Prime Minister of Japan and His Cabinet  
Speeches and Statements by Prime Minister TOP

Press Conference by Prime Minister Taro Aso
Following His Visit to the People's Republic of China

October 25, 2008
(Provisional Translation)

Photograph of the Prime Minister Holding a Press Conference

Note: The opening statement and answers by Prime Minister Aso are simultaneous interpretation, and such may vary slightly from the phrasing used in the original language.

MODERATOR: Now ladies and gentlemen we would like to begin the press conference given by Mr. Taro Aso, Prime Minister of Japan. At the outset, Prime Minister Aso will deliver some opening remarks before taking questions.

PRIME MINISTER TARO ASO: Ladies and gentlemen of the press, I have just come from the Seventh Asia-Europe Meeting (ASEM 7). It has been a well organized meeting, and I am sure that the Ministry of Foreign Affairs of the People's Republic of China and others concerned have made great efforts to ensure this. This meeting comes just after the Beijing Olympics, and I was quite impressed that they have been able to organize the conference very well, and I would like to express my respect as well as gratitude for that. This is the thirtieth anniversary of the Conclusion of the Treaty of Peace and@Friendship@between Japan and People's Republic of China, and I believe various people have made a lot of effort in this regard also, so once again my gratitude to all those concerned.

This time leaders from 43 countries from Asia and Europe gathered, such as Presidents and Sultans, and I had the opportunity to exchange views with 37 leaders. Needless to say, the main theme for our discussions was the current international financial situation and its possible impacts on our economies. We also took up climate change including environmental issues, and we discussed regional issues such as the North Korean issues and the situation in Afghanistan. We had a lot of lively discussions on these subject matters.

Separately there were also ASEAN+3 meetings, as well as bilateral meetings with the leaders of China, the Republic of Korea, Germany, France, and numerous other countries as well.

As for ASEM, as I just stated, the main item on the agenda was the international financial situation, or in other words the international settlement system. We had in-depth discussions on the possible impact of these problems on the real economies of Asia and Europe. I stressed the importance of the G7 plan of action which was announced recently, the role of international financial institutions such as the International Monetary Fund (IMF), and also the importance of regional cooperation and the strengthening of regional cooperation in Asia, and these were all agreed by others.

As Asian countries including Japan experienced financial crisis in 1997,,I think we were able to come up with the stance that all countries concerned will act in concert in addressing this problem.

With President Hu Jintao of China I agreed that we shall cooperate with each other on various international efforts in the days ahead, including at the Summit Meeting that will be held next month in Washington D.C.

On regional affairs, I stressed the importance of resolving the North Korean nuclear issue as well as the abduction issue, and I am grateful for the understanding shown by other countries. The main issues are Iran in the case of Europe, and North Korea in the case of Asia, and of course it is only natural that there should be regionality in our major issues. From European side, the issue of Iran was raised. I expressed that Japan shall continue to actively participate in Afghan reconstruction assistance as well as in the fight against terrorism.

On climate change I called for the building of a framework in which all major emitting countries will participate, and for the use of the sectoral approach on the basis of targets for different sectors of industry, and I also called for cooperation with developing countries.

On the subject of Japan-China relations, this was my very first visit to China as Prime Minister of Japan. Of course I have visited this country before as a different post such as the Minister for Internal Affairs and Communications, but during this visit I have had bilateral meetings with President Hu Jintao as well as Premier Wen Jiabao, and confirmed that we shall promote further the Mutually Beneficial Relationship Based on Common Strategic Interests. We also agreed that we should build a relationship of mutual trust to the extent that we will be able to pick up the phone whenever something comes up.

I together with President Hu Jintao attended the commemorative events for the thirtieth anniversary since the signing of the Treaty of Peace and Friendship between Japan and the People's Republic of China. I expressed my personal conviction regarding Japan-China relations, and we celebrated together this memorable landmark.

I also had a very useful meeting with President Lee Myung-bak of the Republic of Korea. On the North Korean issue we mutually confirmed that we shall further engage in close bilateral coordination between Japan and the Republic of Korea, and also in trilateral coordination between Japan, the United States and the Republic of Korea.

Finally, I would like to express my deep gratitude to the Government of China, the people of China, and also to the citizens of Beijing for their very warm welcome and hospitality. I am sure the citizens of Beijing must have been inconvenienced by traffic controls and so on.

MODERATOR: We would now like to entertain questions from the floor. If you are recognized, please state your affiliation and your name before asking your question. First a question from the Japanese press. Please.

QUESTION: As the impact of the financial crisis on the world economy is becoming increasingly serious, at this ASEM Summit Meeting were you able to issue an effective message to deal with the crisis? On this point, what is your view with respect to Japan's role? Also, on November 15 in Washington D.C. there will be an emergency financial summit held; how are you going to capitalize on the results of this meeting for that Summit Meeting?

