Japan OKs record stimulus package to fix economy

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JAPAN’S Cabinet approved on Friday a record 56 trillion yen ($490 billion) stimulus package, including cash handouts and aid to ailing businesses, to help the economy out of the doldrums worsened by the coronavirus pandemic.

“The package has more than enough content and scale to deliver a sense of security and hope to the people,” Prime Minister Fumio Kishida told reporters.

The proposal from Kishida was set for Cabinet approval later in the day, but still needs parliamentary approval. Kishida has promised speedy action, and parliament is expected to convene next month.

The plan includes doling out 100,000 yen ($880) each in monetary assistance to those 18 years or younger, and aid for ailing businesses, Kishida and other politicians said.

Japan has never had a full lockdown during the pandemic and infections remained relatively low, with deaths related to Covid-19 at about 18,000 people. But the world’s third largest economy was already stagnating before the pandemic hit.

Under the government’s “state of emergency,” some restaurants closed or limited their hours, and events and theaters restricted crowd size for social distancing. A shortage of computer chips and other auto parts produced in other Asian nations that had severe outbreaks and strict lockdowns has hurt production at Japan’s automakers, including Toyota Motor Corp., an economic mainstay.

The government has been studying restarting the “GoTo Travel” campaign of discounts at restaurants and stores, designed to encourage domestic travel. The campaign, which began last year, got discontinued when Covid cases started to surge.

Some critics have said the government approach amounts to “baramaki,” or “spreading out handouts,” which could prove ineffective in generating growth in the long run. Others say the proposed cash aid leaves out families without children and other poor. (AP)

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