Japan subsidizing energy-efficient plants

JAPAN - Japan's government plans to subsidize domestic plants producing clean-energy and energy-efficient goods under steps to support the slowing economy, the Nikkei newspaper said, as the murky outlook keeps firms from boosting spending at home.

A strong yen is putting additional pressure on Japan's fragile economy, which is already seeing slowing growth and mired in grinding deflation, forcing the government to consider drafting a package of stimulus measures.

In a draft version of the stimulus package, the government plans to subsidize investment in domestic plants manufacturing goods such as lithium battery cells for electric vehicles, the Nikkei said.

Another proposal is to extend the deadline for subsidies aimed at encouraging households to purchase energy-efficient consumer electronics, the paper said.

It will also extend a housing loan program, which was scheduled to end this year, that reduces annual interest on 35-year fixed-rate loans for energy-efficient and quake-resistant homes.

Economics Minister Satoshi Arai has submitted the draft stimulus plan to Prime Minister Naoto Kan.