Japan increases record emergency virus package to 1.08 trillion USD



The Japanese government on Monday increased an already record high emergency package to a fresh record to help mitigate the economic blow from the coronavirus.

The emergency package was increased from an initial 108.2 trillion yen to 117.1 trillion yen (1.08 trillion U.S. dollars), in part, so the emergency funding could cover the government's hasty decision to provide across-the-board cash handouts of 100,000 yen (about 927 U.S. dollars) to those living in Japan.

Japanese Prime Minister Shinzo Abe announced on Friday that the government will provide a 100,000 yen cash handout to all citizens regardless of their income level to help them deal with the economic impact of the coronavirus.

The one-time cash handout replaces an earlier plan to provide 300,000 yen (2,782 U. S. dollars) to households whose income had fallen to a certain level as result of the virus.

Japan's Cabinet on Monday also approved an extra budget of 25.69 trillion yen (238.22 billion U.S. dollars) for fiscal 2020, compared to an initial 16.8 trillion yen extra budget decided earlier in April.

The allocation for the cash handout will be financed by issuing more deficit-covering bonds, the government here said.

The reworked budget is now expected to be submitted to parliament on or around April 27, with its enactment coming one week after the government's original schedule on May 1, with the handouts being given out by the end of May.

The emergency package also allocates funds to the tune of one trillion yen (9.27 billion U.S. dollars) to local governments so they can provide fiscal support to businesses complying with local authorities' requests to shutter their operations until the nationwide state of emergency comes to an end on May 6, under the government's current plans.

In addition, the budget has also been compiled to make provisions so that the country's supply of the anti-influenza drug Avigan, shown to have positive effects in treating the symptoms of some COVID-19 patients, can be increased threefold at a cost of 13.9 billion yen (128.90 million U.S. dollars).

The government's latest record stimulus efforts far eclipse those made in the wake of the 2008 financial global crisis when the government rolled out an emergency stimulus package worth 56.8 trillion yen (526.74 billion U.S. dollars) to cushion the downside effects.

After the sales tax was raised from 8 to 10 percent here last October, a 26 trillion yen (241.09 billion U.S. dollars) stimulus package was approved thereafter to help counter the negative effects, also considerably less than the latest record measures. (1 U.S. dollar = 107.80 Japanese yen)