TOKYO Japan's cabinet approved on Friday 10.3 trillion yen ($116.8 billion) of stimulus spending in a bid to pursue Prime Minister Shinzo Abe's ambitious agenda to spur growth and beat deflation.
The government will spend the money on public works, incentives for company investment and financial aid for small firms, bringing a total package to 20.2 trillion yen including spending by local governments and private sector firms.
Following are some details of the stimulus package
* denotes direct government spending
** denotes overall amount including by local governments and private sector outlays
1) DISASTER PREVENTION, ACCELERATE REBUILDING FROM MAJOR 2011 EARTHQUAKE AND TSUNAMI
(*3.8 trillion yen; **5.5 trillion yen):
- Develop social infrastructure in the disaster-hit northeast, and help local residents rebuild homes and settle in by increasing reconstruction subsidies.
- Repair ageing roads, tunnels and bridges.
- Make housing, school and hospital buildings quake proof. Enhance responses by police, firefighters and the Self-Defence Forces against large-scale disasters.
2) GENERATE WEALTH BY ECONOMIC GROWTH
(*3.1 trillion yen, **12.3 trillion yen):
- Boost industrial competitiveness by subsidizing corporate investment in hi-tech equipment and energy-efficient technology to cope with energy supply after the Fukushima nuclear disaster.
- Support research and development activity and promote innovation by facilitating fund supplies to venture businesses.
- Provide financial aid to small firms to help restructuring and managerial reforms.
- Establish a fund by state-backed Japan Bank for International Cooperation (JBIC) to encourage private-sector lending to Japanese firms looking to acquire companies overseas.
- Build sophisticated investment and risk management structures for pension and other public funds.
3) SUPPORT PEOPLE'S LIVELIHOOD, REVIVE LOCAL COMMUNITIES
(*3.1 trillion yen, ** 2.1 trillion yen):
- Build reliable medical and education systems.
- Renovate infrastructure in rural cities struggling with depopulation in an ageing society.
- Launch special subsidies to help local governments quickly implement stimulus steps, revive local economy and create jobs.
4) REGULATORY REFORM TO BRING JAPAN'S ABILITY TO FULL PLAY:
- Launch a government panel to carry out bold regulatory reform in areas such as energy, environment, health and medical sectors.
5) MEASURES FOR STABILISING CURRENCY MARKETS:
- Continuously purchase securities issued by the euro zone's permanent fund European Stability Mechanism (ESM). Seek new measures for tapping foreign reserves to stabilize currency markets.
($1 = 88.2000 Japanese yen)
(Reporting by Tetsushi Kajimoto; Editing by Kim Coghill)