After Falling Into Recession, Japan's Prime Minister Calls For Snap Elections
Just after his country's economy officially fell back into recession, Japanese Prime Minister Shinzo Abe announced he would dissolve parliament and call for elections two years ahead of schedule.
"Mr Abe was elected two years ago with an ambitious plan to revive the economy, but has struggled to do so."His popularity has fallen but he is expected to win the election, which will take place in mid-December. "'I will dissolve the lower house on 21 (November) ,' Mr Abe said. "Mr Abe's party, the Liberal Democrats, already has a majority in the lower house, but analysts said Mr Abe hoped to consolidate power over an opposition party which is in disarray."
CNBC reports that Abe also announced he was shelving a controversial plan to raise the sales tax. CNBC adds:
"Japan has suffered since the first consumption tax hike from 5 to 8 percent in April. Abe said the rise in the sales tax 'acted as a heavy weight and offset a rise in consumption.' A second consumption tax hike was set for October 2015 which would have seen a 2 percent increase to 10 percent."
Yesterday, the country released growth numbers, showing the Japanese economy contracted at a 1.6 percent rate in the third quarter. It had contracted 7.3 percent in the second quarter.
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