Press Conference by Kaoru Yosano, Minister of Finance and Minister for Financial Services and Economic and Fiscal Policy
March 31, 2009
[Questions and Answers]
I understand that together with the Prime Minister, you are leaving for London today. Some people think that since as many as 20 countries participate in the G-20 summit, it is difficult to lead discussions to a conclusion. Could you tell us with what stance Japan will participate in the meeting and what conclusion you would like to reach?
To my mind, Japan’s stance has not changed at all since Prime Minister Aso visited Washington late last year. To deal with the global economic and financial crisis, it is necessary that individual countries cooperate with each other, rather than acting separately. Japan’s resolve to make the greatest possible contributions to the international community under the framework of international cooperation remains unchanged.
I believe that countries around the world share the recognition that it is necessary to build a new framework of oversight and regulation of financial transactions. Although it may take time, the Japanese government strongly feels the need to do it so as to prevent a recurrence (of the financial crisis).
As for fiscal stimulus, under two supplementary budgets adopted last year and the initial budget for fiscal 2009, Japan already earmarked fiscal expenditures that were regarded as sufficient when the budgets were compiled. However, the economic outlook has changed considerably since the budgets were compiled in December. In relation to this, I expect the Prime Minister to issue some instruction today. In this respect, the Prime Minister will probably reveal in London that the Japanese government is considering fiscal stimulus.
It is also urgently necessary to realize a recovery of emerging economies, and Japan will tackle this matter with a resolve to support these economies through all available international organizations and bilateral cooperation and by using Japanese organizations and schemes, such as JBIC (Japan Bank for International Cooperation) and trade insurance. Also, I believe — this is most important — that the G-20 should take a strict approach toward preventing the rise of protectionism, watching out for any small signs of protectionism.
This morning, the LDP’s (Liberal Democratic Party’s) project team on the global financial crisis adopted an additional policy package for stabilizing the market, which included a measure to prepare for the purchase of ETFs (exchange-traded funds) in the market. How do you view this measure, which is apparently very unusual, as it represents government intervention in the market?
I think this measure is appropriate as it has been considered on the premise that it will be invoked not frequently but only when a stock price slump caused by an extraordinary situation could inflict major damage on the Japanese economy.
You said earlier that following the adoption of the LDP’s proposals, the government will conduct deliberations. Could you tell us about any time frame?
Although I would like to proceed with a sense of urgency, an agreement has not been reached on specifically when we will start our deliberations.
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