Business leaders from Japan and the U.S. expressed support Monday for Prime Minister Junichiro Koizumi’s efforts at economic reform, but they urged him at the same time to take concrete steps and show political leadership to achieve the goal.
The corporate executives were meeting at a Tokyo hotel for a two-day U.S.-Japan Business Council and agreed during the first day that solving the problem of nonperforming loans is one of the most urgent tasks facing the Japanese government.
“It remains clear that Japan needs to move ahead in reform, especially aggressive efforts to solve the nonperforming-loan problem, accelerate deregulation and encourage foreign direct investment,” said AT&T Chairman and CEO Michael Armstrong, the U.S. chairman of the conference.
He also said that U.S. business leaders were encouraged by Koizumi’s determination to tackle the bad-loan issue.
Toyota Motor Corp. Chairman Hiroshi Okuda, who is also chairman of the Japan Business Federation, told the meeting that the Japanese business community wholeheartedly supports Koizumi’s reform efforts, adding that the appointment of Heizo Takenaka to minister of financial affairs “reflects Prime Minister Koizumi’s determination to solve the bad-loan problem.”
“So what we need is the political leadership to put it into effect,” he said.
Koizumi, who was a guest speaker at the meeting, said the government will show some policy direction toward the resolution of banks’ bad-loan problems in six months.
“We will make clear our direction by accelerating disposals of bad loans within a half-year,” he said
Koizumi also said he will push ahead with reforms primarily in four areas — finance, tax systems, regulations and government expenditures.
“We will try to bring the economy back on a sustained growth path by implementing (the reforms) under the budget for fiscal 2003,” Koizumi said.
However, he was elusive when Armstrong asked him how to strengthen the capital structure of the country’s banking system, merely saying concrete measures are to be announced soon.
Toshiba Corp. Chairman Taizo Nishimuro is the Japanese chairman of the annual gathering.
Some 70 business leaders from Japan and the U.S. will discuss issues including corporate governance, information communication technology, the service industry and the manufacturing sector. The conference was to close Tuesday after adopting a joint statement.