Japan's PM Yoshihide Suga signals readiness for new stimulus package amid Covid-19 outbreak

Japanese Prime Minister Yoshihide Suga said he would instruct his Cabinet on Nov 10 to begin work on a third extra budget. PHOTO: REUTERS

TOKYO (REUTERS) - Japanese Prime Minister Yoshihide Suga said the government will do all it can to help the economy recover, signalling his readiness to compile another stimulus package to cushion the blow from the coronavirus pandemic.

Laying the groundwork for more spending, private sector members of a key government council urged Mr Suga's administration to put together measures to support the economy, funded by an extra budget of "sufficient size", by the end of the year.

"We'd like to come up with measures to put Japan's economy back on a recovery path by deploying all available means in a timely fashion," he told the council's meeting on Monday (Nov 9).

In a separate meeting with ruling party executives, Mr Suga said he would instruct his Cabinet on Tuesday to begin work on a third extra budget, Jiji news agency reported.

After posting its worst post-war contraction in the second quarter, Japan's economy is expected to have rebounded in the three months through September.

But the recovery has been fragile, keeping policymakers under pressure to top up fiscal and monetary support.

Although the size of the package has yet to be decided, requests from ruling party lawmakers have ranged between 10 trillion yen (S$129 billion) and 30 trillion yen.

That will come on top of a combined US$2.2 trillion (S$3 trillion) rolled out in two earlier stimulus packages this year, which would strain Japan's already tattered finances.

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