...

Japanese companies back Kishida's plan for big fiscal stimulus: Reuters poll




  • In Business
  • 2021-10-13 23:15:16Z
  • By Reuters
 

By Tetsushi Kajimoto

TOKYO (Reuters) - Japanese firms overwhelmingly want the government to draw up an extra budget of $90 billion or more to ease the pain caused by COVID-19, a Reuters poll showed, indicating support for new Prime Minister Fumio Kishida's additional stimulus plans.

The monthly Corporate Survey results come as Kishida, who took over from Yoshihide Suga as premier last week, ordered his cabinet to compile an economic package targeting households and businesses hit hard by the pandemic.

Kishida has pledged to draw up economic measures worth "tens of trillions of yen" to revive the world's third-largest economy, which is already saddled with the industrial world's heaviest debt load. Japan's debt is more than twice the size of its annual economic output.

"All we need is proactive fiscal spending that will blow away negative impacts of the pandemic," a manager of a retailer wrote in the survey on condition of anonymity. Some retailers and face-to-face service-sector firms were among the hardest hit by the pandemic.

In a written response, some other managers sounded cautious about the spectre of politically-motivated spending as Oct. 31 elections draw near, while others voiced scepticism about effects of stimulus in boosting the economy.

"We agree on the need of measures to revive the COVID-hit economy, but we don't want pork-barrel spending," the manager of a chemicals firm wrote.

The Corporate Survey showed 87% of firms urged a large extra budget to fund the stimulus, with 40% demanding an outlay of 10 trillion-20 trillion yen and 23% calling for 20 trillion-30 trillion yen or even more.

In the survey, COVID countermeasures topped the list of spending items, picked by half the firms, followed by 15% seeking support for restaurants and tourism, 12% calling for environment steps and 10% demanding digital transformation.

"Industries facing difficulty need be rescued but that doesn't mean merely extending life" of zombie companies, wrote a manager of a transport equipment maker. "We want proactive spending in areas needed to maintain Japan's competitive edge."

Companies also called for measures to strengthen supply chains for chip making and promote factory automation and use of artificial intelligence (AI) to encourage Japanese manufacturers to shift production back home.

The Sept. 29-Oct. 8 survey canvassed about 500 large and mid-size Japanese non-financial corporations, of which some 267 firms responded.

On overseas economies, a majority of Japanese firms voiced concerns that a slowdown in Chinese economy, Japan's largest trading partner, would affect their business, as market jitters linger over Chinese firm Evergrande and real estate problems.

Two-thirds expect China's economy to manage a moderate slowdown under the state control. Some 13% said a slowdown would be temporary as the authorities are expected to roll out stimulus to accelerate the world's second largest economy.

Some 10% saw the Chinese economy bottoming out towards next spring, and just 11% expected the slowdown to morph into a financial crisis.

"It depends on how the coronavirus will be contained, but we cannot avoid impact unless demand for inbound (Chinese tourists) returns," a service firm manager wrote.

($1 = 112.3200 yen)

(Reporting by Tetsushi Kajimoto; Editing by David Dolan and Edmund Blair)

COMMENTS

More Related News

ZOZO CHAMPIONSHIP Preview
ZOZO CHAMPIONSHIP Preview

The PGA TOUR returns to Narashino Country Club in Japan for another edition of the ZOZO Championship. (Joshua S. Kelly-USA TODAY Sports)

Japan leader calls for greater military capability, spending
Japan leader calls for greater military capability, spending
  • World
  • 2021-10-18 10:52:41Z

Prime Minister Fumio Kishida called for increases in Japan's military capability and spending in response to what he described as growing threats from China ...

Vaccines, masks? Japan puzzling over sudden virus success
Vaccines, masks? Japan puzzling over sudden virus success
  • World
  • 2021-10-18 03:40:36Z

Almost overnight, Japan has become a stunning, and somewhat mysterious, coronavirus success story. Daily new COVID-19 cases have plummeted from a mid-August...

Japan PM says Fukushima wastewater release can
Japan PM says Fukushima wastewater release can't be delayed

Japan's new prime minister on Sunday said the planned mass disposal of wastewater stored at the tsunami-wrecked Fukushima nuclear plant cannot be delayed...

Japan
Japan's premier sends offering to controversial Tokyo shrine
  • US
  • 2021-10-17 05:59:16Z

Japan's new prime minister donated ritual offerings Sunday to a Tokyo shrine viewed by Chinese and Koreans as a symbol of Japanese wartime aggression, though...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

Top News: Business