Meanwhile, there are strong indications that jobs are being lost here because of the sudden rise in the value of the yen relative to the dollar and other currencies.
Shipbuilders in South Korea, for example, have reported a surge of orders, which they attribute to a sudden decline in the competitiveness of Japanese shipyards as a result of the high yen. And Bandai Co., a leading Japanese toy maker, announced March 20 that it would transfer 15% to 20% of its manufacturing to overseas plants this year.
The company expects 50% of its manufacturing to be conducted abroad three years from now and ultimately is aiming to move 70% of its business overseas. The company has plants in Taiwan, Hong Kong and Singapore and is building one in China.
Yet Nakasone said recently that Japan would emerge a net winner from the yen's rise.
He told a businessmen's club on April 5 that profits from the yen's appreciation in fiscal 1986, including non-trade payments, should total 10 trillion yen ($58 billion). After subtracting the deflationary effect of the impact on exports, such a windfall would still amount to at least 2 trillion yen ($11.77 billion) and possibly as much as 3 trillion yen ($17.5 billion).
Nakasone said he intended to ensure that appreciation gains were reflected in lower prices for imports, which, in turn, would have the same effect on the economy as a tax decrease of the same magnitude.