Japan's Abe: Won't flinch at volatile stock market

Tokyo's jack-knifing stock market will not push Prime Minister Shinzo Abe off course in his mission to re-energise Japan's economy, he told business leaders Tuesday. Despite wild swings on the exchange in recent weeks, including a one-day drop of 7.3 percent and a more-than five percent fall another day, Abe's determination to fire the "three arrows" of his touted reforms is undiminished. "I am resolute to tackle any difficulties without flinching," he told the general assembly of the Japan Business Federation (Keidanren) in Tokyo. "I will continue shooting the three arrows without wavering, even though the markets have shown unstable movements in recent days." The Nikkei 225 index climbed rapidly since November, when Abe emerged as favourite to become prime minister, surging about 80 percent and making it one of the world's best-performing indices. The bull run was powered by two of his "arrows" -- huge government spending and a flood of easy money from the central bank that sent the yen plunging and brought paper profits to exporters. But the third -- structural reforms -- sits somewhat undefined in his quiver, with some commentators saying a lack of detail in plans to cut red tape and get women into the workforce has contributed to market jitters. Abe told business leaders Tuesday he wanted to stimulate the corporate investment mindset, as recent data showed Japanese firms remain cautious in their spending. "I set the next three years as a period to encourage intensive corporate investment," he said. "I will take any measures possible in the areas of tax, budget, finance or deregulation during the period, to give you the chance you need." Economy, Trade and Industry Minister Toshimitsu Motegi said the Abe administration was determined to boost corporate investment by 10 percent over the next three years. The aim is to recover it to more than 70 trillion yen ($698 billion) levels before Lehman Brothers collapsed, he said. "We will take drastic assistive measures to increase corporate investment, which will be a different scale from before, including expansion of the tax system," Motegi said. Keidanren chairman Hiromasa Yonekura said the business sector has great expectations. "Economic sentiment has improved a great deal," he said. "I think private companies will have substantial confidence" that will enable them to realise Abe's investment goal. Abe, who has urged firms to boost salaries and employ more women, is expected to give more details on his third "arrow" in an address on Wednesday.