The Pope’s Nuclear Option For Japan’s Troubled Economy

29-Nov-2019 Intellasia | Forbes | 6:02 AM Print This Post

Pope Francis, economic strategist? Japanese policymakers are indeed having a come-to-Jesus moment this week following the pontiff’s stated disdain for Tokyo’s favourite energy source.

In visiting Japan, Francis made a point of dropping in on Hiroshima and Nagasaki, two cities devastated by atomic bombs 70-plus years ago. There, he condemned the evils of weapons, calling them “a crime not only against the dignity of human beings but against any possible future for our common home.

What got economists’ attention, though, was the pope’s denunciation of the nuclear power industry and its “selfish decisions,” too. He came perilously close, at least for the pro-reactor crowd, to calling for the abolition of nuclear power.

It’s the last thing host Shinzo Abe wanted to hear from the leader of the world’s roughly 1.2 billion Catholics. Arguably no developed economy has hitched its fortunes more closely to nuclear power than Japan. Since becoming prime minister in 2012, Abe spent vast amounts of time, energy and political capital on restarting reactors shuttered after the Fukushima mess.

To be sure, the pope isn’t shilling for producers of safer renewable energies. Nor is he necessarily speaking the language of job creation and stock valuations. But he reminded Japan it’s squandering a glaringly obvious economic opportunity: becoming the globe’s premier incubator for new energy sources.

Since 2012, Abe has empowered the Bank of Japan to pump trillions of dollars into an aging and uncompetitive economy. The BOJ cornered the bond market and commandeered equities via epic purchases of exchange-traded funds. By the end of 2018, the BOJ’s balance sheet exceeded the size of Japan’s entire $5 trillion economy, a first for a Group of Seven nation.


Category: Japan

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