G-20 urged to discuss structural reforms

JIJI

The Group of 20 top finance officials should address structural issues such as capital control in emerging economies in order to boost medium- and long-term global economic growth, according to former Bank of Japan Executive Director Eiji Hirano.

While acknowledging that a scaling back of quantitative monetary easing by the U.S. can cause short-term capital outflows from emerging economies, Hirano said structural problems such as inefficient regulations are often the cause of falls in currency values and stock prices.

“If they (policymakers) are preoccupied with short-term issues such as monetary easing and fail to promote discussions on resolving structural problems, medium- and long-term growth will not be strengthened,” Hirano said.

Hirano, vice president of Toyota Financial Services Corp., was speaking in a recent interview, before two days of talks from Friday in Moscow between finance ministers and central bank chiefs of the G-20 major advanced and emerging economies.

Although emerging economies such as China have clearly cooled off, Japan and the U.S. remain strong, Hirano noted.