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Japan OKs FY 2024 budget, defense spending reaches new high

TOKYO | Xinhua | The Japanese government on Friday adopted a draft budget of 112.07 trillion yen (about 787 billion U.S. dollars) for fiscal year 2024, with defense spending hitting an all-time high for the 10th straight year.

The figure approved by the cabinet for the fiscal period from April 2024 to March 2025 marked the first drop in 12 years amid shrinking emergency funding related to COVID-19.

The budget, although smaller than the record 114.38 trillion yen allocated for the current business year to March, is still the second-largest, underscoring the urgency for debt-ridden Japan to rein in spending and restore its fiscal health, national news agency Kyodo reported on Friday.

Specifically, the defense budget amounted to a record high of 7.95 trillion yen, a 16.5-percent jump over the initial budget for fiscal 2023.

Of the total, 1,247.7 billion yen will be allotted to missile defense equipment and 734 billion yen for long-range missiles, including those for the country’s counterstrike capabilities, according to local media.

Japanese Prime Minister Fumio Kishida last year pledged to raise national defense spending to a total of 43 trillion yen over the next five years, bringing the annual budget to 2 percent of gross domestic product in fiscal 2027.

In another controversial move on Friday, the Japanese government relaxed its ban on exports of arms and ammunition manufactured under license from foreign companies to their countries, and conditionally to third countries under the revised Three Principles on Transfer of Defense Equipment and Technology and the Implementation Guidelines.

The draft budget also saw outlays of social security and debt servicing swelling to record highs, with about a third of the state budget, or 37.72 trillion yen, earmarked for social security costs for Japan as one of the world’s fastest-graying countries. (1 U.S. dollar equals 142.06 Japanese yen)

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