D ie Japanese government has put together another multibillion-dollar stimulus package. She decided on spending the equivalent of almost 24 billion euros (3.5 billion yen), particularly among economically weak regions and households are to be supported with low incomes on Saturday. These are to receive goods and petrol vouchers.
Further financial support for small businesses are planned and reconstruction projects for areas that have been hit by the devastating earthquake in March 2011. In order to stimulate the construction activity is to offer low mortgage rates a state credit agency. With a swift implementation of the measures would succeed, “to bring the positive growth cycle in all corners of the country,” promised Prime Minister Shinzo Abe in Tokyo.
The Japanese economy is weakening since a sales tax increase in of April. Since the beginning of his first term in office two years ago, Abe has launched several stimulus packages on the way, but can not ensure stable growth in the third largest economy in the world. Real wages have actually declined.
Abe pursues an economic policy that bears his name (Abenomics), which relies on a loose monetary policy and targeted expenditure and reform measures. According to analysts, Abe improved with the new measures, the chances of success of his governing coalition in nationwide local elections in April. He was recently elected by Parliament for a second term.
According to the government’s stimulus package should push economic output by 0.7 percent. Economists, however, are skeptical that the effect will be so strong. New debt for the project should not be made.
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