiscal 2021 or early fiscal 2022, that Japan’s economy would recover and come back to levels before the pandemic started,” he said.

In its latest quarterly projections released last week, the BOJ expects the world’s third-largest economy to expand 3.9% in the fiscal year beginning in April, followed by a 1.8% increase in fiscal 2022.

The key challenge for policy-makers would be to prevent the pandemic from leaving a lasting scar on the economy, and to provide impetus to growth such as by promoting digitalization and a “green” economy, Kuroda said.

“Greening the economy…was important before the pandemic. But now it’s more important. It would make our economy more sustainable. At the same time, it would provide some growth impetus,” he said.

After suffering its biggest postwar slump in April-June last year, Japan’s economy has been recovering moderately from the pandemic thanks to a rebound in exports and output.

But a resurgence in infections has forced the government to declare a new state of emergency in January, threatening to cool consumption and push the economy back into recession.

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Economy

Covid has hit China's economy harder than expected – CNN

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11 hours ago

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May 16, 2022

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Hong Kong (CNN Business)China has reported disappointing economic data for the month of April, underscoring the extensive damage Covid lockdowns have wreaked on the country.

The world’s second largest economy reported shocking drops in retail sales and factory production, widely missing market expectations.
Retail sales plunged 11.1% in April from a year ago, according to China’s National Bureau of Statistics on Monday. That was well below the 6.1% drop forecast in a Reuters survey of economists, and also much lower than the 3.5% decrease seen in March.
A man walks his dog through the nearly empty courtyard of the usually bustling Taikoo Li mall in Sanlitun after many retail stores were closed to help prevent the spread of COVID-19 on May 10, 2022 in Beijing, China.

A man walks his dog through the nearly empty courtyard of the usually bustling Taikoo Li mall in Sanlitun after many retail stores were closed to help prevent the spread of COVID-19 on May 10, 2022 in Beijing, China.

A man walks his dog through the nearly empty courtyard of the usually bustling Taikoo Li mall in Sanlitun after many retail stores were closed to help prevent the spread of COVID-19 on May 10, 2022 in Beijing, China.
Industrial production fell 2.9% last month from a year earlier, reversing a 5% gain in March.
This marks the worst contraction in industrial production since February 2020, when China’s economy came to a near standstill during the initial coronavirus outbreak.
Unemployment also surged to the second highest level on record.
The urban jobless rate hit 6.1% in April, up from 5.8% in March — which was already at a 21-month high. The only time China’s jobless rate was higher was in February 2020.
Young people have been finding it especially hard to find jobs, the data showed, with the unemployment rate for those between 16 to 24 years of age rising to 18.2% — the highest ever.
Rising unemployment is a warning sign for the ruling Communist Party given the risk of social and political instability.
“After all, zero-Covid at the cost of surging unemployment is a hard sell politically,” said Larry Hu, chief China economist for Macquarie Capital.
The government expects the economy to rebound this month.
“Economic performance” in May will improve, said NBS spokesperson Fu Linghui on Monday.
“As the outbreaks are under control and people’s life return to normal, pent-up consumption will be gradually released,” he said.
Increased investment in infrastructure projects will also support the recovery, he added.

Hefty blow

China’s economy was off to a solid start in 2022, recording 4.8% growth for the first quarter.
But Beijing’s efforts to curb its worst Covid outbreak in two years have dealt a hefty blow to activity since March, and economists now expect GDP to shrink this quarter.
So far, at least 31 cities in the country remain under full or partial lockdown, according to CNN’s latest calculations. Shanghai, the country’s financial center and a manufacturing hub, has been under lockdown for more than six weeks. During this period, many companies have been forced to suspend operations, including automakers Tesla (TSLA)and Volkswagen (VLKAF) and iPhone assembler Pegatron.
“We think Q2 GDP growth will likely turn negative,” said Zhiwei Zhang, president and chief economist for Pinpoint Asset Management, on Monday.
“The government faces mounting pressure to launch new stimulus to stabilize the economy,” Zhang said.
The leadership in China is aware of the economic pains and has taken some steps recently to bring relief.
The People’s Bank of China announced Sunday that it would cut the mortgage rate for first-time homebuyers, in a move to lift the ailing property market.
Separately, the Shanghai government said the city will gradually open shops, restaurants, and salons from Monday, which will be a relief for its 25 million residents.
The government has also recently pledged to prop up the economy through more infrastructure spending and targeted monetary easing to support small businesses.
Monday’s data showed investments in manufacturing increased 12.2% from a year ago. Infrastructure investment, meanwhile, rose 6.5%.
But “the risks to the outlook are tilted to the downside, as the effectiveness of policy stimulus will largely depend on the scale of future Covid outbreaks and lockdowns,” said Tommy Wu, lead China economist for Oxford Economics, on Monday.
“We forecast GDP to grow 4% this year, with a quarterly contraction in the second quarter before returning to growth in the second half.”
— CNN’s Beijing bureau contributed to this report.

