Japan Election May Curtail Stimulus as Recession Looms: Economy

Prime Minister Yoshihiko Noda’s decision to call an election in December may inhibit the government’s ability to stimulate an economy that’s sliding toward its third recession in four years.

Compiling an extra budget soon will be “difficult” as lawmakers cannot debate spending with the Diet dissolved, Economy Minister Seiji Maehara said this week. Stimulus using reserve funds won’t be enough to support the economy, he said in Tokyo today. Drafting of next fiscal year’s main budget may be delayed, Finance Minister Koriki Jojima said this week.