Japan Govt under Pressure to Amend Fiscal Soundness Goal
Tokyo, Nov. 23 (Jiji Press)--The Japanese government is coming under strong pressure to revise its goal of balancing the budget by fiscal 2025, due to expected calls from the ruling bloc for further fiscal spending in the run-up to a triennial House of Councillors election next summer.
Currently, the government aims to bring the primary budget balance for the central and local governments to a surplus by fiscal 2025. A primary budget surplus means that a government can finance its spending on policy measures, except for debt-servicing costs, without issuing new debt.
According to estimates by the Cabinet Office in July, the government is unlikely to achieve the goal until fiscal 2027 even under a scenario of high economic growth of more than 3 pct annually in nominal terms.
The panned issuance of deficit-covering government bonds to finance the government's new economic stimulus package is likely to push back further the achievement of the fiscal reconstruction goal.
The government of Prime Minister Fumio Kishida drew up on Friday the stimulus package including fiscal expenditure of a record 55.7 trillion yen to cushion the economic blow of the novel coronavirus crisis.
[Copyright The Jiji Press, Ltd.]