Japan’s Parliament passed a record 92.3 trillion yen ($1 trillion) budget on Wednesday, seeking to underpin a fragile recovery in the world’s number two economy. It was the first budget for Prime Minister Yukio Hatoyama, who came to power in September 2009 after a historic electoral victory.
The record budget reflected Hatoyama’s promise to cut wasteful spending on public works and boost funding for social welfare.
The budget raised concern over Japan’s already tattered finances as the government will issue a record 44 trillion yen in bonds to fund the budget.
Japan shoulders the biggest public debt among industrialised nations. Its debt stood at 218.6 per cent of GDP (gross domestic product) in 2009, according to the International Monetary Fund.