Press Conference by Shozaburo Jimi, Minister for Financial Services

(Excerpt)

(Tuesday, February 21, 2012, from 8:46: a.m. to 8:54 a.m.)

[Opening Remarks by Minister Jimi]

Today, I do not have any announcement to make.

[Questions & Answers]

Q.

I will ask you two questions.

The first question concerns exchanges. Recently, there have been various media reports about the realignment of exchanges, such as the Tokyo Grain Exchange and the Tokyo Commodity Exchange. Could you tell me about the view of the Financial Services Agency (FSA) as the supervisory authority of exchanges on what the future of exchanges should be like in light of the plan to establish a comprehensive exchange?

A.

As you know, deliberation is ongoing on the plan to establish a comprehensive exchange at the study team on a comprehensive exchange, which is comprised of the senior vice ministers and parliamentary secretaries of the FSA, the Ministry of Agriculture, Forestry and Fisheries, and the Ministry of Economy, Trade and Industry. I understand that on Monday, January 16, the senior vice ministers of the three government organizations held consultations and reached a consensus that the regulatory and supervisory authorities concerning a comprehensive exchange should be unified.

We believe that implementing the plan to establish a comprehensive exchange is very important for the future of the Japanese market, so we will work on the details of a necessary bill with a view to its submission to the current Diet session while maintaining cooperation with other relevant government organizations and listening to the opinions of relevant parties, including exchanges and traders.

In any case, the plan to establish a comprehensive exchange is included in the New Growth Strategy that was adopted upon a cabinet decision, as I already mentioned, so it is very important for the future of the Japanese market to implement the plan by exercising political initiative while seeking understanding from various quarters.

As I have repeatedly told you, government organizations have their own long histories and traditions. When I recently inspected the Osaka Securities Exchange, I learned that the world's first futures trading for rice was done in Osaka. Futures trading for agricultural commodities is under the jurisdiction of the Ministry of Agriculture, Forestry and Fisheries. Futures trading for minerals is under the jurisdiction of the Ministry of Economy, Trade and Industry. Even so, we will proceed with the drafting of the necessary bill with a view to its submission to the current Diet session by exercising political initiative while carefully listening to the opinions of relevant parties, including exchanges and traders.

Q.

The second question concerns Tokyo Electric Power.

I understand that a comprehensive special business plan is close to being finalized. Regarding financial institutions in particular, it is said that requests for additional loans have been made. Whether additional loans should be provided and whether the government should acquire more than 50% of the voting rights of Tokyo Electric Power through capital injection have apparently become major issues of debate. As the supervisory authority of financial institutions that provide financial support, how does the FSA view these issues?

A.

Concerning this case, last year, I, along with Mr. Yosano, joined the relevant cabinet task force on response to the economic damage caused by the nuclear station accident halfway through its debate. As I stated at that time, the FSA refrains from commenting on what kind of support Tokyo Electric Power will request from financial institutions and how stakeholders, including financial institutions, should respond to the request, as those are matters that should be negotiated between private business operators.

In any case, regarding damage compensation by Tokyo Electric Power, while paying compensation in a prompt and appropriate manner, and ensuring a stable supply of electricity are very important, it is also important to avoid producing unnecessary or unforeseen adverse effects on the financial and capital markets as a whole, so we will continue to carefully monitor market developments.

Q.

Let me ask you about the European debt problem. Negotiations on an aid package for Greece are apparently close to a conclusion. What is your view on this matter? Also, do you think that if the aid package is adopted, the European debt problem will entirely be resolved?

A.

I am aware that the euro-zone finance ministers held a meeting on Monday, February 20, European time, and that debate on aid for Greece is ongoing.

As the details of the debate have not been made public, I would like to refrain from making specific comments. However, as I have been saying all along, I believe it is essential that in addition to extending aid to Greece in order to deal with the European debt crisis, Europe should adopt and steadily implement a comprehensive package of measures which realizes economic recovery as early as possible, and which simultaneously improves the fiscal deficit and regains the trust of financial markets. Japan will continue to carefully monitor the situation.

Q.

Do you expect that the adoption of the financial aid for Greece will entirely resolve the European debt problem?

A.

From the beginning, I have made myself clear on that point. This is a European problem, so first of all, the 27 EU countries and the 17 euro-zone countries should think and act for themselves. As you know, the European leaders have apparently reached an agreement on fiscal discipline after working out various ideas, so I think that it is very important to take necessary steps and procedures one by one.

Although the crisis is still ongoing, I have the impression that necessary steps are being taken one by one.

Thank you very much.

(End)