Japan’s ruling party calls for a $ 290 billion stimulus package

FILE PHOTO: Kozo Yamamoto in Tokyo

© Reuters/Kim Kyung Hoon
FILE PHOTO: Kozo Yamamoto in Tokyo

By Leika Kihara and Takaya Yamaguchi

TOKYO, Oct 14 (Reuters) – Japan must draw up an economic stimulus package worth at least 32-33 trillion yen ($ 282-290 billion) to cushion the impact of the coronavirus pandemic, a senior declared Thursday. position of the ruling party close to Prime Minister Fumio Kishida.

This spending would be necessary to offset Japan’s output gap and meet the central bank’s 2% inflation target, said Kozo Yamamoto, an architect of former Prime Minister Shinzo Abe’s “Abenomics” stimulus policies.

“The package of measures can be financed by issuing Japanese government bonds (JGB),” said Yamamoto, Kishida’s current aide on economic policy. “The state should issue a massive amount of long-term JGB, which can be bought in a decided way by the central bank.”

Yamamoto, a former official in the Ministry of Finance, has been heavily involved in creating the “Abenomics,” a mix of massive monetary and fiscal stimulus and a growth strategy deployed in 2013 to lift Japan out of economic stagnation.

Kishida has said that he will maintain the stimulus policies of the “Abenomics”, and that he will take additional measures to distribute wealth more widely among households. The prime minister has also promised to draw up a spending package worth “several tens of trillions of yen.”

(Reporting by Leika Kihara and Takaya Yamaguchi, edited by Gerry Doyle, translated by Tomás Cobos)

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