Although no details of Japan’s fiscal stimulus have been formally announced, a decision on the size and content of the much-anticipated package is expected next week.
The government yesterday submitted a list of projects to the Liberal Democratic Party, although the document did not provide specifics on the potential size of the spending package or how it will be financed.
The Nikkei Shimbun yesterday reported that the plan would include ¥6 trillion (US$57 billion) of new spending, although only about ¥2 trillion of that would be in a supplementary budget to be passed this year.
“I don’t think the headline is very important, because there’s a lot of smoke and mirrors in what they put in the headline,” said Robert Feldman, chief economist at Morgan Stanley MUFG Securities Co in Tokyo. “I would actually encourage investors to focus on the so-called real demand component,” which requires going “item by item by item and calculate what’s going to be spent, when it’s going to be spent.”
The Japanese Cabinet is to make the final decision on Tuesday next week, Kyodo News said.
Looking at the political calendar, it is likely for the package to win approval in the parliament some time in October, with money starting to flow from late this year into next year.
The draft plan also calls for continued cooperation with the Bank of Japan in efforts to revive the economy. The document says the government hopes the central bank will achieve its 2 percent inflation target.
In the days after Japanese Prime Minister Shinzo Abe’s ruling coalition won a big victory in the upper-house election on July 10, he ordered that a stimulus package be compiled, as he seeks to revive economic growth.
He specified spending on regional infrastructure, such as bringing forward the construction of maglev and other high-speed train lines, and improving facilities at ports for tourist cruise ships.
Abe also met with former US Federal Reserve chairman Ben Bernanke and told him he wants to speed the nation’s exit from deflation, underscoring his commitment to stimulus.
The government was discussing supplementary spending of about ¥3 trillion for the current fiscal year, two officials familiar with the talks said last week. Japanese Chief Cabinet Secretary Yoshihide Suga in a recent interview ruled out issuing deficit bonds to fund a stimulus package, instead hinting at using construction bonds for longer-term investments.
The markets have been expecting some spending package from the government. Partly because of speculation about the stimulus plan, Japan’s TOPIX has risen 8 percent since the upper-house election. During the campaign Abe pledged to work toward raising Japan’s GDP to ¥600 trillion from ¥500 trillion, and a well-constructed initiative could provide a boost for economic growth.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
US CONSCULTANT: The US Department of Commerce’s Ursula Burns is a rarely seen US government consultant to be put forward to sit on the board, nominated as an independent director Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday nominated 10 candidates for its new board of directors, including Ursula Burns from the US Department of Commerce. It is rare that TSMC has nominated a US government consultant to sit on its board. Burns was nominated as one of seven independent directors. She is vice chair of the department’s Advisory Council on Supply Chain Competitiveness. Burns is to stand for election at TSMC’s annual shareholders’ meeting on June 4 along with the rest of the candidates. TSMC chairman Mark Liu (劉德音) was not on the list after in December last