THE restart of Japan's nuclear power industry is proving pivotal to the economic vision of the country's prime minister as soaring fuel bills after the Fukushima disaster threaten to keep the country's trade in a deeper deficit for longer.
As Japan marks the second anniversary this week of a crisis that scarred the nation, the fuel bills to pay for lost atomic output are leaving their own scars on the economy, partly owing to Abe's own making.
His mix of economic policies - dubbed Abenomics by the media - has driven the yen down sharply, thus raising the cost of imports that will weigh on the revival of a nation that has traditionally relied on exports to drive growth.
The sooner that pro-nuclear Abe can restart atomic power stations, the sooner he will return the country's record trade deficit to its long-term standing of a trade surplus and so mark a milestone in the recovery of the economy.
But in Abe's way is the country's new, independent atomic watchdog, which has said it will take as long as three years to approve restarts under safety guidelines it is drawing up.
"It's a problem for Abe because his economic policies depend partly on an export led recovery to really deliver growth and he needs to get the trade balance back to positive," said Tom O'Sullivan, a Tokyo-based energy consultant.
"He also needs to stimulate domestic demand in parallel with improving exports," O'Sullivan said, adding he believed Abe had made up his mind to restart reactors.
The Fukushima disaster, triggered by a huge earthquake and tsunami in northeastern Japan in March 2011, led to the shutdown of the country's entire nuclear power industry, which was producing 30 per cent of the country's electricity supply at the time.
Only two reactors have resumed operation, sparking huge protests against nuclear power.
Japan's fuel imports bill jumped immediately as power companies ramped up production of oil and gas-fired generators.
Just as quickly, the trade balance swung into a deficit.
Abe's push for more aggressive fiscal and monetary policy since he won a big election victory in December has added to the fuel bill by driving down the value of the yen to a 31/2 year low of 96.71 per dollar on Tuesday.
Japan, the most energy-import dependent of the world's major economies, spent about 24 trillion yen (RM778 billion) in 2012 on fuel imports, including for electricity generation, based on the official average yen rate of 79.55 to dollar, finance ministry figures showed.
That made up a third of Japan's total imports bill and towered over a record trade deficit of 6.9 trillion yen.
Should the yen fall to 100 to the dollar and stay there for the next year, Japan's purchases of oil, gas and coal from overseas would rise 25 per cent to just over 30 trillion yen, in the unlikely scenario that import volumes hold steady.
But energy imports are likely to rise as Japan faces a second complete shutdown by September when the two running nuclear plants must be idled for regular maintenance. Reuters