End of Abe era leaves Japan still searching for way forward

MITO, Japan (AP) — Among the challenges awaiting newly appointed Japanese Prime Minister Yoshihide Suga is the urgent challenge of how to keep the world’s third-largest economy growing as its population ages and shrinks.

Yoshihide Suga, Abe’s former chief spokesman, was appointed prime minister on Wednesday after Abe resigned because of a chronic health problem. He has vowed to stick with the “Abenomics” playbook of cheap credit and stimulus spending, but has yet to articulate a vision for the future for a nation wary of the sweeping changes needed to keep the economy growing.

Suga has so far talked mainly about issues that were initiatives a quarter century ago, such as deregulating phone carriers and boosting investment in rural areas, said Michael Cucek, an expert on Japanese politics at Temple Universty in Tokyo.

Vision does not appear to be his strong point.

“He knows how to get things done but seems dogmatic to the point of obtuseness on what those things should be,” Cucek said.

It's unclear that Suga, dubbed the “iron wall” for his resistance to answering reporters’ questions, has the charisma and political heft to sell to the public and business world the kinds of sweeping changes to tax codes and other policies that are needed to help the country break out of its slow decline.

During Abe's more than seven years in office, the central bank pumped tens of trillions of dollars, supporting a modest economic recovery that never gained the momentum needed to break out of the rut Japan has been in since its financial bubble burst in the early 1990s.

Time is not on Suga's side: Japan's population has been falling for eight straight years and is projected to sink by about 40% by 2050.

The trends are evident in Tokyo, but even more so in smaller...