Japan is ready to hold talks with other nations, including the U.S. and China, on how to answer the International Monetary Fund’s call for more resources to handle Europe’s sovereign debt crisis, Finance Minister Jun Azumi said Wednesday.
In an interview with The Japan Times and other media outlets, Azumi said the eurozone’s recent decision to raise its “firewall” bailout capacity to €700 billion “can be considered a step forward,” but the situation still requires close monitoring.
Persistent worries over the euro have helped the yen to surge to around 80 to the dollar again. The yen hit a record 75.35 against the dollar last year, but action by the Bank of Japan and other factors pulled it back to 84.18 in mid-March.
In advance of the meeting of Group of 20 finance ministers next week in Washington, Japan could enter high- and working-level talks with other countries to discuss what they can do to stabilize Europe, Azumi said.
“The role that Japan, U.S. and China play will have a huge impact” on whatever action IMF will take in handling the issue, he said.
Turning to the bill to raise the consumption tax to 10 percent, which the Cabinet approved late last month, Azumi said the administration must now swiftly move on to cutting spending and getting the public to back the hike.
“We need the people to have a certain amount of consent over the tax increase. That can come only if we cut spending by lawmakers or reduce the number of seats in the Diet,” Azumi said.
Another task will be to discuss in detail a tax return system for low-income households, he added.