What is fiscal policies- fiscal policy is an essential tool at the disposable of government to

influence a nation’s economic growth based on KEYNESAIN economics. It is used in

coordination with monetary policy.
* change in government spending and taxes rates
* set by government
* no specific target
* side effect on government budget or borrowing
* strong political dimensions to changing tax rates

Fiscal policies of japan- The dramatic growth of the national strength since the end of
World War II has elevated Japan's status in the international community. Today, it is no
exaggeration to say that more often than ever international political and economic issues cannot
be coped with without Japanese participation.
Economically, having recovered from devastation from the war, Japan now accounts for
about 10 percent of the world's gross national product (GNP). Its position as a major economic
power is now firmly established. Along with this change, there have come to be increasing
awareness and expectations of Japan's political role in the global community.
Meanwhile, in today's more interdependent international community, political and
economic matters including security issues, are closely inter-related on a comprehensive and
global basis. As a nation, which can secure its peace and prosperity only in the context of world
peace and prosperity, Japan should tackle its foreign policy tasks comprehensively and
coherently in such fields as security, economy, economic cooperation and cultural exchange and
expand its international responsibilities from the economic field around which Japan's role has
been centered, to cover the political area as well, making contributions in ways befitting its
national strength and conditions
The world economy, as confirmed at the Williamsburg Summit, is witnessing signs of
easing inflation and business recovery in some countries. But interest rates in the United
States still stay at high levels. Unemployment in the United States and other nations beset
with structural problems also remains high. World trade has stagnated since 1980, recording
a 6 percent year-on-year decline in 1982. Against this background protectionist moves
continue persistently. Moreover, developing countries are plagued by many difficulties, such
as the problem of accumulated debts of Latin American countries.
In these circumstances it is important for each country to make best efforts to run its
economy in a balanced manner internally as well as externally, in order to secure the non-
inflationary and sustained growth of the world economy. At the same time it is necessary to
make further efforts to prevent the proliferation of protectionism and reinforce the
international trade system under the General Agreement on Tariffs and Trade (GATT),
which is indispensable to maintain and strengthen the free trade system for the sustained
economic growth of the world. In addition, for the stabilization of the international monetary
system, broad multilateral cooperation including closer consultations should be
strengthened.
As Japan's share of the world's GNP has come to represent around 10 percent, there is a
strong expectation among countries that Japan will make greater contributions to the world
economy. At the same time, however, there is criticism of Japan abroad as has been seen in
economic frictions with its trading partners. Thus requests to Japan 'from foreign countries
reflect various aspects of sentiment, and this country must respond effectively to such
requests. In many cases, however, economic issues with other countries derived from these
requests are directly related to domestic interests and have close bearings on domestic
politics. In consequence Japan is obliged to treat these problems comprehensively.
Taking the above mentioned circumstances into consideration, it will be essential for
Japan to make further efforts to open up its market aiming at balanced growth of trade and
"an open country to the world," as well as to run its economy with policies centered on the
expansion of domestic demand.
Progress in science and technology can play a major role in the stable growth of the
world economy in the medium and long term. Foreign countries look at Japan with great
expectations init as one of the advanced nations in the field of science and technology. Japan
is therefore required to attach more importance to and further strengthen international
cooperation in this field.