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Japanese Government`s Record Budget of Yen 102.8 Trillion for Next Year

Japanese Government`s Record Budget of Yen 102.8 Trillion for Next Year (article)

According to the Japanese Finance Ministry, the overall general-account budget requests by government ministries and agencies for fiscal 2019 totals a record high of over Yen 102 trillion. The actual total of budget requests are likely to increase as the government aims to take negative pressure off of the economy that is expected by the consumption tax hike. This issue is still under consideration.

In an effort to maintain fiscal discipline, the ministry is eyeing tougher scrutiny of budget requests. The 2016 budget of Yen 102.4 trillion was posted but eventually was curbed to Yen 96.7 trillion yen. There is a good chance that the 2019 budget will top Yen 100 trillion for the first time. Some highlights are as such – the Health, Labor and Welfare Ministry requested Yen 31.9 trillion, as the aging population ushers in increases in social security expenditures.

The Defense Ministry has requested Yen 5.3 trillion which is contributed to the recent challenges Japan faces from the North Korean missile threat. The two said ministries have record high requests, pushing up the total budget above the 100 trillion yen mark. There is also a component that requests for funds to cope with the frequently occurring natural disasters. This is interesting as 2018 has been overwhelmed with natural disasters.

It is important to note that the US and Japan have been working closely on developing military defense systems that are clearly focused on research and development of hardware. Japan an the US are cooperating in several projects that seem to be aimed at defending free trade and keeping sea lanes open while China expands by gobbling up islands in the South China Sea. This may help explain the increase in Japanese spending on military outlays.

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