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Economy

Japan to double fiscal stimulus to 6tn yen

TOKYO -- Japan looks to inject 6 trillion yen ($56.7 billion) in direct fiscal outlays into the economy over the next few years, double the amount initially planned.

The fiscal stimulus package, to be funded through a supplementary budget, the fiscal 2017 spending plan and other lending facilities, will be announced as early as Aug. 2.

The Ministry of Finance firmed up the plan on Monday. An earlier draft presented to Prime Minister Shinzo Abe included 3 trillion yen in central and local government spending, but the amount was doubled in light of calls for more generous spending from the government and ruling party lawmakers.

Funding will come in several stages. The supplementary budget for fiscal 2016 will likely provide around 2 trillion yen, including 1.3 trillion yen or so for public works. The fiscal 2017 national budget will set aside more. The overall package, including loans to businesses, could exceed 20 trillion yen.

The plan covers four areas. Policies aimed at maximizing labor participation are first on the list. This includes an overhaul of Japan's employment system, such as instituting limits on overtime work and longer parental leave. Employees will also be able to draw pensions after fewer years at a company.

Infrastructure investment is second. Efforts promoting tourism, including plans to build such facilities as docks for large cruise ships and deregulation to spur hotel construction, will be announced by year-end. Funds will also be set aside for maglev and bullet train projects under the government's fiscal investment and loan facility.

Softening the blow of the U.K.'s departure from the European Union is also on the list. The Japan Bank for International Cooperation will give borrowers two years longer to repay loans used to develop overseas operations, part of measures to keep small and midsize businesses solvent.

Lastly, a fund will be created to aid recovery from the major earthquakes that rocked southwest Japan earlier this year. Tighter anti-terrorism measures are planned as well.

(Nikkei)

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