The government’s fiscal plan to be released by June may include a numerical goal for reducing the ratio of debt to gross domestic product, national strategy minister Yoshito Sengoku said.

“We need to consider steadily reducing the accumulated long-term public debt relative to GDP once the economy returns to cruising speed,” Sengoku, 64, said in a recent interview. “We need to show some sort of numerical target” in the midterm fiscal framework, he said.

Japan’s debt has come under more scrutiny since Standard & Poor’s cut its outlook on the country’s AA sovereign rating in January, a move Sengoku described at the time as a “wakeup call” to repair the nation’s finances.

The country’s debt-to-GDP ratio is approaching 200 percent, the highest in the Organization for Economic Cooperation and Development.

Sengoku said the government needs to “carefully determine” when to implement the fiscal target. The plan should have “some flexibility,” such as by providing scope for regular revisions, he added.

Finance Minister Naoto Kan said this month that it’s too early to withdraw fiscal stimulus because the economic recovery remains fragile. He is working with Sengoku on the fiscal strategy, which is scheduled to be released before the July Upper House election.

Investors “are looking at how the government of the day thinks about fiscal discipline,” said Sengoku, who replaced Kan as national strategy minister in January.

Global scrutiny of sovereign debt has risen as fiscal deficits in Greece and other countries swell in the wake of the worldwide financial crisis.

Prime Minister Yukio Hatoyama’s six-month-old administration has proposed a record budget of ¥92.3 trillion for the year starting April 1 as it seeks to sustain the recovery.

S&P said the ruling Democratic Party of Japan’s policies “point to a slower pace of fiscal consolidation” than it had previously expected. Moody’s Investors Service says the nation needs a credible fiscal strategy to reduce deficits and debt.

Still, Sengoku said, “the risk of a surge in yields is small at the moment,” partly because the nation continues to post a current-account surplus.

Sengoku, who joined the DPJ in 1996, said Japan has “extremely little” room for further stimulus spending because of the country’s financial condition.

His remarks contrast with comments made last week by financial services minister Shizuka Kamei, leader of a junior coalition party, who urged the government to compile another stimulus plan to spur the deflation-plagued economy.

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