Amid coronavirus outbreak, Japan, the third largest economy of the world, takes new effort to boost its economy. Under the new effort, Japan will look into offering cash payouts to households as part of a stimulus package that can be more than $276 billion to combat the global fallout from the coronavirus outbreak.
Japanese Economy Minister Yasutoshi Nishimura said the stimulus package will be enough to fight against the crisis. According to him, the crisis is going to have more serious impact than when the collapse of Lehman Brothers in 2008 jolted financial markets. On Thursday, after holding a cabinet meeting, Nishimura told reporters, “We’d like to look into various possibilities including on the size of any cash payouts.” He didn’t mention any exact amount of the package.
On Thursday, the Sankei newspaper reported that Japan’s ruling coalition was considering an economic package worth more than 30 trillion yen ($276 billion) to deal with the virus fallout.
The amount is even higher as compared to last year’s stimulus package (26-trillion-yen) to ease the impact of the U.S.-China trade war on the export-reliant economy.
A senior government official told sources, “It’s a crisis situation now, so the government will likely use as much money as needed.”
Some ruling party MPs suggested reducing Japan’s 10% sales tax which may not come to effect as it will take a long time to notify the public and get retailers ready for the new tax rate. Finance Minister Taro Aso said that tax reductions may get included in the package but rolling back sales is not possible.
Japan’s economy has been affected by the virus epidemic. As of Wednesday morning, Japan has recorded 29 deaths and 868 coronavirus cases. The outbreak of the novel coronavirus has also affected manufacturing, farming and fishing industries in rural Japan.