TOKYO (MNI) – In the face of the yen’s rise and slowing overseas
demand, Japanese Prime Minister Naoto Kan plans to draft another set of
stimulus measures in a bid to underpin the economy, the Nikkei and other
media reported on Tuesday.
On Monday, Kan told Economy and Fiscal Policy Minister Satoshi
Arai, Finance Minister Yoshihiko Noda and Minister of Economy, Trade and
Industry Masayuki Naoshima to examine the current economic conditions
and report back with specific proposals.
Japan’s preliminary real gross domestic product showed a tepid 0.4%
growth in the April-June quarter, while a strong yen and weak stocks
threaten to derail the economic turnaround.
“We need to closely monitor developments, along with currency
conditions,” Kan told reporters.
The stimulus steps could include extending such consumer spending
incentives as the reward program for energy-saving electronics, which is
set to expire at the end of December. Programs to support job-hunting
graduates and measures to aid small businesses beleaguered by a strong
yen are also believed to be in the works.
The government is expected to have around Y900 billion in leftover
funds in the fiscal 2010 budget originally earmarked for the economic
crisis and regional revitalization. And an additional Y800 billion of
surplus money from the fiscal 2009 budget gives it a combined Y1.7
trillion to fund additional stimulus.
But government officials are reluctant to increase bond issuances,
citing concerns about the nation’s deteriorating finances.
tokyo@marketnews.com
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