People walk on a street in Tokyo's Ginza area at dusk. Photo: AFP

Japan's government is considering resuming subsidies aimed at promoting domestic tourism as early as mid-January, the Nikkei newspaper reported on Sunday.

The move will ease the strain on airlines and hotels hit by shrinking travel from the coronavirus pandemic, and underscore hopes among policymakers to reflate the economy out of the doldrums through pent-up demand.

The subsidies will be part of Prime Minister Fumio Kishida's new pandemic-relief program expected to be compiled on Friday. 

As COVID-19 infections began to rise, Japan halted in December 2020 a program that used taxpayers' money to offer domestic tourists discounts for hotels and domestic travel fees.

On request from the tourism industry, the government will consider resuming the program from mid-January or February, until around late April, the Nikkei said.

The government will offer bigger discounts for travel during the weekdays compared with those on the weekend, to avoid trips being concentrated during the weekend, it said.

It will also lower the maximum amount of discount offered per travel compared with the previous program, the Nikkei said without citing sources.

The government was not immediately available to comment.

Japan's economy likely contracted an annualized 0.8 percent in the third quarter as supply constraints and state of emergency curbs to combat the pandemic hit exports and consumption, according to a Reuters poll. 

Reuters