Japan to Inject 900 Billion Yen to Counter Trump's Tariffs

【Tokyo=Kim Kyungmin Correspondent】 The Japanese government is preparing an emergency package to respond to the tariff measures of the Donald Trump U.S. administration, and will embark on fiscal spending totaling 900 billion yen (approximately 8 trillion 641.7 billion won). Of this, 380 billion yen will be covered by reserves, focusing on subsidies for electricity and gas bills, corporate funding support, and stimulating consumption. The total project size, including local government and private funds, is expected to reach about 2 trillion 800 billion yen.
The Japanese government plans to make a cabinet (state council) decision on the 27th to include reserve spending, and will inject about 280 billion yen solely into the core project of electricity and gas bill subsidies. In August, when power consumption surges, subsidies of 2.4 yen per kWh will be provided, and 2.0 yen in July and September. As a result, ordinary households are expected to reduce their burden by around 1,000 yen per month based on the combined electricity and gas bill.
This measure is significant as it marks the first fiscal injection decision in response to U.S. tariff measures. The government plans to prepare additional support measures in the future and secure resources by organizing a supplementary budget for fiscal year 2025 at the autumn extraordinary Diet session.
In addition, the government will carry out fiscal spending of about 300 billion yen to alleviate corporate funding difficulties and reduce import-export risks. It plans to strengthen financial support by utilizing the loan system of the Japan Finance Corporation and providing insurance through Nippon Export and Investment Insurance.
In the focus support local allocation tax grant, which allows local governments to promote projects to respond to price increases according to local circumstances, 100 billion yen will be allocated from reserves. Separately, the government plans to enhance regional price response capabilities through fiscal spending totaling 300 billion yen.

km@fnnews.com Kim Kyungmin Reporter