Japan unveils $1.11 trillion draft budget

The Japanese cabinet last week end approved a record ¥92.4 trillion ($1.11 trillion) draft budget for the fiscal 2011-2012, which is aimed at spurring the country's economic growth amid concerns of continuing deflation, a strong yen, and high national debt.

The budget needs the final approval of the Japanese parliament (Diet) before 31 March 2010. It is expected that prime minister Naoto Kan's ruling democratic party of Japan, which has a majority in the more powerful lower house will get it passed, despite a possible opposition in the upper house.

The new budget beginning April, focuses on education for new job seekers and innovation in green technology, and expects to lift up the job market.

''We have drawn up a budget, well considering boosting economic growth and employment as well as fiscal discipline." Japan's finance minister Yoshihiko Noda told reporters after the cabinet meeting.

About ¥51 trillion will be spent on debt-servicing and providing social security, while local authorities will get nearly ¥17 trillion. The balance ¥24 trillion is earmarked for education, green technology, defence, and public works projects.

The budget plans to raise over ¥44 trillion by issuing new government bonds, while the tax revenues are estimated to be around ¥40.9 trillion, the second year in a row when bonds have crossed the tax income. The balance will be raised from special reserves.