World Economy

Japan Adopts Extra $7b Budget

Japan Adopts Extra $7b BudgetJapan Adopts Extra $7b Budget

The Japanese government is set this week to compile an extra budget worth around 778 billion yen ($7.15 billion) for reconstruction in the areas of southern Japan hit by deadly earthquakes last month, government sources told Reuters on Tuesday. The quakes on the southern island of Kyushu killed about 50 people and damaged at least 5,000 homes. The extra budget for the current fiscal year that began in April will fund the building of temporary housing for the victims, with establishment of a reserve fund of 700 billion yen to support reconstruction, the sources said. No additional bonds will be issued to fund the extra budget, which will be financed through reduced interest payments on government debt due to lower interest costs stemming from the Bank of Japan’s adoption of a negative interest rate policy, they said. Prime Minister Shinzo Abe’s cabinet aims to approve the extra budget on May 13 and have it enacted by parliament as early as May 17, the sources said.