Japan ready to extend monetary support to I.M.F.

New York, Oct 14 (PTI) Calling for a greater role of the
International Monetary Fund to tide over the credit turmoil,
Japan Tuesday said the country is ready to offer financial
support to the multilateral funding agency to stabilise world
markets.
"We expect the I.M.F. to play a key role flexibly and
actively to cope with the current crisis, and Japan stands
ready to supplement needed funds if the I.M.F. requires
additional resources," Japanese Finance Minister Shoichi
Nakagawa said in a statement.
The minister has emphasised that capital injection into
financial institutions by utilising public fund is the most
important measure among the policy packages for avoiding the
materialisation of systemic risk.
In addition, the Japanese finance ministry would issue
30-year Japan government bonds (J.G.B.) with an offering
amount about 600 billion yen. The issue date for the bonds is
October 24 and the maturity date is September 20, 2038.
At the recent meeting of the G-7 finance ministers and
the central banks governors, Japan had agreed to take decisive
action and use all available tools for stabilising the
financial markets and adopt plan of action consisting of five
items, the statement said.
According to Nakagawa, necessary measures would be taken
promptly, including relaxing the restrictions on corporations'
purchase of own stocks, from the standpoint of stabilising the
markets.

Further, the Japanese government said it would expedite
the implementation of measures regarding disclosure of
information about short selling at the exchanges.
Temporary suspension of the sale of public sector-owned
stocks would be considered and implemented. In addition,
Nakagawa requested the Bank of Japan to take similar measures
with respect to the stock it owns.
Besides, consideration would be given to expedite smooth
financing of small and medium-sized enterprises (S.M.E.s) by
regional financial institutions through the best use of Act on
special measures for strengthening financial functions.
In addition, the minister stated that the government
would extend support for the safety net with regard to life
insurance companies, which is in place to protect the interest
of insurance policyholders, even after the current deadline of
March 31.
The finance ministry would remain flexible to consider
any additional measures in order to respond to further
developments of the situation in a timely and appropriate
manner. PTI AKH