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Japan PM warns economy could “collapse” under debt pile
NEW Japanese Prime Minister Naoto Kan has warned that the country could “collapse” under its debt pile unless it reins in its massive public debt.
Kan, who took over the nation’s top job after his predecessor quit, has made tackling a public debt that is already twice the size of Japan’s GDP a top priority amid market concerns about sovereign debt risk.
He said a reform of the tax system was vital.
“We cannot sustain public finance that overly relies on issuing bonds,” Kan told parliament in his first policy speech.
“Like the confusion in the eurozone triggered by Greece, there is a risk of collapse if we leave the increase of the public debt untouched and then lose the trust of the bond markets.”