October 15, 2021: -On Thursday, Japan must compile an economic stimulus package worth nearly 32-33 trillion yen to cushion the impact of the coronavirus pandemic, a senior ruling party official close to Prime Minister Fumio Kishida said.

Large-scale spending would be needed to fill the output gap and achieve the central bank’s 2% inflation target of Japan, said Kozo Yamamoto, an architect of former premier Shinzo Abe’s “Abenomics” stimulus policies.

“The package can be funded by issuing Japanese government bonds,” said Yamamoto, now Kishida’s associate on economic policy. “The government should issue a massive amount of long-term JGBs, which can be purchased aggressively by the central bank.”

A former finance ministry official, Yamamoto, creates Abenomics, a mix of massive monetary and fiscal stimulus and a growth strategy deployed in 2013 to pull Japan out of economic stagnation.

Kishida has said he will sustain the stimulus policies of Abenomics and take additional measures to distribute the wealth more broadly to households.

“What’s important first and foremost is to achieve strong economic growth with the three arrows of Abenomics. Only then can we talk about redistribution,” said Yamamoto, who added that he exchanges emails frequently with Kishida.