Japan Sets FY 2001 Economic Growth Target at 1.7 Percent

Japan on Tuesday set its economic growth target for fiscal 2001 at 1.7 percent, for a third straight year of expansion on the back of a further recovery in private demand.

The real-term target for gross domestic product (GDP) in the fiscal year starting April 1 next year was approved by Japanese ministers involved in economic matters.

"The economy will remain on a self-sustaining recovery path, underpinned by private demand such as personal spending and corporate capital spending," says the government's economic outlook.

The 1.7 percent growth goal will follow a 1.2 percent rise expected to be achieved in fiscal 2000 and a 1.4 percent increase marked in fiscal 1999. The growth in the current year had earlier been projected at 1.5 percent.

The Japanese government said an improvement in employment and income conditions will spur personal spending, which accounts for about 60 percent of Japan's GDP, adding that corporate plant and equipment spending will remain steady due to an upward trend in corporate earnings.

Japan's Domestic demand will account for all of the estimated 1.7 percent growth, with external demand having no effect to push up growth, according to the government outlook.

The government said its economic growth target is based on the premise that there will be no big surprises in economic surroundings, especially such external factors as a sharp slowdown in the US economy.

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