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S&P Upgrades Outlook for Japan; ANA Launches New Low Cost Airline - 2004-03-26


Japan is getting a new low-cost airline, and the government has expressed dissatisfaction with a credit rating change.

International credit ratings agency Standard and Poor's has upgraded its outlook on Japan, revising it to "stable" from "negative." The move follows a string of downgrades that stemmed from concerns over heavy government spending and the creation of massive debt. S&P says corporate restructuring and a deflation-fighting monetary policy have helped improve Japan's growth prospects.

But Japanese government spokesman Yasuo Fukuda says Tokyo remains dissatisfied with the outlook on its sovereign debt. He says he is not happy, because the old rating was too low and did not reflect the improving Japanese economy. He says the new rating is still too low.

Even though Japan's economy is showing signs of strength and is growing at its fastest clip in 13 years, public debt remains more than $6 trillion.

Japan's top television networks have agreed on a terrestrial digital standard, aimed at beaming high quality video to mobile phones.

Japanese TV giant NHK, along with five other networks made the agreement with MPEG LA, a group in the United States representing several technology patent holders who are key to the deal.

The television networks will broadcast the new service free, but mobile phone companies have not formally agreed to offer it to subscribers. Last year, Japan became the 12th nation to begin terrestrial digital broadcasting, with services offered in the three largest metropolitan areas - Tokyo, Osaka and Nagoya.

In the aviation sector, All Nippon Airways, or ANA, is setting up its own low cost airline - a move that many of the world's big carriers have already made. The new airline will operate low cost flights on small airplanes between regional airports in Japan.

ANA's goal is to better compete with its rival Japan Airlines System, which already has a similar low cost flight company, called JAL-Express.

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