BOJ Policy Board Member Warns of Japan's Fiscal Soundness

By Megumi Fujikawa

Bank of Japan policy board member Hitoshi Suzuki voiced concerns over Japan's fiscal path, as the nation's spending has increased to ease the impact of the pandemic.

"There is no doubt that such spending is indispensable to preventing the economy from slowing down further and bringing it back onto a growth path," Mr. Suzuki said in a speech on Thursday. "At the same time, we must be aware that fiscal resources for such spending need to be secured into the future."

Last month, the Japanese government announced a $490 billion package to support economic recovery, including cash payments to families and some smaller companies.

"In the process of securing fiscal resources to respond to Covid-19, economic activity could be significantly affected. Thus, forthcoming discussions on fiscal soundness warrant close attention," Mr. Suzuki said.

Mr. Suzuki cited the U.K. as an example, which plans to raise the corporate tax in 2023 for the first time in about 50 years to restore its fiscal health.

Write to Megumi Fujikawa at [e-mail]

(END) Dow Jones Newswires

12-01-21 2123ET