Japanese Prime Minister Yoshihide Suga will on Thursday declare a state of emergency for Tokyo and neighboring areas and try to stem Covid-19 infections, which are reaching a daily record in the capital.
The statement will cover the capital and surrounding prefectures of Kanagawa, Saitama and Chiba, and is likely to be imposed from Friday to February 7, said Yasutoshi Nishimura, Minister of Economy. It will be revoked if infections fall below the levels set by the government, he added.
Suga is holding a news conference at 6pm to discuss the matter. Tokyo found more than 2,000 cases of coronavirus on Thursday, a record reported, broadcaster NHK said, referring to an unknown official.
Crowd at the Ameya Yokocho Market in Tokyo, December 30, 2020.
Photographer: Noriko Hayashi / Bloomberg
Japan’s emergency does not imply the kind of blockades seen in some parts of Europe, and the government is seeking far less stringent measures than in its previous emergency last year, which caused the worst economic contraction on record.
Residents will be asked to check out only after 8pm and pubs and restaurants will be instructed to close at that time. Authorities cannot enforce compliance for the time being, although Suga wants to amend the law to add fines for businesses that do not comply with government measures, and to formalize incentives for those who do.
See: Japanese Prime Minister Yoshihide Suga is expected to declare a state of emergency for Tokyo and neighboring territories as coronavirus infections continue to reach record highs.
Bloomberg Economics’ Yuki Masujima sees the emergency declaration shaved to 0.7% off the economy for each month it lasts. Tokyo and surrounding areas account for about a third of the country’s gross domestic product.
Ballooning infections were a blow to Suga, which sought to restore growth despite the pandemic, including by offering travel incentives to strengthen the tourism industry. His public support has waned, with most voters polling favor stricter pandemic measures.
“This increases the possibility of an economic contraction,” said economist Yoshimasa Maruyama of SMBC Nikko Securities about the emergency. “Suga wanted to wait until the New Year’s holiday to make the statement, and that brought him back to limiting the spread of the virus.”
Even before Suga first indicated it would declare a state of emergency, the economic recovery would slow in the first three months of 2021, with businesses cutting back on investment and households deciding to save more.
The restrictions on activities are likely to hamper the effectiveness of the economic stimulus package Suga put together last month, which will have to be funded with an extra budget. The package is no longer suitable in the current environment, Takahide Kiuchi, economist at Nomura Research Institute, said in a research note.
“The government needs to change the content of the third extra budget and change the course of economic policy to strengthen support for companies and individuals,” Kiuchi said.
The decision on emergency declaration will be formally announced after a day of consultation with advisers and reports to parliamentary committees. An advisory panel on the pandemic on Thursday approved the emergency proposal, Nishimura said.
It will be the second in Japan after a statement launched in April, but it is not expected to cause as much pain as the first time, when the virus hit the economy on the brakes and sent it into its worst downturn.
Photographer: Yoshikazu Tsuno / Gamma-Rapho / Bloomberg
Suga’s signature travel campaign “Go To”, which was already suspended on January 11, is unlikely to revive while the state of emergency exists. The government will push to return to remote work, mik na reduces the number of commuters in the region by 70%, Nishimura said. However, schools will not be asked to close and university entrance exams will continue according to schedule.
Japan had by far the lowest infections of any group of seven countries, recording fewer cases in the past year than the US has seen in recent days.
– With the help of Karen Leigh, Lily Nonomiya, Yoshiaki Nohara and Paul Jackson
(Updates with infection numbers in Tokyo.)