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Japan business circles welcome state of emergency to fight coronavirus

Hiroaki Nakanishi, chairman of the Japan Business Federation, speaks at a press conference in Tokyo on April 6, 2020. (Kyodo)

TOKYO (Kyodo) -- Business leaders in Japan welcomed on Monday the government's plan to declare a state of emergency for certain urban areas to fight the spread of the new coronavirus.

    "I think the idea was that the declaration would be issued before the collapse of the medical system," said Hiroaki Nakanishi, chairman of the Japan Business Federation, the country's most powerful business lobby known as Keidanren.

    "If the declaration is made, the public and private sectors will combine forces and deal with the situation thoroughly," Nakanishi said.

    Given that the fight against the coronavirus will likely be a long process, Nakanishi called on the government to ensure essential services and important infrastructure continue to function.

    E-commerce giant Rakuten Inc. CEO Hiroshi Mikitani, who serves as representative director of the Japan Association of New Economy, a business group comprising tech firms, has been calling for an emergency declaration given the rapid spread of the coronavirus.

    The association urged the government to do so while providing adequate economic support to citizens and businesses in a statement released Saturday, when the daily number of coronavirus infections in Tokyo topped 100 for the first time.

    Kengo Sakurada, chairman of the Japan Association of Corporate Executives, also expressed support for Prime Minister Shinzo Abe's decision, saying that the country is "in a critical situation where many lives could be at risk."

    While the declaration of the state of emergency will effectively force more commercial facilities and stores to close temporarily, the government has no legal obligation to compensate them.

    "There is a need to deliver cash to those who are suffering because of the (coronavirus pandemic) and the government needs to think of a way to support them fast," Nakanishi said.

    When the state of emergency is declared, prefectural governors will be given authority to request the closure of facilities with over 1,000 square meters of floor space such as movie theaters, large retail stores and night clubs.

    Stronger requests by the governors for residents to stay at home will also likely deal a further blow to restaurant operators and retailers.

    The government is compiling a stimulus package, including cash handouts to businesses that have been hit hard by the coronavirus pandemic.

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