Economists give shot in the arm to Japan's COVID-19 fight

Using the country's rich intellectual capital key to avoiding more failures

Left: Stock prices plunged in January 1990 at the end of the bubble economy. Right: People walk in Marunouchi, Tokyo amid economy takes a hit by coronavirus, June 1, 2021. (Source photos by Kyodo and Rie Ishii)

AKIO FUJII, Nikkei chair of editorial board

June 8, 2021 16:17 JST

TOKYO -- Keio University professor Keiichiro Kobayashi, a subcommittee member of the government's coronavirus expert panel, believes the COVID-19 crisis is like nonperforming loans.

To understand this simile, one must look to the 1990s when Japan's asset-inflated bubble economy burst. Nonperforming loans at banks were a menace, eroding the economy. With the weight of bad loans, the economy failed to achieve a full-scale recovery despite stimulus measures such as fiscal spending and monetary relaxation.