Japan to Compile 2nd Extra Budget to Cushion Economic Blow as Battle against Covid-19 Continues: Report

Japan will compile a second supplementary budget for the current fiscal year to fund new measures to combat the economic fallout from the coronavirus pandemic, the Nikkei newspaper reported on Monday.

The package would aim to cushion the blow to the world's third-largest economy, which is on the cusp of deep recession amid a plunge in global demand and a local state of emergency that has been extended through to the end of May.

The new measures will include aid to companies struggling to pay rent, support for students who have lost part-time jobs, and more subsidies to companies hit by slumping sales, the paper said.

The government plans to pass the supplementary budget through the current parliamentary session that runs through June 17, the paper said, without citing sources.

Japan compiled a record $1.1 trillion economic stimulus package in April that focused on cash payouts to households and loans to small businesses hurt by the pandemic.

Ruling coalition lawmakers have ramped up calls for more assistance, as the government's decision to extend a state of emergency heightens risks of more bankruptcies and job losses.

Japan's economy likely shrank for a second straight quarter in the first three months of this year, a Reuters poll showed, meeting the technical definition of a recession as the pandemic crushed consumption and business activity.