Japanese Prime Minister Highlights 2022 Priorities

PM Kishida outlines record-breaking stimulus package. . . 

On Monday, the government of Fumio Kishida submitted a C$619.4-billion (55.7 trillion Yen) supplementary budget to the country’s Diet (parliament) and gave a long and comprehensive speech to an extraordinary Diet session to explain the new budget measures. The budget includes a record-breaking stimulus package that was endorsed by cabinet last month. It now needs to be approved by the Diet in the extraordinary session that will run until December 21. Further, Kishida explained how his government would fight the Omicron variant and laid down his priorities for 2022 and beyond.

COVID-19, defence, economic stimulus, and more . . .

On Omicron, Prime Minister Kishida explained the importance of assuming the worst-case scenario and that his government planned to be proactive in dealing with the latest variant. He announced a series of actions, including increasing hospital capacity and improving access to testing and oral anti-COVID drugs. On the economy, he said his government would continue supporting individuals, families, and businesses facing hardship through subsidies and grants. The PM highlighted his government’s plan to build back a sustainable economy through innovation, increased digitization, and investment in renewable and clean energy. His government will support wage increases to catalyze economic growth through domestic consumption and foster what he labelled a “new form of capitalism.” On security, Kishida promised to strengthen national defence and to reinforce the country’s alliances with the U.S. and other like-minded countries.

Japan’s economic recovery in peril?

In its latest economic outlook, the OECD projected the Japanese economy will grow by 1.8 per cent in 2021 and by 3.4 per cent in 2022. However, these projections assume the stimulus package is enacted and that Japan can control the spread of the Omicron variant. Japan's economy has not rebounded as strongly in 2021 as many other countries, and domestic consumption fell. The remainder of the extraordinary session will allow parliamentarians to debate how the supplementary budget will be used, which, along with how the government is able to control the latest variant, will be crucial for Japan’s economic recovery.