South Korean government officials on Wednesday joined an international chorus in decrying Tokyo's efforts to talk down the yen, with one hinting at intervention.
In Tokyo, Han Seung Soo, South Korea's minister of foreign affairs and trade, met with the secretaries general of the three ruling parties and asked them to press their government to adopt a policy of preventing a weaker yen, coalition lawmakers said.
Referring to the currency's recent sharp depreciation, Han said Japan is trying to solve its economic woes by unleashing a weaker yen on global markets, according to the lawmakers.
In Seoul, Jin Nyum, South Korea's finance and economy minister, also expressed concern over the yen's depreciation, saying Japan should take steps to prevent the yen from sliding.
"Considering (Japan's) current account surplus, I would say it's a dangerous policy to resort to exchange rates to boost the economy," said Jin, who also serves as deputy prime minister.
In principle, exchange rates should be left to the market, he said.
"But it would be possible to conduct smoothing operations through consultations with the International Monetary Fund," he added, indicating South Korea may intervene in the currency market to redress the yen's decline.
The comments came on the heels of a similar tongue-lashing delivered the day before by visiting U.S. Treasury Secretary Paul O'Neill. Earlier in the month, Malaysian Prime Minister Mahathir Mohammed complained to Prime Minister Junichiro Koizumi about Japan using exchange rates in place of a coherent economic policy.
Earlier Wednesday, Han met with Yukio Hatoyama, leader of the opposition Democratic Party of Japan. Hatoyama agreed with Han that Japan and South Korea should conclude a free-trade accord, adding that trade liberalization in Asia is desirable, according to DPJ lawmakers.
Han said he expects an accord to be a starting point for establishing an Asian consortium.
Han noted that bilateral relations have been rocky over the past year but added they have improved somewhat since Prime Minister Junichiro Koizumi's visit to South Korea in October.
Han thanked the DPJ for its efforts to calm tensions during a series of recent bilateral disputes, including Koizumi's visit in August to Tokyo's Yasukuni Shrine which honors Japanese war criminals alongside the country's war dead.
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