Japan mulling target to limit fiscal deficit to 3 pct of GDP
Jiji -- May 12
The Japanese government is considering setting a new target to reduce its fiscal deficit to 3 pct of nominal gross domestic product by fiscal 2021, informed sources said Friday.

The government hopes to include the target in its new guidelines for economic and fiscal policy management due out as early as June, as it sees the possibility that its interest payments on existing bonds may shoot up.

The European Union has a similar target for its members. In Japan, such a target has been proposed at the government's Council on Economic and Fiscal Policy, which drafts the policy guidelines.

Japan's fiscal deficit is forecast to stand at 4.4 pct of nominal GDP in fiscal 2018, according to medium- to long-term economic and fiscal estimates submitted by the Cabinet Office in January this year.

The government agency projects that the percentage will stabilize below 3 pct from the early 2020s due to low interest rates and an expected rise in tax revenues following a planned October 2019 consumption tax hike.

News source: Jiji
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