The government has announced an ¥11.7 trillion economic stimulus package to prevent a further slide of the Japanese economy. It represents a short-term approach to tide over current difficulties. Apparently the ruling coalition of the Liberal Democratic Party and Komeito hoped the package would help them in a future Lower House election. But it will not necessarily help improve the long-term strength of the Japanese economy. The resignation of Prime Minister Yasuo Fukuda may also cause confusion in the implementation of the package.
Of the ¥11.7 trillion, ¥9.1 trillion is aimed at assisting small and medium-size enterprises affected by high prices for oil and other resources. The package includes government-backed credit guarantee programs for these enterprises as well as the expansion of loans by government financial institutions.
Other measures include a 50 percent cut in late-night expressway fares at electronic toll-collection points to help the trucking industry, promotion of solar power generation, price-rise restrictions on imported wheat, and effective use of farmland to reduce dependence on food imports.