“Buy my Abenomics!” urged Japanese Prime Minister Abe Shinzo in 2013. And we did. In a triumph of Something-nomics branding, Abe convinced the world that his so-called three arrows of “bold monetary policy, flexible fiscal policy and a growth strategy” would transform Japan’s economy. Now Abe is stepping down after more than eight years in power, it is time to judge: did Abenomics succeed?
The simple answer is no. The central goal of Abenomics was an inflation target of 2%. Yet even before Covid-19 Japan never got closer than about 1%. This is failure. But like a football team that fails to win the league, defeat does not necessarily mean you were bad, just not good enough. Abenomics had its moments. For a world struggling with “Japanification” — a slide towards stagnation, deflation and ultra-low interest rates — it holds powerful lessons.