(Bloomberg) Japanese prime minister Fumio Kishida delivered the 36 trillion yen or $316 billion in economic recovery package on Friday, the biggest funding in the country’s history.
The economic package was accompanied by the approval, by the cabinet, of about 22 trillion yen of government bonds to cater for the spending.
The package includes at least a trillion yen in cash transfers and several trillion aid to businesses ravaged by the pandemic.
The economic stimulus has attracted criticism, with analysts questioning the untimely spending. The analysts say the spending comes when Japan’s economy is set to rebound, with most restrictions having been lifted.
Japan’s Finance Minister Shunichi Suzuki acknowledges that the spending will put the Asian country into some fiscal stress amid the rising domestic debt.
Moody’s Investors Service Inc. still maintains a stable outlook on Japan, saying that its strong private sector and domestically owned bonds makes the situation manageable.
Japan’s debt will hit 257% of GDP in 2021, the highest in the developed world, without taking into account the current economic package.
Nikkei 225 is down -2.53%, USDJPY is down -1.80%.
