TOKYO, Nov 12 — Japan's government will pledge to increase spending "without hesitation" to support an economy on the cusp of emerging from stagnation, according to a draft of Prime Minister Sanae Takaichi's stimulus package seen by Reuters today.
While the draft does not specify the size of spending, it calls for "bold and strategic" investment in crisis management and growth areas, a sign that the package would likely include sizeable expenditures.
Describing Japan's economy as in a transition period from one "prone to deflation and cost cuts," the government will vow to spend "boldly without hesitation on necessary policies".
The package will include subsidies to lower utility and gasoline bills, aid to businesses hit by higher United States tariffs and an expected increase in defence spending.
The draft adds that the government will also promote investment in key growth areas like artificial intelligence (AI), semiconductors, and shipbuilding.
Takaichi's administration is expected to finalise the package later this month and compile a supplementary budget for the current fiscal year to finance part of the spending.
"The size of the package will be quite large, as Japan's economy still needs fiscal support and the long list of areas the administration promises to invest in," analysts at Daiwa Securities said in a research note.
"We would not be surprised if spending financed by the extra budget reaches ¥20 trillion (RM549.2 billion)," they said.
