FILE PHOTO: People walk past an electronic board showing Japan’s Nikkei average outside a brokerage in Tokyo, Japan June 20, 2017. REUTERS/Toru Hanai/File Photo
December 14, 2017
TOKYO (Reuters) – Japan’s government is expected to cut new bond issuance for fiscal 2018 from the previous year thanks to economic recovery pushing up tax revenues, the Nikkei newspaper reported on Thursday.
Total new bond issuance will likely fall by as much as several hundreds of billion yen in the next fiscal year from the current year’s 34.37 trillion yen ($304.83 billion), the paper said without citing sources.
That would be the eighth straight year of declines in new bond issuance, offering some relief for premier Shinzo Abe’s administration that seeks to balance the need to reflate the economy and fix Japan’s tattered finances.
A strengthening economic recovery will likely boost tax revenues for next fiscal year by roughly one trillion yen to near 59 trillion yen, which would be the highest level in 27 years, the Nikkei said.
That would mask the structural issues that hamper Japan’s efforts to rein in its huge public debt.
Total expenditures will rise to around 98 trillion yen, setting a new record for the sixth straight year, due mostly to rising social welfare costs in a rapidly aging society, the paper said.
The Ministry of Finance will compile the draft of next fiscal year’s budget for approval by the cabinet on Dec. 22.
Japan’s economy expanded expanding an annualized 2.5 percent in July-September to mark the best uninterrupted run of growth in 16 years, thanks to robust exports and capital expenditure.
The government is expected to revise up its economic growth forecast for next fiscal year, which serves as a basis for compiling the budget, to 1.8 percent from 1.4 percent, the Nikkei said.
(Reporting by Leika Kihara; Editing by Eric Meijer)
