Dec. 4 (Bloomberg) -- The Japanese government may delay an economic stimulus package after members of Prime Minister Yukio Hatoyama’s coalition said the proposed plan was insufficient.
“It probably won’t come together” today, Mikio Shimoji, head of policy research at the People’s New Party, told reporters in Tokyo. The head of the Social Democratic Party, also a minority coalition member, said the government was still debating the plan.
PNP leader and Financial Services Minister Shizuka Kamei has urged for spending of at least 8 trillion yen ($90 billion). Hatoyama’s Democratic Party of Japan had planned a package of as much as 4 trillion yen, Finance Ministry officials familiar with the matter have said.
Kamei “won’t relent on the 8 trillion yen figure,” Shimoji said, adding “We’ve put negotiations on hold.” He said signs the economic expansion has been weakening mean the government will need to spend more than planned.
“We’re in deflation, so we need something quantitative,” Shimoji said. “We think that unless it’s around 8 trillion yen, the economy won’t respond. They have no choice but to bow down,” he added, referring to the DPJ.
“I think there’s a possibility it won’t happen today,” SDP leader Mizuho Fukushima told reporters at the Prime Minister’s residence in Tokyo.
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