This article explores the factors contributing to Japan's economic stagnation, such as deflation, an aging population, the rise of China, high public debt, and structural rigidities. It discusses potential policy responses to help turn around the Japanese economy such as increasing domestic consumption through tax cuts, reducing public debt, reforming labor regulations, encouraging entrepreneurship, increasing foreign investment and reforming corporate governance structures. With concerted efforts from both private and public sectors, it is hoped that Japan will return back onto path towards sustained prosperity and higher living standards.