TOKYO (AFX-ASIA) - State Minister for Economic and Fiscal Policy Heizo Takenaka said private sector machinery orders data released yesterday indicate that the Japanese economy is now moving in a positive direction. However, he added that the figure for machinery orders "is not good nor bad," adding that economic conditions are largely in line with government expectations. Yesterday, the Cabinet Office said private sector machinery orders in May rose 0.2 pct month-on-month, and upgraded its assessment of the economy, saying there are positive signs the decline in orders is close to ending. Over the weekend, Takenaka told the Japan Broadcasting Corporation (NHK) network that the government may upgrade its economic assessment if private sector machinery orders data in May turn out strong. "The Japanese economy has stopped deteriorating. The machinery orders figure confirmed that the Japanese economy is now going in a positive direction," Takenaka said today at a news briefing after a cabinet meeting. "I realise there are some risk factors at the moment, such as the unclear economic outlook in the US. But overall, I think the Japanese economy is moving in line with our expectations," Takenaka added. Takenaka said prime minister Junichiro Koizumi now wants people who strongly advocate structural reforms to work towards restructuring government-owned firms. Takenaka said the time to talk of structural reform is almost over, adding: "The time will soon come to act on reform." Asked about the year to March 2003 budget request, Takenaka said it is necessary to discuss both long-term and short-term issues, adding: "We still have to walk through a very narrow path." fd/tr