China must try to halt economic slowdown
Spillover effects of the European debt crisis have become a drag on the Chinese economy, an engine of world growth.
China's slowdown could deal a serious blow to already gloomy prospects for the world economy. Measures to halt the slowdown are needed.
The Chinese government has announced the country's real gross domestic product grew 7.6 percent in the April-June period over a year earlier, falling below 8 percent for the first time in about three years. The country's growth slowed for a sixth straight quarter.
Eight percent growth is regarded as the minimum needed for China to maintain its economic activity and employment levels. China's stagnating growth since the so-called Lehman Shock in 2008 has been significant.
The economic weakness is mainly due to the slowdown in exports to Europe and other countries amid the lingering European debt woes. A slump in public investment and corporate capital spending has sent the country's manufacturing activity into decline. Consumer spending has also lost impetus. These three areas--exports, manufacturing and consumer spending--all slowed together.
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Steps to shore up economy
Last week, China's central bank lowered key interest rates for two consecutive months. Before announcing the GDP numbers Friday, China apparently aimed to reduce the news' negative impact on the economy by slashing the rates.
Beijing has taken a series of steps to shore up the economy, such as introducing an incentive program for buyers of energy-saving home electronic appliances and eco-friendly vehicles and bringing future infrastructure investment plans forward.
The Chinese government has lowered the country's growth outlook for this year from 8 percent to 7.5 percent. It must be wary now that its economy has begun to cool at a pace faster than it anticipated.
China plans to change its top leadership this autumn. Even though China cannot achieve high growth at a rate of more than 10 percent as it once did, moderate growth must be secured to enable the leadership transition to go smoothly.
However, China's economic prospects are unclear.
The debt crisis in Europe, China's major export destination, has yet to be resolved, while the U.S. economy has seen signs of slowdown. Alarmed by the current situation, the International Monetary Fund next week reportedly plans to lower its forecast for global economic growth.
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Boost domestic demand
To achieve stable growth, China urgently needs to shift its economy to one led by domestic demand that will allow it not to depend excessively on exports. For that purpose, the country should spend more on environmental measures and infrastructure projects, such as development of subway systems.
As commodity prices have been steady, China also has room to take additional monetary easing measures. Steering the economy in the right direction is difficult, but we urge Beijing to consider effective measures as soon as possible.
Brazil, India and South Korea have cut key interest rates one after another. Moves to ease monetary policy have gained momentum in the world.
Meanwhile, it is of concern that there is no sign that the extreme strength of the yen will end soon, in light of a spate of rate cuts and the sluggishness of the U.S. and European economies. It is vital for both the government and the Bank of Japan to better respond to the situation by trying foreign exchange intervention and other possible measures.
(From The Yomiuri Shimbun, July 14, 2012)
(Jul. 15, 2012)
Waste no time in designating landslide-prone districts
Disastrous landslides triggered by downpours have swept away entire communities in mountainous areas again this year.
Torrential rain that pounded the Kyushu region this time left about 30 people dead or missing in Kumamoto and Oita prefectures. An active seasonal rain front remains in place over the region. The strictest possible watch must be kept on weather conditions.
This is certainly a record-breaking deluge.
In the city of Aso, Kumamoto Prefecture, where the largest number of fatalities has been reported in the latest disasters, hourly rainfall reached a maximum of 108 millimeters Thursday. The cumulative precipitation during 24 hours--507.5 millimeters--was the most on record.
The municipal government of Aso issued evacuation orders to every household in the city, about 10,000 in all, but the orders came after the city had already been drenched by heavy rains.
Instead of going to shelters, many residents stayed home and were buried in landslides with their houses. They may have been hesitant to leave their homes because the rainfall was extremely heavy.
Whether the evacuations orders were timely must be scrutinized.
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Hazard maps essential
In an attempt to call attention to the potential for a disaster, the Japan Meteorological Agency issued a warning using unprecedented language, describing the rainfall as being at levels "that have never been experienced before." Such wording can be said to have conveyed a sense of urgency.
But such warnings were disseminated on TV and by other media after landslides had occurred in Aso. Lessons must be drawn in this regard for the future.
With hilly areas accounting for a great majority of land of this country, disastrous landslides have occurred in various parts of the nation almost every year. The number of people killed in landslide disasters stood at about 280 in the 10 years through 2011 across the country. Countermeasures must be taken as quickly as possible.
Hazard maps are an effective way to protect residents from the risks of landslides. These are color-coded maps drawn in accordance with degree of susceptibility to landslides in areas designated as landslide danger zones.
The government made it obligatory in 2005 for city, town and village governments to distribute hazard maps to every household under their jurisdiction. The maps make it easier for city, town and village governments to issue evacuation orders or advisories when the need arises.
However, prefectural governments have made little progress in designating landslide danger zones.
The situation is bleak: Aomori Prefecture was the only prefecture in the country to complete its danger-zone designation by 2011. The other prefectures must speed up their efforts.
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Bridges, roads left unrepaired
Especially noteworthy in the Aso disaster this time is the fact that part of the city where the landslide damage was particularly heavy is not included in the prefecture's partially completed landslide danger designations.
Thorough nationwide inspections should be conducted to ensure no dangerous spots where the ground can become saturated with water in heavy rain are overlooked.
It is also indispensable to confirm the safety of such facilities as bridges and roads that will be used by residents during evacuations. Bridges spanning swollen rivers in the disasters this time were washed away one after another.
Many of the obsolescent bridges around the country have reportedly been left unrepaired because of stringent fiscal circumstances of local governments.
It is crucial that local entities use limited revenue wisely in funding public works projects that are necessary for disaster prevention.
(From The Yomiuri Shimbun, July 14, 2012)
(Jul. 15, 2012)
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