TOKYO: Japan plans to issue less than 38 trillion yen ($317.9 billion) in new bonds in the next fiscal year starting April, cutting fresh issuance by more than 3 trillion yen from the 41.3 trillion yen worth of debt it issued this fiscal year.
Prime Minister Shinzo Abe has vowed to stick to the country’s long term goal to balance the budget excluding debt services by 2020/21 but many analysts doubt whether that would be possible after Abe delayed the second leg of a planned sales tax hike by 18 months to 2017.
The cut in debt would be made possible by rises in tax revenues following a sales tax hike early this year.
This would mark the third year in a row when the Japan’s government reduces its reliance on borrowing to finance its budget, as it struggles with a debt level that is more than double the size of the economy, or the industrial’s world’s highest.
The government’s total spending is expected to top 96 trillion yen for the first time next fiscal year, as spending on social security and defence show expected increases.
