TOKYO – The Japanese government has formally approved a massive 20.2 trillion yen ($227 billion) stimulus package during a cabinet meeting on Friday morning, reports the Daily Yomuiri.

The national government will spend 10.3 trillion yen ($116 billion), with nearly the same amount kicked in by local governments and the private sector, according to Kyodo.

"We need to say good-bye to the shrinking economy and aim to achieve a strong economy where innovation and new demand lead to more jobs and income," said Prime Minister Shinzo Abe during a press conference after the cabinet meeting. 

Photo Shinzo Abe

According to Dow Jones Newswires, the stimulus package will focus heavily on upgrading ageing infrastructure and making more schools, hospitals, roads, bridges and tunnels earthquake-resistant. It also includes increased investment in reconstruction projects in the coastal region devastated by the March 2011 earthquake and tsunami.

The stimulus plan also includes beefing up Japan’s Self-Defense Forces, with 180.5 billion Yen ($2 billion) going to new missiles, fighter jets and helicopters, reports the AFP.

Japan’s Nikkei stock index jumped 1.5% following Abe’s announcement.