Japan plans to render large stimulus to minimize virus damage

A budget draft showed that Japan will render a total of $1.1 trillion stimulus package. The fiscal stimulus will include large volumes of direct and emergency spending aimed at minimizing the economic disruptions brought by the novel coronavirus crisis.

The stimulus package worth 117 trillion yen, which includes 33 trillion yen for direct spending and 10 trillion yen for emergency spending, will be in line with the initial $1.1 trillion package rendered in April.

The recently drafted budget put the total amount of government spending to 234 million yen, taking up 40% of the country’s gross domestic product (GDP).

To carry out the plan, Japan has to issue an additional 31.9 trillion yen in government bonds. This needs to be filed under the second supplementary budget for the current fiscal year.