Japan Passes Emergency Budget

BBC News reports:

The Japanese government has announced a 4 trillion yen ($48.9bn; £29.6bn) emergency budget for disaster relief, after March's earthquake and tsunami.

The budget still needs approval from parliament later this month, and could be implemented in May.

Authorities say no new bonds were issued to fund the spending, to prevent adding to Japan's huge public debt.

The government estimates it will cost as much as 25tn yen to rebuild the country.

The emergency budget is aimed at disaster relief, including providing temporary housing, restoration of infrastructure and disaster-related loans.

The 11 March earthquake left more than 27,000 people dead or missing.

It also destroyed infrastructure in the north-eastern part of Japan and triggered a nuclear disaster.

Prime Minister Naoto Kan has said this could be the first of several extra budgets needed to fund reconstruction.

On Thursday, his government made it illegal to enter a 20km (12-mile) evacuation zone around the stricken Fukushima nuclear reactor.

Cooling systems were knocked out by the twin disasters and radiation has been leaking from the plant.

It is not clear how many people are still living in the evacuation zone, but reports said police had counted at least 60 families.

Debt worries

The budget will be financed by taking 2.5tn yen from pension funds, as well as money set aside to increase payments to families with children.

Money from emergency reserves is also being used.

But the government has promised that it will not sell more bonds, or borrow more money from the markets, to fund this spending.

Japan already has a debt burden double the size of the economy.

However, some analysts warn that the government will have to increase debt issuances in the future to finance reconstruction.

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