Japan ‘working on extra 2.7-2.9trn yen budget’

28 Nov 17

Japan will reportedly compile an extra budget worth around 2.7-2.9trn yen ($24-26bn) for the fiscal year ending March 2018. 

The budget would come with an additional bond issuance worth around 1trn yen to help fund the spending, government sources told Reuters

According to the sources, who said the plan had not yet been finalised, the government will also get together the cash reserves from the previous fiscal year’s budget and money not spent from debt servicing due to low borrowing costs.

Following the election in October, the re-elected prime minister Shinzo Abe pledged to make education and childcare a priority over fiscal reforms.

The country experienced the longest period of uninterrupted growth in more than a decade in the third quarter of this year, with a 1.4% annualised rate between July and September.

But the country’s debt is the industrial world’s heaviest debt burden at twice the size of its $5trn economy, according to Reuters.

Abe pushed back the primary budget-balancing target and promised to compile an extra spending plan worth around 2trn yen for human capital investments by the end of the year.

In September, the country’s finance minister Taro Aso said the government should set a new timeframe to achieve its budget-balancing goal by 2020/21. 

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