Japan’s premier hopefuls pledge more spending to support economy

TOKYO: Japan will likely see another stimulus package under a new prime minister, with several candidates running in the ruling party’s leadership race pledging fresh spending measures to boost growth and cushion the blow to households from rising inflation.

In announcing his intention to run in the race to replace incumbent Prime Minister Fumio Kishida, Chief Cabinet Secretary Yoshimasa Hayashi said on Monday he would prefer boosting spending, rather than cutting taxes, if the economy requires another stimulus package.

Another candidate and minister in charge of economic security, Sanae Takaichi, also called for more fiscal spending to strengthen the economy.“Strategic deployment of fiscal spending will increase jobs, household income, and improve consumer sentiment. It will also increase tax revenues without raising the tax rate and help build a strong economy,” Takaichi told a press conference on Monday to announce her intention to run in the leadership election.

The remarks followed those by leading candidate, Shinjiro Koizumi, on Friday that he would “immediately” work on a new economic package to aid small firms and low-income households hit by rising living costs.

“I’ll aim to beef up the underlying strength of the Japanese economy so that growth can be attained even in an era where inflation and higher interest rates co-exist,” Koizumi said.The winner of the Liberal Democratic Party’s (LDP) leadership race, scheduled on Sept 27, will become next prime minister due to the party’s control of parliament.Kishida announced last month that he would step down as LDP chief in Sptember, effectively ending a three-year term as leader of the world’s fourth-largest economy.