- reaching future effects. therefore, global action and continuous efforts into the future are required if we are to overcome these externalities. various groups and organizations that make up society will need to take responsible action for the sake of the planet. firms have been acting to reduce greenhouse gas emissions under their own initiative, while at the same time maintaining their accountability to a wide range of stakeholders, such as investors and consumers, through disclosure and other means. financial institutions have also played an important role. they have been stepping up their efforts in such areas as green finance and supporting firms from the financial side. consumers have also become more conscious of the environment, using reusable shopping bags and energy efficient electronic appliances, and purchasing electric vehicles. in terms of policy responses to solve climate change issues, governments and legislative bodies play an important role. many countries have been setting greenhouse gas reduction targets and implementing initiatives to reduce greenhouse gas emissions to a socially optimal level. these 1 / 6 bis central bankers'speeches initiatives include reviewing regulations or introducing carbon pricing, such as emissions trading and carbon taxes, through which the costs of climate change will be explicitly reflected in the decision making of firms and households. the japanese government has declared its aim of reducing greenhouse gas emissions in japan to net - zero and achieving carbon neutrality by 2050. it has also stated that, under its “ green growth strategy, ” it will promote policies that contribute to growth centered on decarbonization, including carbon pricing. in this way, through the active initiatives of firms and households, together with the government ’ s measures, the externalities of climate change that were originally not recognized are now gradually becoming reflected and “ internalized ” in the decision making of a wide range of agents. the key to addressing climate change issues is how to reinforce these trends. ii. overseas initiatives in recent years, climate change has been a major issue not only at central bank governors ’ meetings, as i mentioned earlier, but also at various international forums and organizations. created under the financial stability board ( fsb ), which monitors and makes recommendations about the global financial system, the task force on climate - related financial disclosures ( tcfd ) published its final report in 2017 on recommendations for climate - related financial disclosures. these recommendations are being followed by an increasing number of firms, and japan now has the largest number of firms supporting the tcfd recommendations. also in 2017, the network of central banks and supervisors for greening the financial system ( ngfs )

but the output gap is unlikely to narrow significantly as the pace of recovery in final demand is expected to be moderate. in these circumstances, prices are expected to be stable for some time. 5. in sum, the positive cycle among production, income and expenditure continues steadily and is reflected in the improvement in corporate profits and the rise in employees ’ income. thus, despite the restraining pressures from fiscal policies, including the consumption tax hike and the decline in public - sector investment, japan ’ s economy is expected to continue its recovery, supported by the yen ’ s depreciation until early spring and the expansion of information - related demand. however, the economic recovery is unlikely to gather significant momentum, as a result of fragility in some sectors, as well as the continued balancesheet adjustment pressure. in these circumstances, building an economic environment which increases the confidence of the private sector is vital to strengthening the economic recovery. in this process, effective structural reforms to draw out the dynamism inherent in the economy continue to be essential in addition to appropriate macroeconomic policies.