Eurasia's Seaman: Abe Will Stop Consumption Tax Passage (Audio)

its biggest weekly game since March. Banks, technology and consumer discretionary shares led the way. Federal reserved her Janet yellin sudden remarks at Harvard University that an improving economy would probably warrant another rate increase in the coming months, and that sent the dollar higher, weighing on commodity producers, which at the markets every fifteen minutes down. Industrial average A rose forty five points a quarter percent to close out

the week at seventeen thousand, eight hundred seventy three. Smp f i've founded up nine points four time of a percent to two thousand ninety nine. Then as that game thirty two points two thirds of a percent to close at forte less Texas Centermedia Crude oil up three cents of barrel to one spout, goal down nine dollars ten cents ance to twelve thirteen sixty, the tenure treasury down six thirty seconds with the yield of one point eight

five And that's a Bloomberg business flash. Yourmous ranted taking start with Kathleen Hayes and Pim Fox on Bloomberg Radio.

Kuroshima a beautiful city in western Hanshu, the largest island of Japan, of course, best known as the first city in history to be targeted by a nuclear weapon, when the United States Army Air Force dropped an atomic bomb on the city at eight fifteen am August six nine, nearly seventy one years later, President of Rock Obama used the backdrop of the city's Memorial Peace Park to call

for call for a world without such weapons. He did not apologize for America's use of atomic weapons during the war, but he did express more for the human toll of that war. And of course, this is part of his trip to Japan to be part of the G seven Summit of global leaders are very happy now to welcome to the show to talk about the significance of his visit. What was or wasn't accomplished at the G seven meeting, Scott Seaman a senior analyst for you a Eurasia for

Asia excuse me, at the Eurasia Group. Scott, welcome, Thank you. How significant is this to Japan, to the Japanese into relationships between the two countries. I think it's hugely significant. You know, I picked up on one thing in particular. There was an older Japanese gentleman who I believe was the leader of one of the groups of survivors from the atomic bomb and Uh. I think the simple statement that he started with was that he never expected to

see the US president visit Kidroshima in his lifetime. UH. And there was there was no demand of an apology, and of course the US made it clear that they were not prepared to offer one. But overall, I think this adds uh, you know, some closure uh to the war and and certainly shows how far the two countries

have come since then. Scott of money, if you could speak to the issues facing the G seven leaders and what will Prime Minister Snobe be well for for Abe, I think this this was an opportunity, certainly for him to UH talk about the global economy. He wanted to use this meeting as a way to tee up a decision that we think he's very likely to make, and that's to postpone a consumption tax hike that they've had

planned for some time that would be implemented next spring. UH. He has not been keen on going ahead with that, and one of the things that he wanted to accomplish at this summit was to really highlight the theme that the global economy UH is not doing well. And one of the things that Japan can do to cont tribute to efforts to UH to to kind of spurred growth is to hold off on its own tax increased plans. So UH, in terms of geopolitics, that's one of the

things that takes place when that's the G seven. You know, when it's the heads of state meeting, you know, the finance ministers meet, the central bankers meet, they can hammer out more the nets of volts on on economic policies. UH. If we were to go back twenty years ago or so, we would be hammering on the Japanese for their currency right for for keeping it too weak versus our dollar. That mantel kind of shifted to China with the the

US focus. But uh, the g one of the taught geopolitical issues is between China and Japan and the disputed territories. Did anything come out of this that moves that forward that they'd intensifies that struggle? I don't, Well, they're there are a couple of different disputes, um. The one that is is a bilateral dispute between China and Japan over the Sankako Islands in the East China. See that that has obviously been something that has really soured relations between

the two countries for several years now. Uh. And I don't think that there was any particular effort during this summit to to move ahead on on, you know, some sort of reconciliation there. I think it's just kind of a stable situation. But the bigger objective was really for Abe and others to put a little more emphasis on conflicts that are brewing in the South China see uh.

And Japan doesn't have a direct involvement in in territorial disputes there, but certainly sees it as an area that needs to remain stable because it's just such an important area for for trade and transport. Well Scott, in that context, I want to bring in a South Korea as well as China. Are they concerned that the President's visit to Japan could be taken by the Japanese as sort of drawing a line underneath their efforts to come to grips with their own wartime activities in places such as Korea

and China. Um. You know, that definitely was a concern, And I think as I read the speech today that the President gave at Hiroshima, it seemed as if there was a great deal of thought put into trying to make what he said as broad in terms of kind of the time that it covered as well as as

kind of the geographic space that it covered. Um No, I mean Obama did not want to kind of feed into UH the impression that people in other countries in Asia, especially China South Korea had that maybe this was going to be an event that would identify Japan as as the victim of World War two rather than UH than other countries. But I think the the what he said seemed to include UH people who were victims of the

war as a whole. So I think that they took great pains to make sure that they didn't single Japan out as a victim. Just real quick, Well Abby, get this this backing off of that consumption tax increase. Yes, um, so the way I see it, the diet session ends next Tuesday, June one. He's expected at a press conference following that to announce a postponement of that tax hike. Uh. And then it would just be a matter of getting his government to change legislation around that next fall. Thank

you very much. Scott Seaman. He is senior analyst for Asia for the Eurasia Group. Joining us from Washington, d C. Home to Bloomberg and one oh five point seven h D two. Have a lovely Memorial Day weekend. You're listening to Bloomberg Radio. Coming up Bloomberg Law. Brought to you by a celebrity motor car company, The luxury of BMW, the performance of Maserati, innovation of Lexus, walk the red carpet at the status you deserve at the celebrity motor

car company. Visit Celebrity motor car dot com.