(Provisional translation)

Summary of remarks by Kaoru Yosano, Minister of Finance and Minister of State for Financial Services and Economic and Fiscal Policy, at the Committee on Financial Affairs of the House of Representatives

February 19, 2009


I have been involved in the Aso Cabinet’s conduct of economic and fiscal policies as Minister of State for Economic and Fiscal Policies. This time, as I have been appointed to serve concurrently as the Minister of Finance and the Minister of State for Financial Services, I would like to make a few remarks at this committee.

(Measures addressing the recent economic and financial situation)

I would like to begin by discussing the measures to address recent economic and financial developments.

The financial crisis that erupted in the United States and Europe has had a negative impact on the real economy, including through credit crunch, and the global economy has fallen into a severe downturn. Japan’s economy also continues to deteriorate rapidly and it is not too much to say that this situation is the worst economic crisis in the period since the end of the Second World War.

The government has put together a series of economic measures totaling approximately 75 trillion yen, comprising approximately 12 trillion yen allocated to fiscal response measures and approximately 63 trillion yen allocated to financial responses. In order for these countermeasures to be effective, we believe it necessary to implement the budget for FY2009 in tandem with the first and second supplementary budgets for FY2008 in a seamless manner.

To this end, we will promote prompt execution of public works related to making school buildings earthquake-proof and to disaster prevention as far as possible. We are also making preparations for execution of public works in other areas so that they can be executed as soon as the relevant bills are passed by the Diet and take effect. Furthermore, we ask for early approval by the Diet of the initial budget for FY2009, and upon its approval, we intend to execute the budget promptly from the beginning of the fiscal year.

At present, Japan’s financial system is relatively stable compared to those of the United States and Europe. However, due to the increasing impact of the volatile stock market and the deteriorating real economy, we will keep a close watch on the situation, maintaining a high level of vigilance.

In addition, corporate funding is facing extreme difficulties amidst the rapid deterioration of Japan’s economy. Thus, it is increasingly becoming important for financial institutions to give full play to their financial intermediary function in an appropriate and active manner. In order to further put in place an environment that allows financial institutions to supply funds with confidence, we have been taking various measures, including prompt enforcement of the amended Act on Special Measures for Strengthening Financial Functions. We will continue to encourage financial institutions to play their role in financial intermediation in an effective manner.

(The bills submitted to this Diet)

I will give you an outline of the bills which we will ask you to deliberate on.

In the current session of the Diet, the Bill on Special Provisions concerning Issuance of Public Bonds and Transfer of Funds from the Special Account for Fiscal Investment and Loan Program to Secure Necessary Financial Resources for Fiscal Management and the Bill for Partial Amendment of the Income Tax Act, etc., are already under deliberation. We also have submitted the Bill for Partial Amendment of the Customs Tariff Act, etc., and the Bill for Partial Amendment of the Act on Measures Associated with Membership of the International Monetary Fund and the International Bank for Reconstruction and Development.

In addition, we plan to submit to the Diet the Bill for Partial Amendment of the Financial Instruments and Exchange Act and the Bill on Payment Services, and are currently considering submitting the Bill for Partial Amendment of the Act on National Public Service Personnel Mutual Aid Association to the Diet.

Given the current economic and financial situation, it is vital to adopt the budget for FY2009 and the budget-related bills by the end of this fiscal year and to implement policies that will protect the people’s daily lives and Japan’s economy. The other bills also need to be adopted as soon as possible so that the necessary measures can be implemented promptly. I hereby ask you to deliberate on these matters and give your approval.


In these remarks, I have stated some of my ideas as the Minister of Finance and Minister of State for Financial Services. I am determined to continue — with your support — to do my best in policy management.

I would appreciate the understanding and cooperation of chairman Tanaka and all the other members of this committee.

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