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Japan Formulates Strategy to Tackle Gas Price Increase

The Japanese government is planning to implement more strategies by the end of August to address the steep surge in gasoline and other fuel costs.

Prime Minister Fumio Kishida directed Liberal Democratic Party’s (LDP) Policy Research Council Chairman Koichi Hagiuda to formulate the measures during a meeting at the Prime Minister’s Office in Tokyo.

Kishida is also arranging for a significant stimulus package to be developed next month.

The package will encompass assistance for industries experiencing growth and actions aimed to mitigate the impact of elevated prices.

“We will make sure that the public is able to feel the effects of the measures in early September,” the Prime Minister told reporters after the meeting.

The government will consider measures to keep gasoline prices low, including the continuation of subsidies currently given to oil wholesaler after October.

The subsidies to oil wholesalers are set to expire at September end. With oil prices having temporarily calmed, the government has begun to reduce subsidies. However, the national average price of regular gasoline rose to JPY181.9 per litre as of August 14, the highest level in 15 years since August 2008, due mainly to production cuts in oil-producing countries and the weakening of the yen in the foreign exchange market.

Some LDP members have proposed application of the currently frozen trigger clause, a provision allowing for a temporary gasoline tax reduction when prices soar to a certain level.

“While taking into account the situation of various prices, I would like to come up with economic measures in September,” Kishida told the reporters.

In addition to supporting growing industries such as semiconductors and encouraging companies to raise wages, the government also plans to study the possibility of continuing to subsidise electricity and city gas after October, according to a senior government official.

The government is preparing to submit a draft supplementary budget for fiscal 2023 to an extraordinary Diet session, expected to convene in October.

Source : Borneo Bulletin