日本经济和货币政策在静冈地方领导人会议上的讲话

February2,2023JapansEconomyandMonetaryPolicySpeechataMeetingwithLocalLeadersinShizuokaWAKATABEMasazumiDeputyGovernoroftheBankofJapanshtranslationbasedontheJapaneseoriginal1ionItismygreatpleasuretohavetheopportunitytodaytoexchangeviewswithleadersinthethischancetoexpressmysinceregratitudeforyourcooperationandsupportwiththeactivitiesoftheBankofJapan'sShizuokaBranch.spotlightinthisyear'sNHKTaigaDrama(theannualyear-longhistoricaldramatelevisionseriesproducedbyNHK[JapanBroadcastingCorporation]).HewasthefirstShogunofthewhereoneofthekinzacalledSurugakobanzawasbased,asissuggestedbyitsJapanesenameThekinzawassubsequentlymovedtoEdonowTokyo,andtheBank'scurrentHeadadalreadystartedtoemergeduringtheEdoperiodInasense,thekinzaplayedtheroleoftheBankofJapantosomeextentatthetimeoftheEdoShogunate.1Turningtothepresentpricedevelopments,theinflationrateshavebeenincreasinginJapansustainableandstablemannerforalongtime.Isthistimeanydifferent?Willthepricestabilitytargetof2percentbeachieved?Inanutshell,althoughthecurrentsituationdifferseseeninthepastthereareextremelyhighuncertaintiesoverfuturedevelopmentsandIbelievethatitisnecessarytocontinuepursuingmonetaryeasingsteadilyinordertoievethepricestabilitytargetinasustainableandstablemanneractivityandpricesbasedontheOutlookforEconomicActivityandPrices(OutlookReport)thatwasreleasedrecently.Theessenceisthat,whileJapan'seconomyislikelytorecover,inflationisexpectedtoberelativelyhighintheshortrunandthendecelerate(Chart1).OnurugakobanzatoNipponGinkSurugaovalgoldcoinmintandtheBankofJapan],September2015,https://www3.boj.or.jp/shizuoka/gaiyou/kobanshiryou.pdf.2thisbasis,IwouldliketoexplaintheBank'sthinkingbehindtherecentconductofmonetarysmonetarypolicysinceLastlyIwilltouchupontheeconomyofShizuokaPrefectureandthenwouldliketohearyourviewsonthesituationinthisregionandontheBank.kfortheEconomyIsThisTimeAnyDifferentdAbroadLetmestartwiththeglobaleconomy.TheglobaleconomyhasseenaslowdowninitspacefrecoveryrecentlyandisexpectedtocontinuedeceleratinggoingforwardThePurchasingManagersIndexesPMIsindicatorsofbusinesssentimentforallthreemajoreconomies--theUnitedStates,Europe,andChina--havedeteriorated(Chart2).ThecentralbankoftheUnitedStates,theFederalReserve,raiseditspolicyinterestratesbyatotalofmorethan4inflationSofartheimpactofthishasbeenlimitedmainlytoadeclineinhousinginvestment,whichissusceptibletodevelopmentsininterestratesHowevertheU.S.economyishighlylikelytodecelerateduepolicyinterestratehikesEuropeaneconomiesarealsoaswellastheprolongedinvasionbyRussiaofUkraine.Furthermore,inChina,thesurgeinweighingontheeconomy,especiallyonprivateconsumption.AsIjustdescribed,theglobaleconomyisexpectedtodeceleratetemporarily.Thereafter,however,itislikelytopickupasglobalinflationarypressurewanes,mainlyreflectingthe3ofmonetarytighteningingaffectedbyypriceshaspickedupastheresumptionofeconomicactivityinoverseaseconomiesthatImentionedearlier,togetherwiththeimpactofhighcommodityprices,areexpectedtoputdownwardpressureontheeconomy,itislikelytocontinuerecovering,supportedbyaccommodativefinancialconditionsandtheeffectsofthethattheeconomyisexpectedtocontinuegrowingatapaceaboveitspotentialgrowthrate.Therecoveryisexpectedtobesupported,forthetimebeing,bythematerializationofpent-updemandreflectingthewaningoftheimpactofCOVID-19andsupply-sideconstraints--bothofwhichhavebeenweighingontheeconomy--andthereafterbythegradualintensificationofthevirtuouscyclefromincometospending(Chart4).Lookingatthehouseholdsector,althoughJapanhasbeeninthemidstoftheeighthwaveofCOVID-19sinceautumnlastyear,theconsumptionofservices--suchastravelanddining2Itshouldbenotedthattherearevariousuncertaintiesregardingthisoutlook.ratesremainhigherthanexpected,thiswillincreasethedegreeofmonetarytighteningrequiredandintensifydownwardpressureontheeconomyaccordingly.Attentionalsoneedstobepaidtotheriskthatglobalmonetarytighteningcoulddestabilizeinternationalfinancialandcapitalmarketsby,forexample,causingadjustmentsinassetmarketsorleadingtoanoutflowoffundsfromemergingeconomieswithlargeexternaldebtbalances.ieswithregardtocontainingis,economicactivityrecoversrapidlyafterweakeningtemporarily--thiscouldintensifyglobalncommodityandenergypricesmakingcentralbanksaroundtheworldconductfurthermonetarytightening.Attentionisalsowarrantedonadjustmentsintherealestatesector,thecourseofvariousregulations,andaslowdowninmedium-tolong-termpotentialgrowthratesduetochangesindemographics.RegardingdevelopmentsinChina'spotentialgrowthrates,seeSasaki,T.etal.,"China'sLong-TermGrowthPotential:CanProductivityConvergenceBeSustained?"BankofJapanWorkingPaperSeries,no.21-E-7(June2021),https//www.boj.or.jp/en/research/wps_rev/wps_2021/data/wp21e07.pdf.4out--hasbeenfirmasmobilityhascontinuedtorecoverasatrend.Thegovernment'sdomestictraveldiscountprogramandtheincreaseininboundtourismdemandduetotheeasingofCOVID-19bordercontrolshavesupportedtherecoveryinservicesdemand.Meanwhile,pricerisesforfood,energy,andotheritemshaveputdownwardpressureonhouseholds'realincomeandsentiment.However,privateconsumptionhascontinuedtoreasemoderatelysupportedbytheeffectsofthegovernmentsmeasurestoaddressrisingpricesandhouseholdsavingsthathaveaccumulatedasaresultofpandemic-relatedrestrictions.Turningtothecorporatesector,althoughslowdownsinoverseaseconomieshavepushedtheimpactofCOVID-19andsupply-sideconstraintswaning.Againstthisbackdrop,themEconomicSurveyofEnterprisesinJapan)suggeststhatbusinessfixedinvestmentforfiscal2022willseeafinancialconditions.However,thisoutlookforJapan'seconomyissubjecttoconsiderableuncertainties.Indevelopmentsinpricesofcommodities,includinggrains,andthecourseofCOVID-19athomeandabroadneedtobenoted.Furthermore,wepayattentiontodevelopmentsintrendtodateChart5).Wearecurrentlyinaperiodofextremechange;besidestheimpactofthepandemic,theGlobalchallenges,suchasdecarbonization,arealsogrowing.Ifhouseholdsandfirmscansuccessfullyrespondtosuchdevelopments,thiscouldraisemedium-tolong-termexpectedgrowthratesandtherebyfurtherstrengthenthevirtuouscycleintheeconomy.BPriceDevelopmentsinJapanreaching4.0percentforDecember2022(Chart6).ThisisthehighestinflationrateinJapan5inaboutfourdecades,andthisisattributabletotheeffectsofapass-throughtoconsumerpricesofcostincreasesledbyariseinimportprices.However,suchupwardpressureonconsumerpricesishighlylikelytowanegradually.Infact,internationalcommoditypriceshavealreadyturnedtoadecline,andtherateofincreaseinJapan'simportpriceshasclearlyslowed.Furthermore,theeffectsofthegovernment'seconomicmeasurespushingdownardThereforetheyear-on-yearrateofincreaseintheCPIisexpectedtodeceleratetowardthemiddleoffiscal2023.Thereafter,withtheeconomycontinuingtorecover,itisprojectedtoaccelerateagainmoderately,althoughitwilltaketime.Thisaccelerationislikelytobemainlyduetotighteningsupplyanddemandconditionsintheeconomyandariseinwagegrowth,whichIwilltouchuponlater.IntheOutlookReport,theyear-on-yearrateofchangeintheCPI(allitemslessfreshfood)2024,being1.6percentand1.8percent,respectively.Intermsoftheeffectsofthegovernment'seconomicmeasures,thosemeasurestoreducethehouseholdburdenofhighergasolineprices,electricitycharges,andmanufacturedandpipedgaschargesareexpectedtoCPImainlyforthefirsthalfoffiscalForfiscal2024,ontheotherhand,theyarelikelytopushuptherateduetoawaningoftheearInthisregardlookingatyearonyearrateofchangeforfiscalisprojectedtobeataroundpercentGiventheseprojectionsitwillstilltaketimetoachievethepricestabilitytargetinasustainableandstablemanner.Asmentionedearlier,therecentCPIinflationisattributabletoavarietyoffactors,suchastheimpactofthesubstantialriseinimportprices,particularlyforenergyandgrains,aswelldifficulttograspunderlyinginflationbasedonasingleindicator,itisbecomingevenmorementsincludingsupplyanddemandconditionsintheoveralleconomyandwagedevelopments,ratherthanjustlookingatsuperficialfigures.6Fromthisperspective,IwouldliketohighlightthreepointsthatIamcloselymonitoringinassessingcurrentunderlyinginflation.ThefirstischangesinthepricechangedistributionbyitemChartInJapanunlikeintheUnitedStatesandEurope,pricechangesformanyitemshavebeenconcentratedinanarrowoundpercentforalongtimeHowevercomparingthemostrecentpricechangedistributionwiththatbeforethepandemic,therighttailhasbecomethicker--thatis,thedistributionhasshiftedinthedirectionofrisingprices.Whilethispatternhasbeenobservedtobeseenwhetheritwillspreadtoservicespricesaswell.Thesecondpoint,whichrelatestothefirstonethatIjustmentioned,isfirms'price-settingstance(Chart8).AccordingtotheTankan,thediffusionindexes(DIs)foroutputandinputalsothattheshareofthosereportinganincreaseinoutputpriceshasincreasedrecently.Inaddition,thedistributionoffirms'forecastsforprices,orinflationexpectations,hasshiftedsomewhatinthedirectionofpricerises.ThethirdpointconcernsfirmswagesettingstanceChartInachievingthepricestabilitytthatthisbeaccompaniedbyanincreaseinwagesItisnoteworthythat,whereasfirms'senseoflaborshortagetemporarilyweakenedduringtheearlystageofthepandemic,ithasintensifiedagainamidthepick-upintheeconomy,alreadyreachingthepre-pandemiclevel.Moreover,inpredictingdevelopmentsinwagesforthetimebeing,theannuallabor-managementwagenegotiationsthisspringwillbeamajorkey.Ibelievethatmanyfirmsarecurrentlyintheprocessofnegotiating,andtherateofbasepayincreasesnsismuchhigherthaninthepastreflectingthepricerisessincelastyearThegovernmentandmanycorporateexecutiveshavepointedtotheimportanceoffirmlyraisingwageswhiletakingthecurrentpricerisesintoaccount.Therefore,Iampayingattentiontothedegreetowhichbasepaywillincreaseinpractice.Whatisimportanthoweveriswhetherthesechangeswillbesufficientlysustainedandleadtotheachievementofthe2percentpricestabilitytargetinasustainableandstablemanner.7Thereremainhighuncertaintiesinthisregard.Inparticular,sincethecurrentchangeswerehangeswillbemaintainedevenaftersuchcostpushpressureshavediminishedthatis,whetherchangesinfirms'price-andwage-settingbehaviorwilltakeholdandpeople'sguseofanecdotalinformationfromfirmsinadditiontoawiderangeofstatistics,theBankwillassessappropriatelytheoutcomeoftheannuallabor-managementwagenegotiationsthisringandhowfirmspricesettingstrategieswilldevelopinreflectionoftheirexperienceofraisingpricesduringthecurrentphase.centConductofMonetaryPolicySofar,IhaveexplainedtheBank'sviewondevelopmentsineconomicactivityandprices.Withsuchcircumstancesinmind,theBankconsidersitimportanttofirmlysupporttheeconomyandprovideafavorableenvironmentforfirmstoraisewages.Inthisregard,theBankdecidedattheMonetaryPolicyMeeting(MPM)heldlastmonthtocontinuewithmonetaryeasing.inordertoimprovemarketfunctioningwhilemaintainingaccommodativefinancialconditions.Themodificationwasdonewiththeaimofenhancingthesustainabilityofmonetaryeasingunderyieldcurvecontrol.TheBankexpectsthatthemodificationwillfacilitatethetransmissionofmonetaryeasingeffectsgeneratedunderthisframework.InostabilizetheentireyieldcurveatalowleveltheBankhasalsoincreaseditsamountwithmonetaryeasinghasnotchangedatall.taryPolicyAchievementsandDiscussionssincelongertermperspectivenamelytheevolutionandachievementsofmonetaryeasingsince2013,misconceptionsandcriticismsregardingtheBank'smonetarypolicy,andtheimportanceofinflationtargeting.8EvolutionandAchievementsofMonetaryEasingsincetheinflationrateturnedclearlypositiveonlyafteritintroducedlarge-scalemonetaryeasingin2013.TherecenthistoryofmonetaryeasingisshowninCharts10and11.Threepointsareimportanthere.First,thestartingpointforthecurrentlarge-scalemonetaryeasingwasthemoftheintroductionofquantitativeandqualitativemonetaryeasing(QQE)inApril2013,followedbytheadoptionofnegativeinterestrates,andthereafterthecurrentyieldcurvecontrol.Third,theBankhaspersistentlypursuedmonetaryeasingtodate.Overtheyears,therehavebeennumerousexogenousshocks,suchaslargefluctuationsinpricesoftheconsumptiontaxhikes,multiplenaturaldisasters,andtheoutbreakofCOVID-19.OneachoccasiontheBankhasmadevariousresponsesinaninnovativeandcreativemanner.artLetmehighlightafewpointsFirstofall,economicgrowthhasbeenrestored.Reflectingthedecliningandagingpopulation,ashedowntrendinworkinghoursJapansGDPgrowthrateistrendingdownwardbutwhenexcludingthedeclineduetothepandemic,ithasimprovedsince2013astheattherealGDPgrowthratepercapita,theratewasat0.4percentinthe2000s,whereasit3ThedescriptionsinthissubsectionarebasedinpartonWakatabe,M.,"TheFutureofMonetaryoftheJapanAssociationofBusinessCycleStudies,December3,2022,https://www.boj.or.jp/en/about/press/koen_2022/ko221222a.htm.AlsoseeKataoka,G.,"Abenomikusugooikaninorikiruka:Nipponkeizai10-nennokisekitokongonoshinario"[Howto9recoveredto1.3percentinthe2010s,almostequivalenttotheaveragegrowthrateofthe1990s(Chart13[leftchart]).Ihavealwaysbelievedthatthenegativeimpactofadecliningpopulationontheeconomytendstobeoverestimatedingeneraldiscussion.AsamatterofGDPgrowthratesionbetweenthemChartrightchartWhileitistruethatadecliningpopulationisaheadwindforeconomicactivity,economicgrowthisstillpossibleeveninsuchcircumstances.wasinitiallydrivenbyariseinnon-regularemployees,butregularemployeeshavealsoincreasedsince2014.Moreover,thelaborforceparticipationratesforseniorsandwomenhaverisen.4Improvementinemploymentconditionshasledtoanincreaseintheemploymentratefornewgraduatesandchangedthesituationdrasticallycomparedwiththetimeofthe"employmenticeage."Ofcourse,providingsupportforthosewhostruggledtoeemploymenticeageremainsacrucialtaskInthisregardaswelllargetroleThird,taxrevenueshaveincreased,reflectingeconomicgrowth.Fourth,withregardtoprices,wearenowinasituationwheretheeconomyisnolongerintaineddeclineinpricesWhiletheaverageyearonyearrateofchangeintheCPI(allitemslessfreshfood)wasminus0.3percentbetweenfiscal1998andfiscal2012,thatfromfiscal2013onwardroseto0.5percent.Fifth,wageshaverisen.Basepayincreases,whichhadnottakenplaceinrealtermsforaprolongedperiodhaveresumedsincefiscal2014,andnominalwageshaveincreased,albeit4SeeChartsB2-3andB2-5inBox2"CurrentSituationandOutlookforLaborMarketConditions"intheJanuary2023OutlookReport.lypositiveeffectsinvariousaspects.ussionsoverMonetaryPolicyincludingthatbasedonmisconceptions.Thefirstcriticismisthatthemonetarypolicyisineffective.Asalreadydescribed,ithasclearlybeeneffective.Infact,estimatesonwhateconomicandpricedevelopmentswouldwouldhavebeensubduedandpriceswouldhaveremaineddeflationary.6Thesecondcriticismconcernsthenotionofthe"interestratebuffer"and"zombiefirms,"tointhiscontext.Whenpeopletalkaboutinterestrates,theyoftenrefertonominalinterestratesbutitisimportanttodistinguishthemfromrealinterestrates,whichtakeinflationintoaccountWhenconsideringtheeconomicimpactwhatisimportantisrealinterestratesItisakatabeMJapansEconomyandMonetaryPolicyspeechatameetingwithlocalleadersinHiroshima,September1,2021,httpswwwbojorjpenaboutpresskoen21/ko210901a.htm.Forpricestoriseinasustainableandstablemanner,bothwagesandinflationexpectationshttpswwwboj.or.jp/en/about/press/koen_2022/ko220601a.htm.6TheestimationresultisexplainedinmoredetailinAppendix2oftheAssessmentforFurtherEffectiveandSustainableMonetaryEasingreleasedinMarch2021httpswwwbojorjpenmopompmdecimpr1/k210319c.pdf).Comparedwiththehypotheticalonaverage,pushedupthelevelofrealGDPbybetweenaround0.9and1.3percentandtheyear-on-yearrateofchangeintheCPI(excludingfreshfoodandenergy)bybetweenaround0.6and0.7percentagepoints.onlyrecentlythatrealinterestratesinJapanhavebeenlowered.Iftheactualandexpectedalinterestrateswouldhavebeenhighevenwhennominalinterestrateswerelow.Onthisbasis,thenotionoftheinterestratebufferisthat,withalowinterestratepolicycontinuingtobeimplemented,roomforamonetarypolicyresponsetoapossiblefutureeconomicdownturnorfinancialcrisesbecomessmall.WhileIagreethathavingroomformonetarypolicyresponseisimportant,raisingpolicyinterestratestocreatesuchroomwilldamagetheeconomy.Thisoutcomewouldbeinoppositiontotheintendedobjective.Intolowerinterestrates,raisethemfirst."Thismeansthat,ifyouwanttocreateroomforapolicyresponse,youshouldfirstencourageeconomicgrowthandliftinflationexpectationsstratesthatareneutraltotheeconomywillriseaccordingly.Infact,oneofthereasonsthatmanycentralbankssettheirinflationtargetsat2percentisbasedonthisthinking.firmsprospectsforrecovery,andonlyareabletocontinueexistingwiththesupportofbanksinparticular.Thenotionisthatsuchfirmsarekeptalivebecauseofalowinterestratepolicy.Asamatteroffact,itshouldbenotedthatthenotionofzombiefirmsinthecontextofacademicresearchdoesnotdirectlyconnecttomonetaryeasingmeasures,sinceitfirstfinancing,notinrelationtomonetarypolicy.Moreover,somearguethatsuchfirmsareincreasing,butthisisnotnecessarilysupportedbyempiricalevidence(Chart14).7,8Rather,thelowinterestrateenvironmentsupportscorporatefinancingandtherebycontributestoexpandinginvestmentbyfirmsandimprovingtheirperformance.Thethirdcriticismisthat,toboosteconomicgrowth,measurestotacklethedeclininggSuchmeasuresandgrowthstrategies,however,arenotcontradictorytopoliciestostabilizethemacroeconomy,includingmonetaryeasing,andthereforeshouldbepursuedsimultaneously,asstatedintheosearyeasingmeasureshavebeeneffectiveinboostingGDPgrowthandincreasingemployment,asmentionedearlier.Furthermore,if--weretofallduetoadecliningbirthrateandalowpotentialgrowthrate,thecentralbank7Forexample,astudyoftheshareofzombiefirmsacrosscountrieswasconductedbytheBankforInternationalSettlements(BIS),anditshowsthat,inJapan,thesharehasbeenonadowntrendsincetheGlobalFinancialCrisis(GFC).SeeBanerjee,R.N.,andHofmann,B.,"CorporateZombies:AnatomyandLifeCycle,"BISWorkingPapers,no.882(2022),httpswwwbisorg/publ/work882.htm.AstudybytheBank'sstaffdefinedzombiefirmsquantitativelyintermsofthreecriteria--namely,interestpayment,solvency,andgrowthpotential--andfoundthattheshareofzombiefirmsinrelationtothetotalnumberoffirmshasremainedatalowlevelsincethe2000s,afterincreasingsignificantlyinthe1990s.Thatsaid,recentdevelopments,particularlyaftertheoutbreakofthepandemic,mustbeinterpretedwithcautiondueinparttodatalimitations.SeeYamada,K.etal.,CorporateFinanceFacilityandResourceAllocation:ResearchTrendsandDevelopmentsduringtheSpreadofCOVID-19,"BankofJapanWorkingPaperSeries,no.23-E-1(January2023),https://www.boj.or.jp/en/research/wps_rev/wps_2023/data/wp23e01.pdf.ncriteriathenumberoffirmsthatcannotcontinuetheirbusinesswithoutthesupportoffinancialinstitutionsorgovernmentssurgedatthetimeoftheGFCbuthasnotshownsuchaclearincreaseaftertheoutbreakofthepandemic.SeeUesugi,I.etal.,"Koronashokkuenokigyōnotaiōtoseisakushiensochi:Sābeichōsanimotozukubunseki"[TheEconomyandSocietyundertheCOVID-19Pandemic:EvidencefromSurveys],EconomicReviewnoppUesugiI.,Chūshōkigyōkin'yūnokeizaigaku:Kin'yūkikannoyakuwari;Seifunoyakuwari[Economicsofsmallbusinessfinance:TheroleoffinancialinstitutionsTheroleofthegovernmentTokyoNikkeiPublishing,2022),pp.43-47.umsizedfirmswithnodebtwhichdonotrelyonbankloans,havearathersmallappetiteforcapitalinvestment.SeeUesugi,Chūshōkigyōkin'yūnokeizaigaku,pp.35-38.wouldneedtopursuepoliciestosupporttheeconomybyfurtherloweringmarketinterestratesbelowthenaturalrateofinterest.9InflationTargetingereIwouldliketoexplaintheimportanceofinflationtargetingonceagain.Currently,themostimportantmandateformanycentralbanksistomaintainpricestability.Inflationtargetingclearlydefinesthismandateinquantitativeterms,andmanycentralbanksaroundtheworldhaveadoptedsuchtargeting(Chart15