Connect with us

Hi, what are you looking for?


Japan to consider tapping FX account to boost defense spending – Kyodo

TOKYO – Japan‘s government is considering tapping funds under an account set aside for foreign exchange intervention to pay for an expected increase in defense spending, Kyodo news agency reported on Tuesday.

The government could also issue additional bonds until a decision is made on whether to raise taxes as a long-term source of funding for the scheduled spending increase, Kyodo said without citing sources.

Prime Minister Fumio Kishida instructed his ministers on Monday to work on a plan to lift defense spending‘s share of gross domestic product to 2% within five years, from about 1% now, which would strain Japan‘s already tattered finances. The increase amounts to roughly 11 trillion yen ($79.42 billion).

The defense ministry and the fiscal hawks of the finance ministry have been at odds as to how much the government should spend to bolster Japan‘s defense capabilities.

A senior government official declined to comment on the media report. The special account that manages foreign reserves has been tapped the past to fill shortfalls in the general account budget. The fund reaps 2 trillion to 3.5 trillion yen ($14 billion-$25 billion) in retained earnings annually, Kyodo reported.

The proposal highlighted the government’s struggle to scrape together defense funding while dealing with the industrial world’s heaviest debt burden – more than twice the size of Japan‘s economy.

The Ministry of Finance has been wary of tapping the surplus funds, as they are held in case intervention is needed in the foreign exchange market.

Opposition from within the ruling bloc against tax increases has clouded the prospects for more defense spending, leaving more debt issuance and cuts in other spending as the two other leading options.

Lawmakers at an LDP tax panel meeting on Monday suggested tax breaks including capital gains, a Nippon Individual Savings Account (NISA) tax-free investment scheme to corporate research and investment, start-up businesses, inheritance and gifts.

Yoichi Miyazawa, head of the LDP tax commission, told reporters on Monday that he was ready to debate tax increases to fund more defense outlay, but that such talks should wait until the government comes up with estimates on funding sources. – Reuters

Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!



Egg vendors arrange their products for sale at a store along Blumentritt in Manila, Jan. 26. Filipinos are grappling with soaring prices of food,...


ICC prosecutor authorized to reopen Philippines drug war investigation – BusinessWorld Online ...


At Christmastime, monster waves and winds battered the 23-year-old Tubbataha Ranger Station. (Inset photo) Metro Pacific Investments Foundation, Inc. committed to provide an additional...

Editor’s Pick

<?xml encoding=”utf-8″ ??> Have you ever wondered how long it would take a CEO to make the UK’s average yearly salary? High Pay Day...


PHILIPPINE STAR/ MICHAEL VARCAS By Luisa Maria Jacinta C. Jocson, Reporter THE PHILIPPINES weathered record inflation and interest rate increases last year by posting...


PHILIPPINE STAR/ MIGUEL DE GUZMAN PHILIPPINE DEMAND for oil would probably grow at an average 3.4% between 2022 and 2031, according to Fitch Solutions...

You May Also Like


COVID-19 has had a significant impact on the mental health of Filipinos across different groups all over the archipelago. From frontline workers, parents balancing...


REUTERS By Luz Wendy T. Noble, Reporter The country’s foreign exchange buffers slightly increased as of end-October as the value of the central bank’s...


BW FILE PHOTO GROSS BORROWINGS by the National Government reached P2.6 trillion as of end-September as it continued to raise funds to respond to...


KARASOLAR.COM TENA, Ecuador — Ecuador’s rainforest Achuar people say their ancestors long dreamed of a “fire canoe” or “electric fish” that would let them...

Disclaimer: Respect, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2022 Respect Investment. All Rights Reserved.