Question

please explain economic policies in response to the outbreak of Covid-19 in Japan. explain as many and as clearly as possible. What is done by the country to maintain its economy?

Answer 1

Japan is one of the developed countries which is hit by COVID-19 and now it is one of the least-affected among other developed countries.

The economic policies in response to the outbreak of Covid-19 are:

FISCAL:

a)As a response to the outbreak of Covid-19, on April 7, the Government of Japan adopted the Emergency Economic Package against COVID-19 of ¥108.2 trillion ( which is 20 percent of GDP) and it also included the remaining part of the December 2019 stimulus package, and the two COVID-19-response packages announced on February 13 and March 10 respectively.

b) In order to combat Covid-19, Japan provides additional US$100 million contribution to the IMF, which supports the Fund’s capacity to provide grant-based debt service relief for the most vulnerable countries.

MONETARY AND MACRO - FINANCIAL:

c) The Japan's government expanded the volume of concessional loan facilities mainly for micro, small and medium-sized business which are affected by COVID-19 through the Japan Finance Corporation and other institutions.

d) The Bank of Japan (BoJ) in a monetary policy meeting, has provided lending support through the special funds-supplying operation, and made purchases of Japanese government securities, corporate bonds, commercial paper, and exchange-traded funds.

EXCHANGE RATE:

e) The exchange rate of Japan has been allowed to adjust flexibly.

In order to maintain its economy, the authorities of Japan have been taking several measures targeted towards the economic policies.