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Prefecture struggles for budget deficit solutions

Date Posted: 2006-01-12

Okinawa Prefecture is looking for Y300,000,000,000.

The prefecture isn’t broke, but acknowledges it is trillions of yen short of what’s needed to meet its budget requirements. The Trinity Reform Plan has forced major budget cutbacks at all levels of government, and Okinawa Prefecture’s dilemma is not unique. Welfare reform changes have spawned massive new requirements for funding, sending local and state governments to the drawing boards to find ways to get the money.

Okinawa Prefecture is taking the axe to dozens of programs and projects, and is deferring construction projects. Still, it is more than a short term financial problem, forcing the Prefecture to postpone making debt payments, cut payrolls and break into emergency funds. Still, money is 150% tighter than a year ago, and officials say there’s no solution in sight.

Four prefecture funds, including retirement allowances and peoples insurance funds, are being tapped to provide ready cash. Next year’s retirement budget alone is Y18,000,000,000, and the prefecture says it can’t even afford to pay this year’s amounts due. Citizens are beginning to feel angry and betrayed, knowing they’ve been paying into these accounts for 30-35 years, and now may not receive their benefits.

“No budget. No money.” That’s the Okinawa Prefecture answer, but business community leaders are arguing it’s not good enough.

The bright spot in Okinawa business is the United States military, and businessmen are saying there needs to be more effort focused on keeping the military bases instead of dumping them. They note a November conference at the Okinawa Convention Center, when the Naha District Employees Promotion Committee Group offered tips on how to get business from the military bases. Organizers had expected a handful of attendees, but instead found themselves talking to more than 300 businessmen.

The talk now is focusing on getting the prefecture to think about the economy, instead of making the bases go away. The Employees Promotion Committee says ”new business chances are as close as your doorway”, and encourages businesses to speak out to the Prefecture. They’re urging cooperation with the military, making Okinawa rich and peaceful.

The note that plenty of business is generated by the American military. Construction work, food, souvenirs, stationary and travel are good money, and officials note doing business with the U.S. is simple, with far less paperwork than dealing with complicated Japanese business entities. Another plus to the Americans, the Okinawan business leaders point out, is the military always pays. “It’s perfect. They’re never late, and it’s always safe payment,” said one businessman who deals with the bases. “If the military goes away,” we are out of jobs,” he says. “We don’t want to do business with any other people than the military.”

Another business group notes the military is the primary support for the Okinawa economy and local economic life. “Everyone from land owners to contractors to ordinary workers benefit,” he says. “Everybody must think about the economic future.

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