Japan OK’s funds for $1.1 T stimulus to fight pandemic woes

Japan’s Cabinet has approved a proposed 32 trillion-yen ($296 billion) supplementary budget to help fund measures to cushion the blow to the economy from the coronavirus pandemic

TOKYO — Japan’s Cabinet approved a proposed 32 trillion-yen ($296 billion) supplementary budget Wednesday to help fund $1.1 trillion in measures to cushion the blow to the economy from the coronavirus pandemic.

The extra funding under consideration includes support for small businesses, funding for improved medical systems and subsidies for local governments. The budget also will pay for measures to help prepare for possible future waves of infections.

Japan’s economy, the world’s third largest, slipped into recession in the last quarter and was already slowing before the pandemic hit thanks to weakening global demand and consumer spending.

The combined stimulus enacted so far amounts to a total of more than 230 trillion yen ($2.1 trillion), or about 40% of Japan‘s economy, Prime Minister Shinzo Abe told a meeting of officials on Wednesday.

“I will defend the Japanese economy at any cost against this once-in-a-century crisis,” Abe said.

A pandemic state of emergency still in effect for Tokyo and several other areas ended Tuesday as the government began trying to get back to business.

The government only imposed voluntary requests for people stay home, but the precautions hit consumer spending and other business activity. The virtual shutdown of tourism has also taken a huge toll, while the global economic fallout from the pandemic is hammering businesses everywhere.

Japanese are still being asked to take care to avoid spreading the coronavirus, which has infected more than 16,650 people in Japan and killed 858.

The finance minister, Taro Aso, said quick action was needed, noting that it would likely take a long time for things to get back to normal.

“Under such conditions, we need to firmly protect businesses that are continuing to operate, and employment, and to be fully prepared for any so-called ‘second wave,’” he said.