Japan to spend proceeds from BOJ's ETF sales on growth areas, PM says

TOKYO, Nov 6 : Japanese Prime Minister Sanae Takaichi said the government will use proceeds from the central bank's increased sales of exchange-traded funds (ETF) to fund spending on growth areas such as those critical to the country's economic security.

Her administration is looking for ways to boost non-tax revenues to finance its huge spending plans without relying too heavily on additional debt issuance.

"Additional proceeds from the (ETF) sales are fruits of Japan's economic growth, so it's appropriate to re-invest them for spending on crisis management and growth areas," Takaichi told parliament on Friday.

The BOJ decided on October 30 to increase annual sales of its ETF holdings to 860 billion yen ($5.5 billion) from 330 billion yen. A portion of net profit the central bank reaps each year, including from the ETF sales, is paid to state coffers.

Asked about the global market selloff after the US midterm elections, Takaichi said the government was watching market developments carefully, as heightened volatility was affecting economies across the globe.

"I am aware share prices, particularly those of AI and chip sectors, are falling sharply," Takaichi said. "We will focus on steps to create a strong economy" such as by beefing up industries where Japan has a competitive advantage, she said.