Japan Mulls Extending Fuel Subsidies amid Political Backlash

Japan’s government and ruling party officials are considering extending fuel subsidies beyond May, sources told Reuters on Friday, as a feeble economy and political pressure drive more fiscal spending.
The economy unexpectedly slipped into a recession at the end of last year and lost its title as the world’s third-biggest to Germany, data showed on Thursday, underscoring the weakness of private consumption amid steady inflation.
The government began subsidising energy wholesalers to curb domestic prices of gasoline, kerosene and other fuels in January 2022 and has extended them multiple times as part of its fiscal packages to address rising living costs. Lawmakers at the ruling Liberal Democratic Party (LDP) and its coalition partner Komeito are calling for the subsidies to be extended further amid a political backlash against Prime Minister Fumio Kishida’s administration over a funding scandal, multiple party and government sources familiar with the matter said.

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