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Japan to prod U.S., Europe on crisis THE ASAHI SHIMBUN

2008/10/9 Print Share Article Japan will urge the United States and European countries to inject public funds into financial institutions to stabilize the markets during the Group of Seven meeting of finance ministers and central bankers, sources said.

Finance Minister Shoichi Nakagawa, who concurrently serves as state minister in charge of financial services, will express Tokyo's position at the meeting scheduled for Friday in Washington.

"I want to explain Japan's experience of how it overcame (similar financial) difficulties in the 1990s," Nakagawa said.

Although U.S. Congress last Friday passed a bailout package to buy financial institutions' bad loans, the financial turmoil has not subsided.

The Japanese government shares the market view that the U.S. government should inject public funds into financial institutions to increase their capital.

According to British media reports, the British government is also considering large-scale injections of public funds into banks to ease anxieties over their management.

On Tuesday, Prime Minister Taro Aso instructed Nakagawa to explain at the G-7 meeting that the Japanese government overcame its financial crisis in and after the 1990s by injecting taxpayers' money into ailing financial institutions including Resona Bank.

"Japan managed to tide over the financial crisis by injecting public funds," Aso later told reporters. "We did not create any problems for other countries. We can explain that experience with confidence."

Aso said Japan's financial system has received only minor damage from the current financial crisis stemming from the United States.

"But in the not-too-distant future, (negative) influences on Japanese economic activities will appear," Aso said.(IHT/Asahi: October 9,2008)