Friday, August 9, 2013

Gov't pledges to slash public spending by Y8 tril over 2 years ‹ Japan Today: Japan News and Discussion

The Japanese government on Thursday pledged to cut a whopping 8 trillion yen out of its budget over two years as it works to bring down the industrialized world’s biggest debt mountain.

The move—amounting to an average reduction of more than 4% of current annual spending—comes days after the International Monetary Fund (IMF) warned again over Tokyo’s borrowings.

The budget pledge was outlined in the government’s mid-term fiscal plan, which called for 8 trillion yen to be lopped off Tokyo’s deficit between April 2014 and March 2016. There were few details about where the reductions would be made.

The projections come as Prime Minister Shinzo Abe’s administration works to boost the world’s third-largest economy after years of tepid growth.

Japan’s annual budget is about 93 trillion yen, with some 40% of that spending coming from borrowing which has created a debt pile that is more than twice as big as the nation’s economy—the worst among industrialized nations.

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Comment: So much for Abenomics and weakening the Yen against the dollar!

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