Japan will offer a combined value of $882 in cash and vouchers to minors today as part of a stimulus package aimed at boosting the pandemic-hit economy.
Although Japan’s ruling Liberal Democratic Party and its coalition partner Komeito disagreed on the means of the handouts, they agreed on cash payouts to low-income households.
The government is expected to use a portion of its reserve funds for the expenditure.
In his first policy speech in October, Prime Minister Fumio Kishida suggested cash payouts to those hard-hit by the pandemic valued at a total of $268 billion. But Japan will spend roughly $488 billion on those most affected by the pandemic as well as on businesses, with an annual income cap of $84,693.
In contrast to Kishida’s pledge, Komeito had called for a stimulus package targeting low-income households—indicating friction earlier on in the newly-formed government. A key task for Kishida is to shift public opinion after his predecessor Yoshihide Suga botched Japan’s pandemic response.
Expect Tokyo’s record expenditure to pull Japan’s lagging economy ahead in the short-term, but government debt to ensue in the medium term as the government has previously released a pandemic-oriented stimulus package of $3 trillion.
Wake up smarter with an assessment of the stories that will make headlines in the next 24 hours. Download The Daily Brief.
Sabrine is an Analyst for Foreign Brief and a graduate student at Yonsei University in South Korea, specializing in foreign policy and security in East Asia. Previously, she contributed as a freelance writer for online publications and worked as a sub-editor for the Daily NK.