Japan Gov't Lends JBIC $3.9 B for Overseas Projects

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TOKYO (Dow Jones) - Japan's government announced Friday it will lend $3.9 billion of its foreign currency reserves to a government-affiliated bank to finance overseas projects by Japanese companies, including infrastructure and foreign acquisitions.The five-year loan to the Japan Bank for International Cooperation was made yesterday, officials said - a move that reflects the government's growing desire to tap overseas demand to make up for a slack domestic economy.Dogged by a shrinking population and entrenched deflation, the domestic economy shows little sign of staging a strong recovery any time soon. With the huge public debt making it hard to spend aggressively to jump-start growth, the government has shifted its emphasis to foreign demand, putting a 2009 pledge to create a domestic demand-driven economy on the back burner.Lending part of Japan's $1.1-trillion foreign reserves to the JBIC is in line with the policy spelled out in a stimulus package enacted late last year by the Democratic Party of Japan-led government.In that plan, worth a total of around [yen]5 trillion, the government promised measures to make the most of a strong yen, which hurts exporters but makes imports and overseas acquisitions cheaper. …