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To: Alex who wrote (22869)	11/12/1998 2:38:00 AM
From: Sergio R. Mejia	Respond to of 116762

Rescue plan for Japan's economy: The package is worth more than $115bn The Japanese Government has unveiled plans for the country's biggest ever stimulus package aimed at trying to haul the world's second largest economy out of recession. The plan involves slashing taxes and providing a huge boost to public spending. Prime Minister Keizo Obuchi has promised since August to act speedily to end Japan's worst recession ever. On Thursday his governing Liberal Democratic Party (LDP) outlined the measures they hope will do the trick. A recovery in the Japanese economy is seen as vital to avert a global economic recession. Spending its way out of trouble The total economic package is worth ¥18 trillion ($148bn), making this the largest stimulus package Japan has ever seen. Central to the plan is ¥10 trillion ($82bn) for new public works projects and ¥4 trillion ($33bn) in income tax cuts. Corporate taxes will also be cut sharply. Back on track Japan's economy is expected to shrink this year and unemployment will rise beyond its already record levels but the LDP believes this package will put the economy back on track within two years. The announcement of the details has been carefully timed. A strong Japanese economy is seen as essential if other countries in the region are also to recover. How Japan plans to turn the economy around will be one of the main discussions at the Asia Pacific Economic Co-operation Forum taking place in Malaysia. The Japanese Prime Minister will meet his Asian counterparts and President Clinton there and may face tough questioning on the economy. One part of the plan has already met with widespread criticism in Japan. Shopping vouchers The government's most innovative idea is to give shopping coupons to 35 million citizens in the hope that it will spark a consumer boom. The elderly and families with young children will be given vouchers worth ¥700m ($5.8bn). But economists say the coupons will not increase spending as households will simply use them to buy everyday items and save their own cash. The scheme has sparked widespread criticism of the LDP, with many saying it proves that politicians have no idea how to revive the economy. Analysts remained unimpressed by the measures and Japanese stocks closed down 2% amid fear that the plan does not go far enough. More details of the stimulus package will be announced on Monday.