Official announcements from Japan's Ministry of Finance or government budget reports

Japan Approves Record 115.54 Trillion Yen Budget for 2025, Defense Spending Hits 8.7 Trillion Yen

Dec 29, 2024, 05:30 PM

Japan's government has approved a record 115.54 trillion yen (about 733 billion USD) draft budget for fiscal 2025, marking the third consecutive year the general-account budget has exceeded 110 trillion yen. The budget includes a significant increase in defense spending, set to reach a record 8.7 trillion yen, a 9.4% increase from the previous year, as Japan aims to enhance its counterattack capabilities amidst rising regional tensions. The draft budget also allocates a record 38.28 trillion yen for social security, reflecting the pressures of an aging population and declining birthrate. Despite robust corporate earnings boosting tax revenues to a projected 78.44 trillion yen, the government plans to issue 28.65 trillion yen in new bonds to finance the budget. However, Japan's defense spending goals are being challenged by inflation, a weak yen, and political uncertainty, complicating its pursuit of the largest military buildup in postwar history.