The new leader of a major business group has called for a public-private sector effort to rebuild small businesses harmed by the Great East Japan Earthquake.
The new leader of a major business group has called for a public-private sector effort to rebuild small businesses harmed by the Great East Japan Earthquake.
Yasuchika Hasegawa, who became chairman of Keizai Doyukai (Japan Association of Corporate Executives) on April 27, said the central and local governments, with participation by major corporations, should set up a holding company to aid the damaged firms.
Hasegawa, 64, president of Takeda Pharmaceutical Co., advocated a similar plan to support small businesses even before the March 11 disaster.
"Despite high technology and (quality) products, small and midsize enterprises across Japan have been unable to expand into growth markets overseas," Hasegawa told The Asahi Shimbun. "Like painting a picture on a white background, we can put the holding company proposal into practice in the quake-hit region ahead of other parts of Japan."
Excerpts from the interview follow:
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Question: How should Japan support companies in the quake-hit region?
Answer: We need to help rebuild small and midsize companies, which hold the key to the resurrection of the local economy.
Small businesses would become subsidiaries of the holding company through share swaps and other measures.
They would be able to solve problems they cannot on their own if they find partners among their ranks under the holding company.
Large corporations would send former employees and provide know-how.
Small businesses would be able to learn how to build sales channels overseas, increase means for raising funds and protect intellectual property rights--at lower costs than when they received such services individually.
Q: Given the tight state finances, how should Japan secure reconstruction costs?
A: Keizai Doyukai has proposed the government issue reconstruction bonds.
Moves are spreading nationwide to extend support to the quake-hit region. It is meaningful if the reconstruction bonds are purchased by individuals.
If the bonds are not enough to finance reconstruction, tax increases may be unavoidable.
But a public consensus will not be gained unless the government takes necessary steps, such as reviewing policy programs included in the Democratic Party of Japan manifesto.
Q: What types of taxes should be increased?
A: Personally, I think it is desirable to increase indirect taxes, whose revenues do not fluctuate much depending on economic conditions.
Some are opposed to the consumption tax hike because people in the quake-hit region will also shoulder the burden.
Should the consumption tax be raised, it should be treated as a tax for a specific purpose and the increased revenue should all be spent on reconstruction.