ZCZC
BCN-13
JAPAN-ECONOMY-STIMULUS
Japan unveils $120 billion stimulus package
TOKYO, Dec 5, 2019 (BSS/AFP) – Japanese Prime Minister Shinzo Abe unveiled
$120 billion in stimulus measures on Thursday, to help the world’s third
largest economy overcome the aftermath of the nation’s recent natural
disasters.
The package is also aimed at helping the nation alleviate the impact of
last month’s tax hike and survive a potential economic slowdown after an
Olympic boom.
“We will introduce a daring fiscal policy worth 13 trillion yen ($120
billion),” Abe told ministers and party leaders at the prime minister’s
office.
“We have crafted a powerful policy package,” Abe added.
The package, expected to be endorsed at a cabinet meeting later in the
day, totals some 26 trillion yen if spending by the private sector is
counted, according to public broadcaster NHK and other local media.
Under the plan, the government will spend some six trillion yen on public
investment after a series of natural disasters — including killer Typhoon
Hagibis — caused huge damage to the country’s infrastructure, local media
said.
Japan’s economy has so far expanded this year, partially because of strong
demand related to preparations for the Olympics, which will start in July
next year. Some analysts warned the country may suffer a post-Olympic slump.
The package is also aimed at easing the impact of the consumption tax
increase to 10 percent from eight percent on October 1 and helping Japanese
firms prepare for a global economic slowdown due to the US-China trade
dispute.
The Tokyo market welcomed the package.
“In particular, stimulus-related shares such as construction companies
benefited from the announcement,” Toshikazu Horiuchi, a broker at IwaiCosmo
Securities, told AFP.
But Yusuke Shimoda, economist at Japan Research Institute, warned the
impact of the package could be “limited.”
“The package is likely to boost infrastructure-related businesses, but is
unlikely to help reform the nation’s slow-growth economy fundamentally,”
Shimoda said.
The package will also include government measures to help expand exports
of farm products as a bilateral trade accord between Tokyo and Washington is
set to take effect next year, Kyodo News said.
Among other steps, the government will help people in their 30s and 40s,
who have been struggling to find work due to past economic slowdowns, to land
new jobs, it said.
BSS/AFP/HR/1245