Heizo Takenaka, minister in charge of economic and fiscal policy, hinted Tuesday that the government will revise downward its economic growth forecast for fiscal 2001 to around minus 1 percent from the current 1.7 percent.
Asked to comment on the fact that private sector economists are projecting, on average, a 1 percent contraction for this period, Takenaka told a news conference, "I myself have an image that is not quite different from that of the private sector."
He is expected to revise the state's economic growth forecast later this month, when the government will map out a draft supplementary budget for the current fiscal year, which ends March 31, government sources said.
Takenaka also indicated that the government could draft a second extra budget during the current fiscal year to finance steps to deal with "crisis conditions" in the wake of the Sept. 11 terrorist attacks in the United States.
"The government will continue to consider how to deal with crisis conditions. I think it will be one option to consider it in two steps," he said, adding that any second extra budget plan currently remains blank.
"We should consider first how to accelerate reforms amid the critical situation."
It is unusual for an incumbent minister to stress the need for a second extra budget before the government has submitted its first extra budget plan to the Diet.
Takenaka also said the government will stick to a pledge by Prime Minister Junichiro Koizumi to impose a 30 trillion yen cap on the issuance of the government bonds for the current fiscal year.
On the current state of the economy, he said, "It remains very severe, although it is not spiraling downward."