Due to the Oil Shock... Japan to Implement Additional Economic Measures Worth Over 100 Trillion Yen

[Image source=Yonhap News]

[Asia Economy Reporter Cho Hyun-ui] The Japanese government and ruling party are pushing for an additional economic package worth 10 trillion yen (approximately 102 trillion won) to respond to the rise in crude oil prices caused by Russia's invasion of Ukraine.

On the 22nd, Sankei Shimbun reported that this package is expected to include oil price subsidies, measures to curb food prices, and support for small and medium-sized enterprises.

The Japanese government is currently providing subsidies of up to 25 yen (about 255 won) per liter to oil companies to suppress the sharp rise in gasoline prices. However, as of the 17th, the subsidy amount has already reached the upper limit of 25 yen, and with oil prices expected to continue soaring, additional funding ranging from several hundred billion to trillions of yen will be required.

Since food prices, including wheat which Japan heavily depends on imports for, have also risen significantly, the government is considering providing subsidies to ease household burdens.

Support measures for small and medium-sized businesses struggling due to rising fuel and raw material costs are also being discussed. If government-affiliated financial institutions provide loans or interest support, it is expected to cost trillions of yen.

The Japanese government plans to officially begin preparing economic measures once the 2022 budget bill is finalized at the House of Councillors plenary session this afternoon, with formal approval expected at the Cabinet meeting next month.

Sankei Shimbun stated, "Yuichiro Tamaki, leader of the Democratic Party for the People, who has recently been highlighting cooperation with the ruling party, demanded a large-scale economic package worth 10 to 20 trillion yen," adding, "Within the ruling party, there were reactions that Tamaki's demand could serve as a sort of benchmark."

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