Japan’s prime minister orders cabinet to prepare bailout package to combat soaring prices According to Reuters

By Kentaro Sugiyama and Daniel Leussink

TOKYO (Reuters) – Japanese Prime Minister Fumio Kishida on Tuesday ordered his cabinet to come up with a new bailout package by the end of April to cushion the economic blow from rising fuel and raw materials prices.

The package will likely include an extension of gasoline subsidies for oil distributors, as well as other steps to ease pressure on companies and households due to rising raw material costs.

Kishida told ministers in his cabinet: “We need to prevent the high prices of fuel, raw materials and food from having a major impact on people’s livelihoods and economic activities.” broadcast.

For now, the government will set aside special reserves in the fiscal 2022 budget to finance spending measures, Mr. Kishida said.

The special reserve of 5.5 trillion yen ($44.41 billion) is mainly set aside for emergency spending in response to the COVID-19 pandemic.

Kishida is under pressure, including with the party’s ruling coalition partner Komeito, to budget more, rather than rely solely on reserves, to scale up spending on the bailout.

Economy Minister Daishiro Yamagiwa told reporters: “The prime minister’s order is to come up with ways to support not only companies but also households.

Rising fuel and raw material prices have put additional strain on Japan’s economy, which has left other countries lagging behind in sustaining a recovery to the impact of the pandemic.

Political pressure over major fiscal spending is expected to mount ahead of summer senate elections, which Kishida must win to consolidate power in his ruling Liberal Democratic Party.

(1 dollar = 123,8400 yen)