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US Recession Risk, Wheat Watch, Chinese Economy Jolt: Eco Day – Bloomberg

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12 hours ago

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May 16, 2022

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US Recession Risk, Wheat Watch, Chinese Economy Jolt: Eco Day  Bloomberg



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Rural development grants to spark Nicola Valley economy – Global News

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23 hours ago

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May 15, 2022

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The province announced on Friday a series of rural development grants in the Nicola Valley to support economic development and diversification.

This is the next step in the StrongerBC Economic Plan and the ongoing recovery efforts in Merritt following the floods in November last year.

“People in Merritt have been through a lot in the past year, and they know how important business recovery is for community rebuilding,” said parliamentary secretary for rural and regional development Roly Russell in a press release.

The provincial government is providing a $1-million rural development grant to the Small-Scale Meat Producers Association to build a community abattoir in the Merritt area.

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B.C. announces $228M to help farmers, ranchers impacted by floods

This will provide meat processing and cut-and-wrap services to local farmers and ranchers.

“This project represents significant job and economic opportunities for the region, while ensuring local ranches, abattoirs and businesses are part of a strong, resilient B.C. food system,” said minister of agriculture and food Lana Popham in a press release.

“With the recent changes to B.C.’s meat-licensing system and investments in facilities like the Nicola Valley community abattoir, this revitalization of the small-scale meat industry makes it easier to produce, buy and sell B.C. meat in our rural communities, and helps strengthen our food security and food resiliency.”

The abattoir will be a government-inspected licensed facility with a full range of services to process red meat.

According to the province, local producers have been impacted by the lack of processing capacity. Julia Smith who is a pork and beef producer in Merrit is hopeful this new facility will help her business as well as other local producers.

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“My partner and I moved to the Nicola Valley in 2016 planning to expand our business to meet the growing demand for well-raised, local meat. But we soon found that the processors we relied upon were not able to keep up with our production and we had to scale the business back instead of growing it.”


Click to play video: 'More than 900 people still displaced following Merritt flooding last fall'



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More than 900 people still displaced following Merritt flooding last fall


More than 900 people still displaced following Merritt flooding last fall – Feb 25, 2022

“We were on the verge of giving up. But now we are ready to press on, because this facility will allow us, and other local family farms and ranches, to grow and thrive while providing greater food security for the community.”

The province is providing a $1-million rural development grant to the Scw’exmx Tribal Council toward Gateway 286 in Merritt.

“After an unbelievable year of fires, floods, and a pandemic, we welcome the B.C. government’s $1-million grant that will bolster our rural community, support good-paying jobs and much-needed economic development,” said Spayum Holdings LP director and Scw’exmx Tribal Council Terrence (Lee) Spahan in a press release.

“The Gateway 286 project is a 30-plus-year vision of past and present Nicola Valley Indigenous Chiefs and these monies will take our commercial and tourism development one more step closer to reality. This project will enhance the experience of the [traveling] public by providing much-needed services, and it will provide good-paying jobs and entrepreneurial opportunities for the residents of the Nicola Valley.”

Meanwhile, the City of Merritt is receiving a $500,000 grant related to economic recovery for communities that were affected by the flooding. The grant will go towards completing economic development projects and initiatives to support long-term economic recovery.

This is in addition to $329,000 in provincial funding for the City of Merritt to update flood-hazard mapping and develop new flood-mitigation plans.


Click to play video: 'Anger grows over Merritt evacuations'



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Anger grows over Merritt evacuations


Anger grows over Merritt evacuations – Nov 28, 2021

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