Japan Press Weekly

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2020 November 11 - 17 [POLITICS]

Ex-analyst at Goldman Sachs and current PM Suga's advisor coldly insists shakeout of SMEs in Japan

Advisor to Prime Minister Suga Yoshihide and former banking analyst at Goldman Sachs David Atkinson on November 15 attended a government-experts meeting to evaluate government support measures for small- and medium-sized enterprises and suggested that SMEs in Japan be merged, integrated, or abandoned.

External experts in the meeting proposed that the effects of the government measures to support SMEs be verified to know to what extent these measures contributed to improving "productivity". Atkinson said, "Expansion of the size of companies is necessary to improve productivity."

According to handouts for the meeting, SMEs in Japan account for 99.7% of all business entities in Japan, and 68.8% of the Japanese working population are SME workers.

Honda Etsuro, former special advisor to the Abe Cabinet at that time and former Japanese ambassador to Switzerland, last month regarded Atkinson's argument for cuts in the number of small companies as "extremely risky". Honda criticized the SME restructuring scheme, saying, "It would bring about a high rate of unemployment and collapse the Japanese economy. It will surely fail."

Meanwhile, Takenaka Heizo, advisor to PM Suga and Pasona Group chairman, in the November issue of the Bungeishunju magazine said that the SME support measures during the COVID-19 pandemic "do not bail out companies which were already suffering a management crisis before the pandemic". He also said, "Maintaining companies which should be weeded out will lead to weakening the Japanese economy in the future."

Past related article:
> Advisors to PM Suga side with the strong and are crushing the weak [October 15, 2020]