Japan Approves Stimulus Budget, Gov’t Debt Increases

Japan Prime Minister Fumio Kishida’s Cabinet has approved an extra $313 billion budget for a new stimulus package pushed by the prime minister as a bid to cushion the blows of the COVID-19 pandemic to the economy.

With a total direct spending of ¥55.7 trillion ($488.8 billion), the stimulus package features handouts to households with children and financial support for medical centers and businesses.

A required ¥22 trillion for the spending will be financed by new government bonds — adding onto the highest pile of public debt in any developed nation — while ¥6.1 trillion will come from leftover fiscal budget last year, local media Kyodo News reported.

From the supplementary budget, Kishida’s administration plans to spend ¥18.6 trillion ($163 billion) in preparation for the next COVID-19 wave.

Kishida has been pushing for the fiscal package with an aim to bolster economic growth to pre-pandemic levels, while trying to meet his goal of redistributing wealth which he dubbed a “new capitalism”.

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