Kan to Solicit Views on Stimulus from Biz, Labor Circles

Tokyo, Aug. 23 (Jiji Press)--Japanese Prime Minister Naoto Kan said
Monday he will solicit opinions from the business and labor circles as well
as the ruling coalition about additional stimulus measures.
Kan will hold talks as early as this week with officials from such
lobbies as the Japan Business Federation, or Nippon Keidanren, and the
Japanese Trade Union Confederation, the country's biggest labor union group
known as Rengo.
Kan also plans to meet with Shizuka Kamei, head of the People's New
Party, the ruling Democratic Party of Japan's junior coalition partner,
which calls for massive fiscal spending worth over 11 trillion yen to
stimulate the flagging economy.
The DPJ, for its part, plans to compile a set of its own proposals
as early as Thursday. Koichiro Genba, chairman of the party's Policy
Research Committee, has left open the possibility that the government will
sell more bonds to finance stimulus measures.
Kan plans to draw up additional stimulus measures early next month
to help the country address the yen's rise and a slowing economy.
On Monday, Kan held phone talks with Bank of Japan Governor Masaaki
Shirakawa, while being briefed by Finance Minister Yoshihiko Noda on recent
economic developments including foreign exchange rates.
Noda told reporters after the meeting that Kan instructed him to
closely watch financial market movements.
Noda said that he and Kan did not discuss the size of additional
stimulus measures.
The measures are expected to include employment support for young
people, incentives for consumer spending, financial assistance to small
firms and deregulation, sources familiar with the matter said.
A government task force led by Manabu Terada, a special adviser to
the prime minister, will hold an inaugural meeting Tuesday to discuss ways
to help high school and university graduates find jobs.
Potential measures will include boosting subsidies to companies
which hire new graduates on an experimental basis.
Measures to fuel consumer spending may include extending eco-point
programs aimed at promoting purchases of energy-saving homes and electric
appliances, set to expire at the end of this year.
The government is considering spending 1.7 trillion yen on stimulus
measures by tapping into 920 billion yen in unused reserve funds set aside
under this fiscal year's budget for coping with an economic crisis and some
800 billion yen out of the net budget surplus left in the previous year.
But PNP Secretary-General Mikio Shimoji said that less than 2
trillion yen would not be enough for the economy to regain momentum, urging
the government to introduce massive fiscal spending including public works.
Meanwhile, the Finance Ministry is negative about additional bond
issuance on top of a record 44.3 trillion yen planned for the current fiscal
year ending in March 2011.
Instead, the ministry wants the BOJ to introduce additional
monetary easing measures to underpin the economy and stem the yen's rise.
Massive spending should not come without a tax reform overhaul aimed at
boosting government revenue, a senior ministry official said.