Japan vows 'bold' steps to beat Covid-19 fallout

Tokyo

JAPAN must take "bold and unprecedented" steps to beat the economic fallout from the novel coronavirus, its economy minister said, suggesting large-scale fiscal stimulus is in the works, as the government tries to fend off a recession.

Any spending package would add to support by the Bank of Japan (BOJ), which is expected to ease policy next week to cushion the blow from the Covid-19 outbreak and shore up business confidence in the world's third-largest economy.

"The government and the central bank share a strong sense of concern" about fallout from the coronavirus, economy minister Yasutoshi Nishimura said on Friday, signalling that a mix of fiscal and monetary steps are being prepared.

Vice-finance minister for international affairs Yoshiki Takeuchi told reporters that the government and the BOJ "stood ready to work as one", as needed.

"We will watch market moves with a stronger sense of urgency and act accordingly based on the G-7 agreement," the country's top currency diplomat said after a meeting with his colleagues at the BOJ and the Financial Services Agency on Friday. The remarks came in the wake of a conference call among the G-7 nations, which underscored the group's commitment to cooperate in tackling the coronavirus.

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Japan is working on a new spending package of up to 20 trillion yen (S$264.7 billion), including cash payouts to households and subsidies to tourism companies hit by a slump in overseas visitors. REUTERS