The Japanese government decided Friday on a new relief package to cope with accelerating inflation, featuring a 50,000 yen cash handout program for about 16 million low-income households and steps to keep gasoline and imported wheat prices at current levels.
Prime Minister Fumio Kishida also instructed officials to draw up a more comprehensive economic package next month, as economists expect slower growth for the world’s third-largest economy due to higher import prices, largely blamed on Russia’s war in Ukraine and a relentless drop in the yen.
To finance the package, the government plans to submit a draft supplementary budget to an extraordinary parliament session in the fall, hoping to secure its passage by the end of the year.
The government has started making arrangements to convene the Diet session in early October, sources with knowledge of the planning said.
“To realize the passage within the year for sure, it is preferable to convene the Diet in October at an early date,” a senior government official said.
The decision to craft the relief package comes at a critical time for Kishida as he faces some of the biggest challenges of his roughly 11 months in office — falling public support amid scrutiny over a state funeral for the late former Prime Minister Shinzo Abe and the ruling party’s ties with the controversial Unification Church.