Japan: Another stimulus package worth billions
Japanese Foreign Minister Yoshimasa Hayashi, Prime Minister Fumio Kishida and Seiko Noda, Minister for Regional Revitalization, attend a cabinet meeting. Photo: – / kyodo / dpa
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Japan’s economy has collapsed due to the Corona crisis. Since the beginning of the pandemic, the state has pumped more and more money into the economy. Another economic stimulus plan should bring growth.
Japan’s cabinet has approved a new economic stimulus package with planned expenditures at record levels to stimulate the corona-plagued economy.
The third package since the beginning of the pandemic provides for 55.7 trillion yen (about 430 billion euros) in spending. The total volume of the program rises to just under 79 trillion yen if funds from the private sector are included, the Japanese news agency Kyodo reported on Friday.
Families and small companies should benefit
The most important planned relief measures by the government include cash grants and vouchers worth 100,000 yen for children up to 18 years of age who come from a household with an income of less than 9.6 million yen (74,500 euros) annually. In addition to families and young people, small businesses should also benefit from the aid. The monthly wages of carers, nurses and staff in preschools are to be increased by up to three percent compared to the current level.
The government also wants to support the construction of modern semiconductor factories in order to secure supplies of computer chips. The most recent problem has been the lack of chips, which is curbing exports from the auto industry, which is so important for Japan. With a new subsidy program for oil suppliers, the government also wants to control the price increase for fuel and other products if necessary. This should primarily relieve the burden on private households and companies.
Will you soon be back on the path to growth?
Japan’s new Prime Minister Fumio Kishida expressed the hope that the planned stimulus measures will push up the gross domestic product of the third largest economy by 5.6 percent. “We will rebuild the economy hit by the pandemic and put it on the growth path as soon as possible.” Before his election as head of government, Kishida, who has only been in office since the beginning of October, had promised a “new capitalism” aimed at narrowing the gap between rich and poor.
In order to finance the new economic stimulus package, the government is expected to submit a supplementary budget to parliament with a volume of just under 32 trillion yen before the end of the year. According to expert estimates, it could take the Japanese economy years to fully overcome the effects of the global pandemic. Due to lower exports and continued weak demand from private households, the economy contracted more significantly in the third quarter than economists had expected.