Japan quake reconstruction can cost up to $ 184 billion: Yosano

TOKYO - Japan's economy Minister Kaoru Yosano said Sunday that the Government may need to spend 10 billion yen to 15 billion yen ($184 billion) for the reconstruction of the devastating earthquake that struck the country in the northeast in March.

The Government may need to issue bonds to pay but should not be so without coming up with the means to pay for the redemption, Yosano said, that some form of tax hike would be inevitable signaling.

"I understand those who say that we need to issue bonds for quake (reconstruction)." "But we should not borrow recklessly without thinking about how to pay the money," Yosano told a television program.

"If we were to issue bonds for the reconstruction, we must decide in how many years would pay us the money back and how." "It is important in maintaining the confidence of the market in the financial state of the Japan," he said.

Japan is reeling from the triple disaster from an earthquake, tsunami, and the prolonged nuclear crisis with the Government of the difficulty in finding ways to pay for the largest reconstruction effort since the aftermath of the second world war.

The damage caused by the earthquake led to the Japan in the recession with the economy decreases much more than expected in the first quarter and the value of the contract again in April-June as shortages of electricity and chain disturbances hit factory output supply.

The Government earlier this month Parliament adopted a supplementary budget of 4 billion yen first to meet the cost of immediate disaster relief.

It plans to compile a sizable second supplementary reconstruction budget, though legislators are divided on how to pay the expenses.

The public debt of the Japan, to double the size of the economy of $ 5 trillion, is the most important among the major industrialized economies, limiting the room for additional fiscal stimulus.

But legislators are reluctant to raise the tax, including the politically sensitive sales tax, for fear of scaring voters away, even while the cost of the reconstruction of quake adds to the huge social spending for aging fast society.

Yosano, considered as a fiscal Hawk, said that raising taxes is crucial for the Japan meet the costs of protection social bloat and to fix the country Scud finance.