Kyodo News reported that Japan is considering an economic stimulus package worth over 31 trillion yen ($266 billion). The country intends to ease the pain from the current pandemic. This plan would also require assigning a new debt.
Kyodo reported late on Sunday that part of the budget will come from funds shifted from last year’s budget.
This week, a government panel is likely to announce proposals that will put the main principle of the planned stimulus package. The panel is also tasked to make a plan for Prime Minister Fumio Kishida’s new style of capitalism.
Kishida promised to organize a large-scale stimulus package by the end of this month. In the meantime, by the end of this year, the government is expecting it to be passed by parliament. However, later it stopped defining the exact amount of spending and additional debt.
Last week, the Yomiuri newspaper reported the stimulus plan, including spending approximately 100,000 yen per child. In total, on cash payments, there is 2 trillion yen to households with children.
The government planned to include other measures in the stimulus package intended to support using up a resource. The result was a massive hit from the coronavirus pandemic affecting its citizens.
Some economists are now optimistic about the idea that, after the pandemic, a recovery in service-sector spending will help the world’s third-largest economy in the following months. They also hope that it will solve a persistent global supply shortage that pressures production and exports.
On Friday, the Sankei newspaper reported about the details of what the package includes. According to the report, segments expected to be in the package were a domestic tourism promotion campaign. Besides that, they intend to realize a 10 trillion yen for funding the university research.
Sankei said that the government was planning to use several resources to pay for the package. These resources include the use of around 4.5 trillion yen (left from the settling of accounts of the fiscal year in 2020) and more than 10 trillion yen in other funds carried over from the same fiscal year. Besides, they would consider issuing new debt to cover any further needs.
The newspaper said that the government plans for the fiscal year in 2021 to add the extra budget to the ordinary budget for the following fiscal year starting in 2022 as a mixed 15-month budget funding all its efforts.
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