Page last updated at 10:35 GMT, Thursday, 30 October 2008

Japan unveils new stimulus plan

Taro Aso
Taro Aso took over as prime minister from Yasuo Fukuda last month

Japanese Prime Minister Taro Aso has unveiled Japan's second economic stimulus package in as many months.

The 5 trillion yen ($51bn; 31bn) package includes cutting highway tolls and increasing loan guarantees that have been offered to small companies.

There will also be a package of tax cuts and other benefits for Japan's struggling households.

It comes on top of the 11.7 trillion yen package unveiled in August by Mr Aso's predecessor, Yasuo Fukuda.

The new package also includes an expansion of tax-exempt housing loans to boost the struggling property market, funding for care of children and the elderly, and support for unemployed young people.

"In this kind of situation, we need to relieve people's insecurities," Mr Aso said.

"We should not be fearful of the violent storm, nor should we just stand and let the typhoon blow us away."

Election delay

But the prime minister also said that if economic conditions allowed, he would like to be able to raise consumption taxes in three years.

Mr Aso said he would wait to call elections until his economic measures had taken effect.

"I would like to ask for people's approval after seeing the achievements of my policies," he said.

The election must take place before September 2009. Before the financial crisis worsened, there had been speculation about a possible snap election in November.

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