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TOKYO: Japanese Prime Minister Yukio Hatoyama said Monday he would strive to prevent a return to recession in the world's second largest economy by pushing ahead with a planned stimulus spending package.
"The economy should not enter a double-dip recession and we won't let it happen," said Hatoyama, who took office in September.
In a televised new year address, he urged parliament to swiftly pass an extra budget to finance the planned spending, aimed at supporting a fragile economic recovery after the worst downturn in decades.
Hatoyama announced in early December a stimulus package including about US$80 billion in fresh spending.
The pump-priming measures include incentives for people to buy energy-saving products, as well as financial support for smaller firms and payments to struggling companies to keep staff on their payrolls.
The ruling coalition, which dominates parliament, aims to have the budget passed by the end of January so that it can concentrate on deliberations on a record trillion-dollar budget for the next financial year starting in April.
"I want to make my utmost effort to pass it as quickly as possible," Hatoyama added.
Japan's economy returned to growth in the second quarter of 2009 after a severe year-long recession, but renewed deflation and weak domestic demand are major concerns for policymakers.
Last week Hatoyama unveiled an ambitious goal to create millions of jobs and return Asia's biggest economy to steady growth as he battles a drop in his popularity and a funding scandal.
The government was vague about exactly how he would achieve the lofty goals, saying it would come up with more concrete measures by around June.
Japan has forecast a 2.6 per cent contraction in its gross domestic product in the year to March 2010, and is on course to lose its place as the world's second largest economy to China, possibly this year.
- AFP/yb
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