Japan approved Thursday a 1.8 trillion yen (US$18 billion) extra budget to partially finance an economic stimulus package designed to help small businesses and consumers cope with the impact of fuel and commodity price hikes.
The upper house of parliament approved the additional budget for the current fiscal year through March 2009, primarily to help fishermen and farmers who had been hit by soaring fuel prices earlier this year and to support small businesses and consumers.
The more powerful lower house had approved the budget earlier this month.
The extra budget is part of an 11.7 trillion yen (US$117 billion) emergency stimulus package drafted in August, before the global financial turmoil worsened in September following the bankruptcy of U.S. investment bank Lehman Brothers Holdings Inc. and recent global stock declines.
With the fallout of the U.S. financial crisis and Japan's economy mired in the doldrums, Prime Minister Taro Aso said he would consider additional measures to bolster the economy, because the global financial conditions have largely changed since the package was drafted.
"The situation is critical," Aso said. "We must act quickly."
Aso later Thursday instructed Cabinet ministers and other top officials to compile additional measures by the end of October that would alleviate possible damage to consumers' daily lives, small businesses and the local economy, as well as the country's financial system.
"In order to cope with the current crisis, further steps would be needed," Aso told the upper house budget committee earlier Thursday. "However, I still believe the package would be effective to a certain degree."
Japan's key stock index plunged 1,089.02 points, or 11.4 percent, to close at 8,458.45 on Thursday _ its biggest drop since 1987 _ amid global recession fears.
