China & Japan To Collaborate On IMF Decisions
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Asia’s two largest economies, China and Japan, have agreed to coordinate their efforts to support any IMF funding, said Japanese finance minister Jun Azumi on Monday, with ministers from both countries preparing for a G-20 meeting in Washington later this month.
“Rather than make decisions independently, we’ve agreed to consult each other very closely,” said Azumi, after meeting with his Chinese counterpart Xie Xuren over the weekend.
Asia’s two largest economies, China and Japan, have agreed to coordinate their efforts to support any IMF funding, said Japanese finance minister Jun Azumi on Monday, with ministers from both countries preparing for a G-20 meeting in Washington later this month.
“Rather than make decisions independently, we’ve agreed to consult each other very closely,” said Azumi, after meeting with his Chinese counterpart Xie Xuren over the weekend.
[quote]“There is a need for Japan and China to cooperate to prevent crisis in Asia,” he added, as cited by Bloomberg Businessweek.[/quote]Related: Japan Economy
Related: The Chinese Economy
Though Azumi denied that the region’s two largest economies had already reached an agreement on whether to extend additional money to the IMF, the Japanese finance minister noted that the two countries would continue to discuss the matter through “various channels.”
“It won’t probably be smooth for G-20 nations to hammer out details for their contributions to the IMF,” said Tomoko Fujii, a senior foreign-exchange strategist at Bank of America Merrill Lynch in Tokyo, before Azumi and Xie met.
[quote]“It’s important for Japan to check China’s intention on this, while China probably wants to increase its political influence if it puts up money.”[/quote]The IMF asked in January for as much as $500 billion in additional lending resources. But IMF members have thus far been reluctant to pitch in – insisting that European nations do more to help themselves first. Even the United States, which has the biggest financial stake in the IMF, has refused to increase its contribution.
“The firewall European nations presented in March isn’t convincing enough to give momentum to discussions for other countries’ financial contributions to the IMF,” noted Fujii.
Azumi said that Xie and himself had agreed that “the crisis was not yet over but (the global economy) is moving in a good direction.” Azumi stressed that “the Asian economy must lead a global economic recovery,” while “Europe’s crisis hasn’t ended” and needs “careful monitoring.”
The ministers’ talks in Tokyo kicked off the latest round of biannual financial policy meetings between the two countries. Officials on both sides are also trying to hammer out the details of an earlier agreement that would allow Japan to start buying Chinese government bonds. Both sides will also promote the use of their own currencies instead of the dollar in bilateral trade.
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