Japan's Budget Goal Is Being Deferred Again

Key fiscal target won’t be reached until the late 2020s
Achieving a primary surplus is key to addressing debt

A passenger prepares to board a train at the Ichinoseki train station in Ichinoseki, Iwate prefecture, Japan, on Sunday, Jan. 18, 2015. Japan plans a record budget for next fiscal year to support an economy that fell into recession after Prime Minister Shinzo Abe's government increased the sales tax.
Photographer: Tomohiro Ohsumi/Bloomberg

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By James Mayger, Connor Cislo, and Maiko Takahashi

January 17, 2018 at 1:30 AM UTC

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One of Japan’s key targets for addressing its ballooning debt is set to be pushed further into the future when the Cabinet Office updates economic forecasts next week.

The primary balance, which measures the government’s fiscal position excluding interest payments on its borrowings, was meant to come out of the red in fiscal 2020. Reaching the goal was seen as a first step for Prime Minister Shinzo Abe’s administration to arrest debt growth, so the country could then begin to whittle it down.