Finance Minister Masajuro Shiokawa hinted that defense spending, including its financial support as host nation for the U.S. military, will be reviewed for possible cuts in the fiscal 2002 budget, a senior government official said.

“Defense spending will be subject to review,” the official quoted Shiokawa as saying at an informal gathering of Cabinet ministers Tuesday.

“So will host-nation support.”

The government earmarked 257.3 billion yen for host-nation support in fiscal 2001.

Known in Japan as the “sympathy budget,” the host-nation support program began in fiscal 1978, when the U.S. economy was foundering and Japan’s cost of living was skyrocketing on the back of a robust economy.

But as the Japanese economy has slipped into the doldrums while the U.S. economy has posted record growth, Japanese politicians have been lobbying for a cut in the program along with foreign aid and other spending areas.

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