TOKYO, Oct. 29 (UPI) -- As Japan suffers its 11th year of little or no economic growth, Japanese Prime Minister Junichiro Koizumi promised voters earlier this year that the government would stop racking up more debt.
That promise, however, seems increasingly likely to be broken as the global economy faces trying times.
On Sunday, Finance Minister Masajuro Shiokawa said that if the government does indeed issue a secondary supplementary budget for this year, it would break Koizumi's promise to cap issuing deficit government bonds at 30 trillion yen ($244.5 billion).
The government has already issued nearly 3 trillion yen ($24.5 billion) as an economic stimulus package to keep the keeping economy afloat. But many politicians and business leaders alike argue that given the current global climate and the potential for the world economy falling further south.
Shiokawa did not, however, elaborate on just how much the government could potentially exceed its self-imposed 30 trillion yen ceiling.
The finance minister is also considering tax cuts as a means of keeping the economy afloat.
On Monday, the Bank of Japan reported that the domestic economy is likely to contract this year and next, confirming private sector economists' predictions that the country will face its second recession since 1998.
The Japanese central bank predicts the economy will shrink by 0.9 to 1.2 percent in the current fiscal year ending March 2002, while it sees the gross domestic product rate of growth contracting 1.1 percent the following year. The BOJ pointed out that the slowdown of the U.S. economy, coupled with a stronger yen, which makes Japanese products less competitive overseas, as well as a decline in the stock market, has already aggravated the precarious situation.