Japan to Target Stable Nominal GDP Growth of Over 3 Pct

Tokyo, June 30 (Jiji Press)–The Japanese government will aim to consistently achieve economic growth of more than 3 pct in nominal gross domestic product and more than 1 pct in real GDP at an early date, according to a draft of its Basic Policy on Economic and Fiscal Management and Reform, presented at a government meeting on Tuesday. “We will thoroughly strengthen our comprehensive national power by taking advantage of the latent strength of Japan and the Japanese people,” Prime Minister Sanae Takaichi said at a meeting of the Council on Economic and Fiscal Policy. “That is the mission of the Takaichi administration.” The government plans to coordinate further with the ruling parties and aims to adopt the basic policy at a cabinet meeting in mid-July. The draft features a medium- to long-term economic and fiscal management plan for fiscal 2027 to 2040 based on Takaichi’s “responsible and proactive” fiscal policy. It calls for public-private investments exceeding 370 trillion yen in 17 strategic fields, including artificial intelligence and semiconductors, as part of efforts to increase the country’s nominal GDP to 1,100 trillion yen by fiscal 2040. To make this possible, the draft calls for a shift in the government’s budget compilation policy to one suited to reinforcing the country’s growth potential and its nominal economic size. The government will create a new investment quota for public-private investments to make the country strong and affluent, allowing necessary funds to be requested without setting an upper limit. Investments in fields of particular importance for the country’s economic security will be managed separately under a special account after securing financial resources over multiple fiscal years. The government will manage the primary budget balance over multiple years, changing its stance from aiming to achieve a surplus on a single-year basis, according to the draft. END [Copyright The Jiji Press, Ltd.]