• Reuters

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The government plans to keep setting aside money to promote domestic tourism and dining out in its next stimulus package, according to a draft of the upcoming package seen by Reuters, even as rising COVID-19 infections have prompted concern about the campaigns.

The draft stimulus package also included a plan to set up a fund to encourage investment in green technology, a nod to Prime Minister Yoshihide Suga’s pledge that Japan will aim for net-zero emissions by 2050.

The outline underscores Suga’s resolve to keep businesses open, even as Japan faces a resurgence in coronavirus infections, which is quickly filling up hospital beds. It also points to the dilemma policymakers face in balancing the need to support the economy without spreading the virus.

The draft made no mention of the size of stimulus package or its source of funding, which will likely be finalized in the coming days.

Some ruling party lawmakers have called for a third extra budget of up to ¥30 trillion ($290 billion) to fund the new package, which Suga instructed his cabinet to compile.

The stimulus plan would follow two previous packages rolled out this year to cushion the economic blow from the pandemic.

While the previous packages responded to the immediate hit from the pandemic, the upcoming stimulus is seen focusing more on efforts to cope with the “new normal” in the post-COVID-19 era.

The new package will include subsidies for municipal governments that compensate businesses meeting requests to close shops early to contain the pandemic, the draft showed.

The government will also aid research and development in programs that help achieve a carbon neutral society, according to the draft.

Japan has confirmed around 150,000 cases of virus infections, with deaths at more than 2,100.

The economy has been gradually recovering from its worst postwar slump, caused by the coronavirus, earlier this year. But it is likely to take years before the economy returns to pre-pandemic levels.

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