Japan to Implement Additional 767 Trillion Won Economic Measures for COVID-19 Response

Fiscal spending amounts to 40 trillion yen... Suga "Will revive the economy"

Japanese Prime Minister Yoshihide Suga
[Photo by Reuters]

[Asia Economy Reporter Jeong Hyunjin] As the spread of the novel coronavirus infection (COVID-19) in Japan accelerates again, the Yoshihide Suga Cabinet has decided to prepare an additional economic measure worth 73.6 trillion yen (approximately 767.7 trillion won) to revive the economy depressed by COVID-19.

According to the Nihon Keizai Shimbun on the 8th, the Japanese government will decide on additional economic measures including private investment at the Cabinet meeting held that day. Prime Minister Suga announced at the ruling party-government policy meeting held at the Prime Minister's Office in the morning that a total of 73.6 trillion yen worth of projects will be promoted, with 40 trillion yen of fiscal expenditure allocated.

Prime Minister Suga said, "To protect the lives and livelihoods of the people, we will maintain employment, continue businesses, and restore the economy," adding, "This budget was allocated to pioneer new growth breakthroughs including green and digital sectors. All ministries will unite and devote full efforts to implementing the new economic measures."

For the measures exceeding 70 trillion yen, the Japanese government plans to reflect 30.6 trillion yen of national funds by combining the third supplementary budget for the 2020 fiscal year (April 2020 to March 2021) and the 2021 budget. These measures include COVID-19 countermeasures, economic structural transformation in preparation for the post-COVID-19 era, and natural disaster preparedness (national land resilience). Nihon Keizai explained that 6 trillion yen, 51.7 trillion yen, and 5.9 trillion yen will be invested respectively.

As COVID-19 countermeasures, the government will increase grants exclusively for prefectures and municipalities to expand hospital beds and add funds to be used as local government cooperation funds supporting restaurants and others that comply with requests to shorten business hours. For post-COVID-19 preparations, 4.5 trillion yen will be invested in a fund supporting the maintenance of university research infrastructure, and subsidies will be funded to support reshoring (domestic return) of products and medical supplies whose production bases are concentrated overseas.

In addition, the Japanese government plans to increase contingency funds that can be used for COVID-19 response without parliamentary approval. The 2021 budget will include 5 trillion yen in contingency funds, significantly expanding from the original 500 billion yen.

The Suga administration prioritizes the economy and has not suspended stimulus measures that may risk spreading COVID-19, making the infection control effects of the additional economic measures uncertain. The number of confirmed COVID-19 cases in Japan increased by more than 15,000 in one week. Since mid-last month, the rapid increase in confirmed cases has raised concerns about the collapse of the medical system. The cumulative number of confirmed cases in Japan is 165,174.

This content was produced with the assistance of AI translation services.