Prime Minister Junichiro Koizumi should “frankly” explain Japan’s current economic situation to U.S. President George W. Bush during their first summit scheduled for Saturday in Camp David, Md., Finance Minister Masajuro Shiokawa said Wednesday. “It is important that (the two leaders) nurture mutual trust,” Shiokawa told a regular news conference. “It is best to explain the current state of the economy frankly.”

However, it is unlikely the two leaders will discuss currency matters, Shiokawa said. “I don’t expect any remarks on foreign exchange issues, though they will discuss economic developments.”

Commenting on the budget for next fiscal year, the finance chief said it is necessary to earmark yet another reserve fund for unspecified public works projects, a controversial fund Koizumi has been reluctant to authorize.

For three years in a row since fiscal 1999, the government has set aside 300 billion yen to 500 billion yen in each budget to “ensure economic recovery.” But the funds have only been used as a means to settle political squabbles among lawmakers representing special industrial interests.

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