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Significance
The budget is likely to be enacted by the end of the current fiscal year in March 2024. Rapidly increasing military spending reflects drastic changes in Tokyo’s defence policy. On the macroeconomic side, curbing large budget deficits remains a major policy goal.
Impacts
Sluggish economic growth, as well as stagnating household and business incomes, will remain a constraint on revenue.
Rising nominal wages at large companies and in some sectors of the economy will have a limited positive effect.
Japan will become the world’s third-largest military spender after the United States and China.
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2024
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