Press Conference by the Chief Cabinet Secretary (Excerpt)

Q&As

• Economic measures

REPORTER: I would like to ask a question in relation to economic measures. This afternoon, Acting Secretary General Azumi of the Democratic Party of Japan (DPJ) appeared on a TV program and stated that it is a fact that the economy is contracting and that a large supplementary budget could be compiled as early as in the current Diet session if the ruling and opposition parties are able to carry out proper discussions. What are the Government's current thoughts regarding the need for putting together this supplementary budget and its timing?

CHIEF CABINET SECRETARY FUJIMURA: As I explained briefly in my response this morning, in terms of the outlook for the Japanese economy, due to the slowing of the global economy, the contribution by external demand is weak and therefore movements toward economic recovery would pause for the time being. Then, steady implementation of reconstruction measures is hoped to prop up the economy and over the next year we also expect a mild upturn in the global economy. Thus, from a slightly optimistic viewpoint, it is expected that the Japanese economy will make a moderate recovery. With regard to economic measures, this too is a matter which I discussed in my response this morning. I believe I mentioned three rounds of economic measures. There are the economic measures which utilize Government reserves, announced at the end of October. Then, there are the economic measures which I believe will be slightly larger than the first round that will be decided by the end of this month. In addition, there is the Bank of Japan and the Government's common understanding to work closely together. These three rounds of economic measures are being steadily advanced at this time as measures which are quite substantive. In regard to the compilation of the supplementary budget on this basis, as I have stated repeatedly, the supplementary budget for the initial budget pertaining to the special provisions concerning the issuance of government bonds for the payment of pensions must be compiled within the end of the fiscal year. The timing of this or the specific content and size of the budget will be considered in light of the status of the deliberations on the bill on special provisions concerning the issuance of government bonds, also bearing in mind, of course, the economic measures, the financial situation, and the financial reserves at the time. This is the Government's official view at this time. I do not know in detail with what intention and how Mr. Azumi made his statement.

REPORTER: Related to this matter, I understand that you cannot yet comment at this time on the specifics of the supplementary budget, including its content and size. However, I find it slightly strange that the Government has not issued any message at all today regarding the final government spending on economic measures despite knowing quite a bit in advance that the economic indicator will worsen considerably, including from private studies. What is your opinion on this?

CHIEF CABINET SECRETARY FUJIMURA: There are at least three economic measures about which I have spoken repeatedly. For the first round of economic measures, which has already been decided at the end of October, over 450 billion yen will be funded by national expenditure, with the stimulus totaling in excess of 750 billion yen. Then, there was the statement of common understanding between the Government and the Bank of Japan. And now, the next round of economic measures is being put together, which will be decided by the end of this month. In addition, a meeting of the Council on the Economic Situation including the Issue of Overcoming Deflation will be held this evening. It is a fact that the Government is steadily putting together economic measures.

REPORTER: With regard to the three economic measures you mentioned, does the Government believe that it is sufficient to finalize only the second of the three measures - the portion of the economic measures which will be compiled by the end of this month? Or does the Government believe that after the measures are compiled, it then should immediately compile the supplementary budget necessary to fund the measures by the end of the year? What are your thoughts on this?

CHIEF CABINET SECRETARY FUJIMURA: The economic measures which will be compiled by the end of November will not only be compiled but also executed. While this will depend on the status of the deliberations on the Government reserves and the bill on special provisions concerning the issuance of government bonds, if this bill is passed, it will become possible to boldly utilize Government reserves to a certain extent.

(Abridged)