TOKYO (AP) – Japan’s parliament on Tuesday approved an additional 2.7 trillion yen ($21 billion) budget to deal with soaring fuel and food prices following Russia’s invasion of Ukraine.
The additional budget is for the current fiscal year, which began April 1, and will fund part of a 6.2 trillion yen ($48 billion) economic emergency package that Prime Minister Fumio Kishida’s government passed in late April and which includes subsidies for oil wholesalers to minimize the impact on consumers.
Almost 1.2 trillion yen ($9.4 billion) will be used to extend the current oil subsidy program through the end of September.
Crude oil prices have risen sharply on fears of supply disruptions from Russia due to its invasion of Ukraine. Wheat and corn prices have also risen significantly, causing food prices to skyrocket.
The extra budget will be funded by new government bond issues, adding additional strain to the world’s third largest economy, which is already in the worst fiscal position among major economies.
Japan has an initial budget totaling 107.6 trillion yen ($840 billion) for the current fiscal year.