).Theoretically,onecouldarguethatotherindicators,suchasthenominalGDPgrowthrate,couldbesetasapolicyobjective.However,itistheyMajoreandtheECBalsotargetapercentinflationrateforecouldunderminethetransparencyofmonetarypolicyanditseffectivenessThisappliestodealingwithnotonlydeflationbutalsoinflation.eEconomicActivityinShizuokaPrefectureBeforeclosingmyspeech,IwouldliketotalkabouttheeconomyofShizuokaPrefecture.Theprefecture'seconomyiscurrentlypickingupasatrend,despitebeingaffectedbyInhispaperpublishedinwhichadvocatedatanearlystageforJapanhavingmoreaggressivemonetaryeasing,ProfessorKrugmanassumesthatJapan'snaturalrateofinterestisfallingduetoadecliningbirthrate.Thepapersuggeststhatmacroeconomicpoliciesarenecessaryespeciallywhentherearestructuralproblems.SeeKrugman,P.R.,"It'sBaaack:Japan'sSlumpandtheReturnoftheLiquidityTrapBrookingsPapersonEconomicActivitynopp.137-87.entsinthenaturalrateofinterestwasdescribedinWakatabeFutureofMonetaryPolicy"(seen.3).10ThedebateonthemonetarypolicyframeworktakingplaceintheUnitedStateswasdescribedinthefollowingspeech:Wakatabe,M.,"Japan'sEconomyandMonetaryPolicy,"speechatameetingwithbusinessleadersinAomori,June27,2019,https://www.boj.or.jp/en/about/press/koen_2019/ko190627a.htm.11ProfessorOrphanidesattheMassachusettsInstituteofTechnology,whoisanhonoraryadvisortotheInstituteforMonetaryandEconomicStudiesoftheBankofJapan,arguesthatlackofclarityonthedefinitionofpricestabilityrenderedtheBank'smonetarypolicyinadequatebefore2013.SeeOrphanides,A.,"TheBoundariesofCentralBankIndependence:LessonsfromUnconventionalTimesMonetaryandEconomicStudies(November2018):pp.35-55.Whenconsideringthefuturedevelopmentoftheprefecture,themajorchallengeishowtodealwithadecliningpopulation,aswithotherregions.Sinceitspeakof3.80millionpeoplenuedtodeclineatafasterpacepopulationisoverestimated.Asamatteroffact,grossprefecturalproductpercapitainShizuokaPrefecturehasbeenonanuptrendsincethe2010saftertheGFC(Chart16).Toaccumulationof"capital,"growthin"laborforce,"and"knowledge"inabroadsense,includingtechnology.Enhancingeachofthesesourceswillbethekeytoachievingfurtherofinitiativesintheprefecturethatareattractingattentionfromthisperspective.sesoncapitalinvolvingthedevelopmentofinfrastructureandindustrialpromotionbytakingadvantageofsuchinfrastructure.ThePortofShimizu,anfromotherprefecturesthatarenoweasiertotransportafterthefullopeningoftheChubuOdanExpresswayin2021.Inaddition,asanetworkofroadstakesshapealongtheIzuPeninsula,theprefectureisdedicatingitseffortstopromotingtourismandcreatingasincetheyareutilizingaccumulatedcapitalasadrivingforcetosparkgrowthinexportsandcaptureinboundtourismdemand.knowledge.12Mainlyinthewesternpartoftheprefecture,wheretheautomobileindustryisconcentrated,industry,academicinstitutions,andlocalgovernmentagenciesareworkingtogethertoaddressmajorchangesintheenvironment,suchasadvancementofso-calledofnextgenerationvehiclesnddesigntomanufacturingandsales,sothattherelevantsmallandmedium-sizedfirmscancultivatenewbusinesses.Moreover,besidestheeffortsmadebylocalgovernments,itisimpressivethatagrowingnumberofregionalfinancialinstitutionsintheprefecturearefosteringandsupportingentrepreneursandventurestartupsbyleveragingtheirre