WEAK YEN AN IMPETUS
More pressingly, the weak yen is also providing impetus, with the currency still trading close to a 24-year low against the greenback. With inflation relatively benign, tourists paying in dollars can expect some jaw-droppingly cheap prices in a country where dining out was already a reasonable option.
Having pledged in May to gradually make entry into Japan as easy as for other G7 countries, Kishida should be given credit for a bold and potentially unpopular decision, at a time when his approval ratings are tanking. An Asahi poll on Sunday showed those disapproving of his Cabinet outweighing those who back him, 47 per cent to 41 per cent.
Kishida explicitly mentioned making use of the weak yen in an earlier decision to relax border controls this summer. The move to restore the visa waiver, which could be announced this week, may also exert some influence on the currency; more yen buyers could provide support to stop its slide.
While Japan has been gradually letting in more outsiders, new entrants still need visas; embassies and consulates often don’t have the staff to facilitate the sudden surge in demand. The visa waiver is the key, and was the trigger for Japan’s tourism boom in the 2010s, which sparked a major new engine of economic growth.