WORLD Japan to compile 230 billion USD stimulus package

WORLD

Japan to compile 230 billion USD stimulus package

Xinhua

20:11, December 03, 2019

TOKYO, Dec. 3 (Xinhua) - The Japanese government is set to compile a stimulus package at the conclusion of negotiations this week expected to total around 25 trillion yen (about 230 billion U.S. dollars), government sources said Tuesday.

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File photo: VCG

The stimulus package, the first economic package in three years, which comprises private sector spending, is aimed at funding recovery efforts in the wake of the country being battered by a string of natural disasters, including Typhoon Hagibis, which lashed the country in October killing more than 90 people.

The package compares to the previous policy package compiled in August 2016 to the tune of 28.1 trillion yen (258 billion U.S. dollars) with sources here saying the new package will likely be approved by Japanese Prime Minister Shinzo Abe on Thursday this week.

The upcoming package will see funds allocated to bolster infrastructure and measures to support post-disaster recovery efforts, government sources said, with allocations also being made to preempt potential economic downside risks.

This risks, the sources said, include external economic issues and a possible global downturn, as well as domestic pressures following waning consumer demand in the wake of a consumption tax hike from 8 to 10 percent here, which came into effect on Oct. 1.

The package will also see funds earmarked for small and medium sized enterprises (SMEs) to increase wages at the lower tier of companies' benchmarks, the sources indicated.

They added that around 7.5 trillion yen (69 billion U.S. dollars) of the budget will come from an extra budget for fiscal 2019 as well as an initial budget for fiscal 2020. The drafting of both will take place later this month.

More than 1.5 trillion yen (around 14 billion U.S. dollars), meanwhile, will come from local governments, with the central government investment and loan program contributing 3.5 trillion yen (32 billion U.S. dollars) for infrastructure development and related projects, the sources said.

Funds will also be made available to promote information and communications in education, with allocations earmarked for providing students with access to computers and tablets by fiscal 2023 at elementary and junior high-schools here, said the sources.

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