Japan Press Weekly

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2020 April 22 - May 12 [POLITICS]

JCP Shimizu: BOJ should urge large corporations to maintain employment

Japanese Communist Party lawmaker Shimizu Tadashi on April 28 at a House of Representatives Financial Affairs Committee meeting demanded that the Bank of Japan urge large companies to maintain employment as the BOJ provided support for their cash-flow problems.

On the previous day, the BOJ decided to significantly increase the purchases of commercial paper, which is used by large companies for short-term finance, and corporate bonds with an upper limit of 20 trillion yen in total.

At the Lower House committee meeting, Shimizu said that amid the coronavirus outbreak, it is feared that job losses will become more severe than during the 2008 financial crisis triggered by the collapse of Lehman Brothers. He noted that central banks in European countries and the U.S. have instructed financial institutions to refrain from paying dividends and to reduce salaries of their executives. Shimizu said that the BOJ should request large companies to make utmost efforts to maintain their workforce.

In response, BOJ Governor Kuroda Haruhiko admitted that the European Central Bank and central banks in some countries have called on private financial institutions to not pay dividends. However, he took a negative stance toward requesting companies in Japan to maintain employment.

Shimizu pointed out that many investors underscore the need for corporations to avoid taking downsizing measures, and criticized the BOJ for offering support for large corporations without setting any conditions. Shimizu stressed, “The BOJ should make an appeal for corporations to maintain jobs.”