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Concern over the current surge in crude oil prices dominated Saturday’s meeting of the finance ministers of the Asia-Pacific Economic Cooperation forum, APEC sources said.

A number of ministers “appealed for the stabilization of oil prices to sustain growth” on the first day of the two-day APEC gathering in the Brunei capital, a senior South Korean finance official said.

Among the countries voicing concern at the meeting were the United States, Australia, Mexico, South Korea and Thailand, the sources said.

Representatives from international organizations, including the International Monetary Fund and the World Bank, also expressed concern at the meeting, they said.

Crude oil prices surged close to $35 per barrel last week — their highest level since November 1990 — threatening to spark inflation and other disruptions in the world’s major markets.

APEC ministers are planning to express their concern in a joint statement they will issue Sunday at the end of the meeting.

A draft ministerial statement obtained Saturday by Kyodo News stated, “In the light of the risks posed by recent oil market developments to the world economic recovery, and for developing economies that are significant oil importers, we hope that supply constraints are eased and prices stabilized at sustainable levels to aid global economic development.”

Members of the Organization of Petroleum Exporting Countries are expected to meet in Vienna from Sunday to discuss whether to increase oil production so as to keep prices down.

A Thai official said, “Thailand is concerned about the rising energy prices because it will affect the poorest in the country most — the farmers.”

Mexico also expressed concern, even though it is one of the APEC members that produces oil.

“We cannot be a net gainer if this affects the rest of the world economy badly,” a Mexican official said.

The ministers also discussed proposals to set up study groups on banking standards, bank failure management and social safety nets, APEC sources said.

Stating Japan’s case

BANDAR SERI BEGAWAN (Kyodo) Finance Minister Kiichi Miyazawa on Saturday briefed his Asia-Pacific counterparts about Japan’s efforts to get its economy back on track.

“The Japanese economy continues to improve slowly, and there are some encouraging signs of recovery in the corporate sector,” Miyazawa said in a speech at the opening of a two-day meeting of finance ministers from the 21-member Asia-Pacific Economic Cooperation forum.

Miyazawa said personal consumption remains sluggish due to large-scale restructuring in the corporate sector, although there have been some increases in overtime work and job offers.

“Whether these positive aspects will spread throughout the entire economy depends on the degree to which business activities translate into increases in personal consumption,” he said.

The government will decide on the scale and timing of a supplementary budget for the current fiscal year once it sees the economic growth figures for the April-June quarter, due out Monday, he said.

On monetary policy, Miyazawa said the Bank of Japan, which lifted its “zero-interest-rate” policy on Aug. 11, has vowed to keep its monetary policy stance “unchanged and just as accommodative.”

Miyazawa also highlighted the “Chiang Mai Initiative” to create a network of bilateral swap and repurchase agreements, which was agreed by the finance ministers of the Association of Southeast Asian Nations, Japan, China and South Korea in May this year in Thailand.

He expressed hope that they can make progress in this area in time for the summit of ASEAN leaders and their counterparts from East Asia in November.

“Based on the experience of the Asian economies since the 1997 currency crisis, joint efforts and cooperation of the countries in the region have been crucial for their future prosperity,” he said.

Miyazawa also said Japan remains committed to helping Asian countries economically and financially.

“Japan has been instrumental in assisting its Asian friends rebuild their economic strength and prepare for future financial contingencies,” he said, alluding to the $30 billion package of support announced in 1998 by Japan to help pull its Asian neighbors out of the crisis.

“Japan is resolved to continue assistance in this region,” he said.

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