I would like to briefly touch upon recent concerns about a hollowing out of domestic industries, which are also related to the economic metabolism. To start with, expansion of production overseas is not unique to the current phase but rather a trend that has played out over the past twenty years (Chart 10).
If the reason for missing the budgetary target is that the economy has slowed down, and tax revenues have gone down, and the government has stood by its expenditure plans, it’s not obvious that they should try to reduce the deficit at that point.