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Japan's cabinet on Tuesday approved a huge economic stimulus package worth 274 billion dollars including more than 80 billion dollars in direct spending, the government said.
The package is meant to boost a fragile recovery from Japan's worst post-war recession, which is now threatened by deflation and the strong yen's impact on exporting companies in Asia's biggest economy.
The cabinet of centre-left Prime Minister Yukio Hatoyama agreed on the size of the package, to be financed by an extra budget for the financial year to March 2010, after its announcement was delayed last Friday.
"We made a cabinet decision on the emergency economic measures," chief government spokesman Hirofumi Hirano said. "The scale exceeds 24 trillion yen in terms of the value of projects."
The new package totals 24.4 trillion yen (274 billion dollars), the government said in a statement.
It includes direct spending as well as loan guarantees and other measures that do not require actual government outlays.
It would extend a reward programme for energy-efficient appliances and loan guarantees for small and mid-size businesses, and include spending to help companies retain workers, reports have said.
The Hatoyama government, which ousted the long-ruling conservative party in a landslide election in August, froze part of its predecessor's first supplementary budget, which was worth 13.9 trillion yen.
It cited the need to slash government waste in Japan, where public debt is around 180 percent of gross domestic product, largely due to massive spending during the economic "lost decade" of the 1990s.
Japan's economy grew 4.8 percent on an annualised basis in the July-September quarter, the fastest growth in two and a half years, according to preliminary data from the finance ministry released last month.
The stimulus package was held up Friday when the financial services minister, Shizuka Kamei, boycotted a ministerial meeting while demanding additional spending, part of which was agreed by the cabinet.
Hatoyama's Democratic Party of Japan needs the support of Kamei's smaller People's New Party to ensure passage of laws in the upper house.
