U.S. urges Japan to continue financial crack supply
sg.dailynews.yahoo.com
US urges Japan to continue appropriate economic measures
BANDAR SERI BEGAWAN, Sept 9 (AFP) -
The United States on Saturday urged Japan to continue to take appropriate economic measures to ensure the recovery of the
world's second-largest economy.
"We hope that Japan will continue to take appropriate economic measures," said US Treasury Secretary Lawrence Summers,
quoted by a Japanese finance minister official as telling Finance Minister Kiichi Miyazawa.
Summers and Miyazawa held a 35-minute meeting on the sidelines of a two-day finance ministers meeting here of Asia Pacific
Economic Cooperationforum.
The Japanese finance minister assured Summers that Tokyo would continue to lead the economy to recovery.
"We will continue to take appropriate economic measures," Miyazawa told Summers.
On Monday, the Japanese government will release figures of gross domestic product (GDP) for three months to June.
The consensus forecast among economists is for the April-June GDP figure to show growth of 0.9 percent over the previous
quarter, for an annualised expansion of 3.8 percent.
That would compare with 2.5 percent GDP growth in the three months to March from the previous quarter, and annualised
growth of 10.3 percent.
Miyazawa told Summers the April-June GDP data would be crucial in determining the size of a supplementary budget for the
current financial year to March 2001.
"We will decide the size and the nature of the supplementary budget based on the April-June quarter data," he said.
Miyazawa also discussed the Bank of Japan's decision on August 11 to end its zero interest rate policy, the Japanese finance
ministry official said.
Summers "neither urged Japan to stimulate private demand nor called for structual reform," the official said.
Although the APEC meeting here was dominated by rising oil prices, neither Summers nor Miyazawa mentioned this during the
meeting, he added.
Earlier, Miyazawa told APEC finance ministers Japan's economy had been steadily picking up.
"The pace of Japan's economic recovery is slow but the corporate sector is doing well. However, consumer spending remains
flat," Miyazawa told a news conference before meeting with Summers.
"I told participating APEC finance ministers that the basic undertone of the economic recovery has remained unchanged," he
said.
Although Miyazawa opted to keep quiet on the size of an extra budget, he argued Japan should not depend on government
bonds to support its economic recovery.
"As I have said repeatedly, I want to reduce the amount of government bonds," he said.
On Friday, Moody's Investors Service downgraded Japan's yen-based government bonds in a dramatic sign of alarm over the
growing mountain of state debt.
The domestic currency rating for state debt was cut to "Aa2" from "Aa1," with an unchanged negative outlook, the New
York-based agency said in a statement.
"Moody's raised concern over government bonds. We should handle this matter in order for us not to regret it later,"
Miyazawa said of the growing debt.
"But in my opinion, we are not going to be in such a situation," he said.
Also, Budget Reform, Not Budget Tricks
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