Kazuo Ueda has been nominated to serve as governor of the Bank of Japan (BoJ). Ueda is professor emeritus of economics at the University of Tokyo and served as a member of the BoJ’s board between 1998 and 2005. If confirmed, Ueda will take office in April.
Although Ueda has made few statements on the topic of using monetary policy to address the risks of climate change, he appears to be dismissive.
In a 2021 article for the Nikkei, an economics-focused newspaper in Japan, Ueda argued that, while central banks can respond to climate change, doing so is more of a job for fiscal authorities, and if central banks become too involved in fiscal policy, legislators may interfere with monetary policy.
He also argued that supporting green investments with central bank funds may conflict with the need to drain liquidity from the economy when the time arises.
In the confirmation hearing before the Japanese House of Representatives, Ueda expressed the belief that the BoJ should “continue monetary easing to firmly support the economy and create an economic environment that enables companies to raise wages.”
This loose monetary policy could enable him to continue the climate efforts the BoJ began under the previous governor, Haruhiko Kuroda. In 2021 Kuroda oversaw the launch of a climate lending facility which has given out US$26bn in loans and investments for sustainable projects.
The BoJ received a D+ from the Green Central Banking Scorecard, with an aggregate score of 35 out of 130, placing it eighth of the 20 central banks reviewed. The BoJ published a comprehensive climate strategy in 2021, which includes the climate lending facility, a pilot scenario analysis exercise for the largest financial institutions, climate-aligned disclosures, and climate research.
This page was last updated March 9, 2023
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