Japan’s new budget to include $302 billion in direct spending

Japan's new budget to include $302 billion in direct spending - Mainichi

Japan’s government plans to include $302 billion in direct spending under a second extra budget to be compiled on Wednesday, to cushion the economic blow from the coronavirus pandemic, the Mainichi newspaper reported.

The 32.5 trillion yen ($302 billion) in spending will be part of a 110 trillion yen stimulus plan, which will be funded by the second extra budget, the paper said, without citing sources.

The amount would exceed the 25.6 trillion yen in direct spending appropriated under the first extra budget, as the hit to the world’s third-largest economy deepens.

Combined, the government has pledged over 58 trillion yen so far to battle the fallout from the health crisis, which will involve the issuance of additional government bonds, the paper said.

Japan compiled a record 117 trillion yen stimulus package in April that centred on cash payouts to households and steps to cope with the immediate damage from the pandemic.

Given the widening fallout from the virus, Prime Minister Shinzo Abe had ordered his cabinet to compile on Wednesday another stimulus plan funded by a second extra budget for the current fiscal year that began in April.

At a news conference, Abe said the total amount of stimulus from two economic packages would exceed 200 trillion yen – about 40% of Japan’s gross domestic product.

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