Japan warns France to stick to fiscal reform plans

Japan on Tuesday warned French president-elect Francois Hollande to keep the nation's fiscal discipline in place amid worries that the new leader will overspend in a bid to boost the economy.

Sunday's victory for Socialist Hollande -- and the huge losses for the two main parties in Greece -- came amid a backlash against the austerity measures put in place across Europe to tackle the region's debt crisis.

But Finance Minister Jun Azumi told a regular news conference in Tokyo: "Our stance is unchanged.

"We want (France) to do what has been decided so far, and I'd like to tell them about that if there is the opportunity," he added, according to Dow Jones Newswires.

"I don't know whether Mr Hollande will immediately act on what he has said in heated debates during the election campaign.

"But realistically, I think it is impossible (for European nations) to give up on fiscal-rebuilding efforts," the finance minister said, adding that he was "convinced (Hollande) will respect this movement."

Hollande ousted conservative Nicolas Sarkozy from the Elysee Palace on a platform promising growth rather than further cuts, which has worried many European leaders who fear it will lead to another region-wide crisis.

Azumi said Monday that France's new leader "fully understands" the need to rebuild Europe's finances, despite his calls to review the European Union's fiscal pact to include measures to spur growth. The treaty now stresses austerity efforts.

"I want him to act based on understanding the schemes and thinking that we, the IMF, and the G7 have cultivated up to now," Azumi said.

Azumi also warned on Monday that the election results in France and debt-strapped Greece could have a "destabilising" effect on markets.

He added said he would respond "properly and appropriately" to any speculative-driven gains in the yen, which makes Japanese exports less competitive, and reduces the value of their foreign income.

Japan has previously intervened in currency markets to tame the yen's soaring value amid fears over its impact on the world's third-largest economy.

"We must closely watch whether there are speculative movements taking advantage of political factors," he told reporters Monday.

Following the elections, the euro skidded to $1.2954 in early trade Monday, its lowest level since late January, while also slumping to 103.22 yen at one stage, its worst since mid-February.

However, it rebounded late Monday and on Tuesday it was at $1.3033 and 104.24 yen.

Japanese Prime Minister Yoshihiko Noda congratulated Hollande after his victory during a brief telephone call and told him France was a "strategic partner" of Japan, according to a foreign ministry official.

The pair agreed to work together on Europe's debt crisis and North Korea's nuclear programme, the official added.

Last month, Japan pledged about $60.0 billion to the International Monetary Fund, calling the contribution a critical part of the US-based organisation's bid to boost a global firewall against Europe's debt crisis.

Azumi said at the time that Tokyo's help was "crucial not only to the eurozone but also to Asia and Japan if we are to ensure that the crisis is completely over."

The move came as the country struggles with a strong yen and sinking demand in key European markets, which has dented the export-oriented economy.

Tokyo has also been a regular buyer of debt issued by the European Financial Stability Facility bailout fund since last year.

Loading...

Editor’s note:Yahoo Philippines encourages responsible comments that add dimension to the discussion. No bashing or hate speech, please. You can express your opinion without slamming others or making derogatory remarks.

  • NCCA plans to conduct mapping of Pag-Asa Island
    NCCA plans to conduct mapping of Pag-Asa Island

    The National Commission for Culture and the Arts (NCCA) plans to send researchers to conduct a cultural mapping of Pag-Asa Island, which is part of Philippine-held territories in the disputed Spratlys in the West Philippine Sea. Harold Rentoria, NCCA committee on cultural heritage commissioner, admitted that since two years ago they have been thinking of going to Pag-Asa Island for their cultural mapping project. Cultural mapping is part of the NCCA program Taoid – the Ilocano word for …

  • No CNN interview for senators in ‘pork’ scam
    No CNN interview for senators in ‘pork’ scam

    Cable News Network (CNN) Philippines has been denied a chance to interview detained Senators Juan Ponce Enrile, Bong Revilla, and Jinggoy Estrada, a Sandiganbayan justice said yesterday. Sandiganbayan Presiding Justice Amparo Cabotaje-Tang told The STAR CNN’s request for an interview with the lawmakers, who are being held without bail at Camp Crame, will not be allowed as such may violate a rule preventing parties to an ongoing trial from discussing the merits of the case. CNN Philippines …

  • Tropical depression intensifies into storm
    Tropical depression intensifies into storm

    The tropical depression expected to enter the Philippine area of responsibility on Thursday has intensified into a storm, the state weather bureau said yesterday. PAGASA is looking at two scenarios for Noul. Ignacio said there is a probability that the storm would veer north or toward Southern Japan before it approaches landmass early next week. …

  • PNP to car buyers: Demand LTO plates
    PNP to car buyers: Demand LTO plates

    Those who plan to buy new cars should make sure their car dealers give them their Land Transportation Office plates as soon as possible to avoid being targeted by car thieves, the Philippine National Police (PNP) said yesterday. Senior Superintendent Arnold Gunnacao, director of the PNP-Highway Patrol Group (HPG), said car theft syndicates are particularly interested in stealing brand new sport utility vehicles (SUVs) with conduction stickers serving as temporary license plates. …

  • SE Asia Stocks-Mixed; Indonesia and Philippines end losing streak

    JAKARTA, May 4 (Reuters) - Southeast Asian stock markets traded mixed on Monday with stocks in Indonesia and Philippines rebounding after a recent bout of weakness. The Indonesian stock index closed up ... …

  • 2 coast guard men, village chief, abducted in Philippines

    MANILA, Philippines (AP) — Police say gunmen clad in military uniform have abducted two Philippine coast guard personnel and a village chief on a southern island then sped away in two motorboats. …

  • Filipino on US most wanted list killed: rebels, military
    Filipino on US most wanted list killed: rebels, military

    A Filipino on the United States' list of most wanted "terrorists" has been killed in a firefight in the southern Philippines, Muslim rebel leaders and the military said Monday. Abdul Basit Usman was killed in a remote mountainous area while being escorted by members of the Moro Islamic Liberation Front (MILF), the nation's biggest rebel group, its vice chairman Ghazali Jaafar said. Security forces had been hunting Usman since he escaped from a January police raid that killed Malaysian …

  • SE Asia Stocks-Mixed; Indonesia ends 7-day losing streak

    JAKARTA, May 4 (Reuters) - Southeast Asian shares mostly traded mixed on Monday, with Indonesia and the Philippines rebounding after a recent bout of weakness. Indonesian stock index rose 1.3 percent after ... …

POLL

Should Aquino be held accountable over the Mamasapano operations?

Loading...
Poll Choice Options