Japan announces larger than expected stimulus measures
Japan prime minister Shinzo Abe spends big to ward off recession
Japan has announced stimulus measures to combat its recent economic slowdown. The measures come after exports slump, a slew of national disasters and a sales tax increase at the start of October.
The economy grew in the first three quarters of 2019 but it is forecast to shrink 2.7 per cent this quarter.
It is hoped the ¥13.2tn ($121bn, £92bn, €109bn) 15-month preventative package will boost economic growth by around 1.4 per cent as well as aiding disaster relief and preparing for longer-term post 2020-Olympics growth.
The plan includes investment in research and development, particularly in mobile communication technologies, and more support for small and medium-size businesses. The stimulus also means the Bank of Japan can press pause on its monetary easing policy.
Nonetheless, economists remain sceptical about whether the measures will do the job. Bloomberg economist Yuki Masujima said the moves were positive but “won’t be sufficient to prevent a significant slowdown in 2020.”
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