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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: Ramsey Su who wrote (6512)	9/18/1998 3:59:00 PM
From: Sam	Respond to of 9980

Ramsey, all, Japanese employees were guaranteed 5.5%, then it was 5% GIC for their pension plans (I too am going by memory here, but its in the ballpark). Only in the past year or so have they started to lower them, as they finally stopped believing that their problems were short term. This thread discussed this a couple of months ago, I think, when various companies lowered them to around 2-3%. Still very high by Japanese standards. Reality slowly closing in. Inch by inch. US companies are better off, though, since so many of them have gone to 401Ks over the past decade, and actually closed their old defined benefit programs.

To: Ramsey Su who wrote (6512)	9/20/1998 10:37:00 AM
From: Tundra	Read Replies (1) \| Respond to of 9980

Ramsey, The following is a short article regarding Japan pension payments. Japan's Health Ministry Proposes 20% Cut in Pensions by 2026 Tokyo, Sept. 20 (Bloomberg) -- Japan's Health and Welfare Ministry drafted a pension reform plan proposing to reduce total pension payments by an average of 20 percent by the year through March 2026, when the aging of Japanese society will peak, the Daily Yomiuri reported, without citing sources. According to the ministry's calculations, the total amount of pension payments is expected to rise from 26 trillion yen ($196.5 billion) next year to 45 trillion yen in the year starting April 2025 if payouts to retirees remain at current levels. The plan aims to achieve the 20 percent cut by reducing pensions paid to those 65 or older by about 10 percent from the current level and abolishing the sliding wage scale under which pension payouts increase along with rises in income, the paper reported. Japanese companies are likely to have difficulties making pension payments because their pension funds aren't yielding much as a result of low interest rates in Japan, Moody's Investors Service said in July. (Daily Yomiuri, 9/20, p.2) All Japanese newspaper citations refer to local morning editions unless otherwise indicated. 0