Japan will seek progress in talks over whether to boost resources at the International Monetary Fund when the Group of 20 finance chiefs gather later this month in Washington, Finance Minister Jun Azumi said Tuesday, apparently pushing for a step forward in helping address Europe’s sovereign debt crisis.
Azumi also said Japan, the second-biggest stakeholder in the IMF after the United States, is ready to play a key role in discussing the request, mainly from Europe, to increase the IMF’s financial firepower to prevent the crisis from dragging down global economic growth.
“I believe it would be good for the markets and global economy if we can reach a certain level of progress when we gather in Washington on April 20,” Azumi said, ahead of the talks by finance ministers and central bank governors from the G-20 advanced and major developing economies on the sidelines of the biannual meetings of the IMF and World Bank.
The comment indicates Azumi has somewhat eased his position. He said earlier that Tokyo would never advocate increasing IMF resources unless European leaders first act decisively to help themselves.
Japanese officials “appreciate it to some extent,” Azumi said in reference to the agreement last week by the eurozone’s finance ministers to expand their bailout funds to prevent contagion from the fiscal problems in Greece, Ireland and Portugal spreading to bigger members like Spain and Italy.
Tokyo is ready to lead necessary discussions on whether and how to boost the IMF’s resources, Azumi said, as the United States has shown reluctance to be aggressively involved in any fresh round of resource boosting.
“I think we are in a position that requires us to actively coordinate opinions from relevant countries,” he said, showing his intention to hold talks with his counterparts from other key IMF members such as China and Germany, which is also the paymaster of the 17-nation euro area.
The move came after Prime Minister Yoshihiko Noda told German Chancellor Angela Merkel over the telephone Monday that Japan will specifically consider its contribution to raising IMF resources following the eurozone ministers’ decision Friday to boost the combined ceiling for their temporary and permanent rescue funds to €700 billion from €500 billion.
The IMF in January estimated it will have to raise up to $500 billion in contributions from member countries as part of efforts to meet global financing needs over the coming years. But Azumi said he won’t regard that figure as “standard.”
Some Japanese officials have said Tokyo is considering a range of options, including extending $50 billion in emergency loans to the IMF’s general account.
While declining to comment on specific measures, Azumi said, “We will decide on how we could contribute (to the IMF) as well as whether we would call for further efforts by Europe, by the G-20 meeting in Washington.”
He said the G-20 could possibly “show a combined amount” of funds offered by some of its members after the meeting. This means, however, the group may fall short of unveiling the names of possible contributors and the amount of their contributions.
Azumi announced that Japan and China will hold financial talks Saturday in Tokyo. He will meet with Chinese Finance Minister Xie Xuren during the dialogue, which has taken place every two years.
The meeting comes after Japan and China recently agreed to enhance cooperation in the field of international finance, including the mutual buying of government bonds, as well as encouraging Japanese and Chinese firms to use the yen and yuan in settling bilateral trade, instead of the dollar.