Japan and Europe have launched a concerted action on Friday to kick-start their faltering economies after a $14 billion rescue package for America's top automakers collapsed, deepening the worst financial crisis in 80 years. Collectively, both governments have unveiled $519 billion worth of growth stimulus measures aimed at reinvigorating the economic and financial sectors. Japanese Prime Minister Taro Aso on Friday announced a new 23 trillion yen stimulus package to shore up his country's economy, with measures to spur employment, encourage lending and inject capital into financial markets. “The global downturn is said to be a recession on a scale that comes once in a century,” Aso said. The new package includes 10 trillion yen ($111 billion) in tax breaks and public financing, and provides for up to 13 trillion yen ($144 billion) to address the credit crunch, including capital injections for lenders and other financial institutions. In London, the dollar slumped below 90 yen on Friday for the first time in 13 years after US lawmakers failed to pass a rescue plan for ailing American carmakers while the euro hit a record high against the pound. The dollar dropped to 88.40 yen at one point, the lowest level since August 1995. Meanwhile the British pound slid to 1.1182 euros - the lowest level since the creation of the European single currency in 1999. As the global financial picture continues to darken, governments are fast-tracking massive stimulus plans to shore up their economies. Friday's announcement comes on the heels of 27 trillion yen in measures announced in October, which included expanded credits for small businesses and a cash payout to every household to spur spending. “Since then the economy has worsened beyond our expectations,” Aso said. The total comes to at least 40 trillion yen, with some overlap in the two sets of financial measures. Aso pointed to falling stocks and the surging yen, and said the newest package was needed to boost employment and stabilize Japan's economic system. He said it would provide support including tax breaks for workers affected by the economic slowdown and homebuyers, as well as funds for injection into markets and support for mid-sized businesses. Before Aso's announcement on Friday, the yen surged to a 13-year high against the dollar. The US currency sank to 88.16 yen in afternoon trading in Tokyo, its lowest level since Aug. 2, 1995. A strong yen is especially painful for Japan's export-driven economy. European Union leaders backed a 200 billion euro ($264 billion) economic stimulus pact, British Prime Minister Gordon Brown said, despite German misgivings. The euro zone clearly needs a boost - data on Friday showed industrial output dived 5.3 percent year-on
