Japan Approves Record US$1 Trillion Budget Amid COVID-19 Challenges

The Japanese Cabinet approved on Dec. 21 the highest budget draft of ¥106.6 trillion (US$1.03 trillion) for the next fiscal year starting in April 2021, according to the Japanese Finance Ministry.

The Japanese Cabinet approved on Dec. 21 the highest budget draft of ¥106.6 trillion (US$1.03 trillion) for the next fiscal year starting in April 2021, according to the Japanese Finance Ministry.

Exceeding the 2020 initial budget of ¥102.66 trillion (US$992.89 billion) with a four percent rise, the 2021 budget draft marks a record high for the ninth year in a row, increasing the concern over the country’s fiscal situation, especially amid the COVID-19 pandemic that has affected not only the economy of the Asian country, but also other countries around the world.

Debt will fund over 40% of the budget, higher than this year at 31.7%, but could also increase if Prime Minister Yoshihide Suga plans to take additional financial measures against the pandemic.

As of last March, Japan’s public debt was at ¥1,106 trillion (US$10.70 billion) and it is expected to increase to around ¥1,201 trillion (US$11.32 billion) in March 2021.

The budget draft came as the COVID-19 cases in Japan continue to rise, recording nearly 2,500 cases on Dec. 20 which has brought the total number of cases nationwide to 195,880.

The budget draft will be submitted to the parliament, which will hold a session in January to approve the spending plan.


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