Some encouraging structural reforms notwithstanding – let me mention here as examples the liberalisation of the electricity market and the progress in pension and labour market reforms – the Lisbon strategy fell short of its initial goals. Even if we consider the time lag between the implementation of reforms and their taking the intended effects, the increase in potential growth was disappointing.
There are many factors – both at home and abroad – exerting downward pressure on prices in Japan: an increase in cheap imports from overseas, increased distribution efficiency mainly due to deregulation, and the consequent low-price strategies of firms as well as an increased preference among households for low prices.