Japan Ready to Help Firms:

https://www.yahoo.com/finance/news/exclusive-japan-boost-special-financing-094116780.html

Article:

TOKYO (Reuters) - Japan will boost its special financing for small and mid-size firms hit by the coronavirus to 1.6 trillion yen ($15.6 billion), according to a government document seen by Reuters on Monday.

The financing, which the government is due to announce on Tuesday, marks a sharp increase from the roughly 500 billion yen previously announced.

The government will use public financial institutions including the Japan Finance Corporation [JFC.UL] and the Development Bank of Japan [DBJPN.UL] to provide the funding, according to the document.

Comments and Ideas:

Its good that that small and medium sized businesses will get some help. But the main problem seems to be red-tape or time it takes to get the needed assistance. Some companies maybe can't wait a month or even two as they need the assistance now. And most likely if the situation continues the government is going to need to provide a few more special financing measures over the next six months or a year. And then worry about how to manage all the government debt later.

Article.

The move comes as the widening coronavirus outbreak has shaken the Japanese economy, which was already on the brink of recession. Finance Minister Taro Aso last week urged public and private financial institutions to step up efforts to ensure smooth corporate financing.

The world's third-largest economy shrank by an annualised 7.1% in the three months through December, worse than originally thought and the steepest decline since 2014, revised data showed on Monday.

The number of coronavirus cases in Japan has surpassed 1,100, including those from a cruise ship, and claimed 16 lives just as the nation prepares to host the summer Olympic Games in July and August.

Comments and Ideas;

The key phrase here is "smooth corporate financing." Meaning the companies that are in need should not have to wait for very long to get the corporate financing they need. And they should not have to fill out pages and pages of forms. It should be a simplified process and as quick as possible. 

Of course a lot has happened since this article was written. But at this time the need was there. And now in April, when the comments are being made, the situation is much more than expected. So now the need for more corporate financial assistance is even greater.

Article:

As part of the measures, some 500 billion yen will be earmarked for smaller companies, including those whose sales have been hit by the outbreak. That is on top of the 500 billion previously announced.

Other measures include around 200 billion yen of financing from the Development Bank of Japan and the Shoko Chukin Bank [SKCBK.UL] for companies, including larger ones, as a crisis response, according to the document.

Reuters previously reported that the Bank of Japan may take steps this month to ensure that companies hit by the coronavirus outbreak do not face a financial squeeze before the end of the current fiscal year in March.

Comments:

Lets hope the Japanese government can do even more. It might take over a year for the businesses to get back to normal. The government needs to be sure it can do what it can, and more, to protect jobs and businesses and get things either back to normal as soon as possible or at the very least minimize the damages that are taking place now.

Have a nice day and be safe out there!

© 2020, Tom Metts, all rights reserved