Takaichi's Instruction for a New Economic Package to Mitigate Inflation

New Economic Package Directive

Japan's Prime Minister Sanae Takaichi has instructed the preparation of a new economic measures package aimed at alleviating the increasing inflation pressure on households and companies.

Content and Financing of the Package

On Tuesday, Takaichi, Japan's first female prime minister, did not provide any information about the size of the package. However, it was noted that an additional budget would be prepared for financing the measures. The package is expected to include subsidies for electricity and gas fees during the winter months, as well as regional grants.

Support for Small and Medium-sized Enterprises

This economic package is planned to encourage small and medium-sized enterprises to increase employee wages and capital investments. Takaichi has identified rising living costs as the most important economic priority and emphasized that despite being known for aggressive monetary and fiscal support in the past, she would pursue a more responsible fiscal policy.

Long-term Issues and Responses

Takaichi faces difficult tasks in addressing concerns over Japan's massive public debt and supporting the economy. Consumer inflation continues to exceed the BOJ (Bank of Japan) target of 2%. Takaichi expressed hope that inflation will become demand-driven through wage increases rather than being caused by rising costs.

Trade Relations with the USA

The new economic package is also expected to include steps to implement the investment plan previously negotiated with Washington. As part of the agreement with the United States, Japan had committed to investing a total of $550 billion in key sectors in exchange for a reduction in customs duties.