TOKYO (Reuters) – Japanese Prime Minister Yoshihide Suga instructed his cabinet on Tuesday to compile a package of stimulus measures focusing on steps to revitalise an economy hit by the coronavirus pandemic, the country’s economy minister said.
The package will consist of measures to cushion the blow from COVID-19, assist structural changes in the economy and boost productivity through digitalisation, Economy Minister Yasutoshi Nishimura said.
The government will compile the package as soon as possible, aiming to improve growth on both a macroeconomic and on a microeconomic level, Nishimura told a news conference after a regular cabinet meeting.
“We’ll want to consider government spending that will attract private investment,” Nishimura said.
Japan’s economy is expected to have rebounded in the third quarter after posting a record postwar contraction in the preceding three-month period, when a nationwide emergency over the coronavirus pandemic paralysed economic activity.
But the recovery has been patchy, due partly to weak business and household spending, keeping Japanese policymakers under pressure to further boost fiscal and monetary support.
While Nishimura said nothing has been decided yet about the size of the new package, requests from ruling party lawmakers have ranged between 10 trillion yen and 30 trillion yen (£72 billionto £217 billion).
Japan has already deployed a combined $2.2 trillion in two stimulus packages in response to the health crisis, including cash payments to households and small business loans to help them pull through the contraction.
Reporting by Yoshifumi Takemoto and Daniel Leussink, additional reporting by Leika Kihara and Kaori Kaneko; Editing by Chang-Ran Kim and Richard Pullin