Japan's macroeconomic policies have not been pursued with vigor and purpose. Over the past decade, changes in political leadership have been frequent, and the movement of bureaucrats between ministries, constant.
Policy makers are reluctant to assume responsibility, preferring instead to fall back on consensus.
And in the Japanese system, it takes a long time to reach a consensus, so economic reform policies are quite often untimely and without significant effect. Policies implemented tend not to be appropriate for today's rapidly changing circumstances. It is difficult to predict precisely when the Japanese economy will bottom out and then rebound to develop steadily. Yet Japan is expected to play an important role in Asia even if its economy has not fully recovered. This is because a substantial amount of bad debt suffered by enterprises in Asia is funded by Japan.