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Japan’s outstanding debt rose 4.9 percent from a year ago to a record 703 trillion yen as of March 31, the government said Friday.

At 1.4 times gross domestic product, Japan’s public debt burden is the highest in the industrialized world. Per person, the government’s liabilities total 5.5 million yen.

Japan’s debt has risen in recent years despite cuts to the country’s bloated public works budget, with the cost of caring for an aging population having climbed and an economic slump having squeezed tax revenue.

Deficit spending surged in the 1990s as the government poured cash into successive public works projects to boost the economy after the collapse of a real estate and stock market bubble. Prime Minister Junichiro Koizumi capped spending of this kind when he took office in 2001, arguing it was doing little to spur continued growth.

Still, the government plans to rely on bond issues to cover 44.6 percent of its budget for the current year through March 2005.

The Finance Ministry forecasts that fresh bond issues will total 36.6 trillion yen during the year, little changed from 36.45 trillion yen in the previous term. Analyst say, however, that Japan can hope for a boost in tax revenue this year due to an economic rebound powered by surging exports to China, among others.

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