PRIME MINISTER TARO ASO: On whether we were able to come out with a clear message, 45 countries or so participated in the Summit Meeting this time, and of course the impact on countries differs from country to country-Europeans I believe are suffering more, and compared to that, I believe that Asian countries, perhaps because of their experience of the currency crisis in 1997, are not being affected as much as European countries so far. Still I believe that the leaders of Asia and Europe have together expressed deep concerns about the financial crisis and therefore have come up with a clear message in the form of the Statement of the Seventh Asia-Europe Meeting on the International Financial Situation.

As for what Japan's role has been, perhaps you remember that back in 1997-1998, Sanyo Securities, Yamaichi Securities, and Hokkaido Takushoku Bank, and the next year the Long-Term Credit Bank of Japan, all these financial institutions went bankrupt one after another, and before that there were also the housing loan institutions problems. How did we resolve these? We have the experience of overcoming that sort of crisis. At that time, Japan alone worked out these problems, but this time there is awareness that there is a need for coordination among all countries concerned because of the spread of the crisis.

In order to resolve the crisis, the countries concerned need to properly work out their measures to revive business activity and economy, and they cannot really overcome it by depending on external demand. With that in mind, each country needs to work on domestic demand expansion in the interest of improving their domestic economic situation. Unlike back in 1997, we believe that this time we must recognize the role of the IMF, and try to make full use of the IMF's functions. I believe that is reflected in the Statement of the Seventh Asia-Europe Meeting on the International Financial Situation.

I think that because Japan has far greater experience of financial crisis, in my bilateral discussions with China, the ROK, France, Germany and Italy we agreed that we shall keep consulting with each other closely in the run up to the Summit Meeting in the United States. We do not simply express our views at one time but we need to properly exchange views with each other, because we are faced with an unprecedented situation and we have never really faced a crisis of this scale, not since the 1920s, if I may cite what Mr. Alan Greenspan said.

We need to devise a proper response to the current crisis. Although I thought that we may not really be able to come up with a consensus, I think that we have been able to come up with a single voice as everyone shares this awareness that the financial crisis is very serious.

MODERATOR: Thank you very much. Next we would like to invite a question from the Chinese press please. The lady there please.

QUESTION: Good afternoon Prime Minister Aso, I welcome you to China. I am a reporter for the Chinese Internet media. In China many young people use the Internet, so do you have any message for these young Chinese people, Prime Minister? This year is the year for friendship and exchange between the youth of China and Japan. In Sino-Japanese relations what role do you think the youth should play.

PRIME MINISTER TARO ASO: Those who will build the future of China are the young. Those who will build the future of Japan are also the young. Those who will build the future of the world are the young. That is how I see it. My son and daughter are among the youth of Japan, and I have confidence in the abilities of the young. In all times people speak badly of the young people of the time. Even in the Egyptian pyramids there is, I understand, the expression "the young these days are no good." People have been saying the same thing ever since five millennia ago. But it is always the young that have reformed the status quo and created the new future. Of course there may be different definitions of youth, but at least it has always been the young who have done this, so I believe it is the young who will build and create the future.

You referred to the Japan-China Youth Friendship Exchange Year. I believe that about 3,300 youths will be visiting each other this year. I very much hope that these young people from China will experience the real Japan, and that the young Japanese will experience the real China. I think that that is the best thing to do. I agreed with President Hu Jintao to further promote this program, because he is very much interested in this. I believe that around 1985 he led a group of young Chinese to Japan, and the year before I believe that the first round of about 3,000 young people visited China. This is a subject that I discussed with President Hu Jintao as well, and he agreed that this is something that we should by all means promote further in the future, so we shall indeed be doing that.

MODERATOR: Once again, I would like to invite a question from the Japanese press. Please.

QUESTION: Regarding the dissolution of the House of Representatives, the Lower House, and a general election, you said that this was a time for politics, not a time for politicking. Against the background of the financial crisis and the volatility of the stock market, what is your judgment now with respect to your strategies in the Diet. The opposition parties are now responding to the situation on the assumption that there is going to be a snap election soon, but if that is delayed then they may change their strategy, and this may cause difficulties in the deliberations and discussion. What do you think about this?

PRIME MINISTER TARO ASO: That goes without saying that the timing of the dissolution of the Lower House and general elections is something that I need to decide by taking into consideration numerous factors. Now, as I mentioned a while ago, to cite the words of Mr. Alan Greenspan, "This is a once in a century international economic crisis." This is an important point. In the case of Japan, compared to the United States and Europe, so far we are not hurting that much, but for the past at least eight years or so we have depended only on external demand and export, and clearly these are not going to grow, which means that we have to take measures to revive business activity and create domestic demand. That is to say, we need to attach a greater priority to the international role rather than domestic politicking, as I listened to the voices of various leaders yesterday and today.

You referred to the impact on parliamentary deliberations. When you are in the Nagatacho area in Tokyo I understand that sort of awareness, and of course that is an important point that I have to take into consideration, but as I said, I really need to take into consideration numerous factors, and therefore I have not decided at this time whether to dissolve or not to dissolve the Diet, so I cannot say any more.

MODERATOR: We are approaching the time to end the press conference, so this is going to be the last question. From the international press, please. Yes, the lady over there.

QUESTION: Following up on the first question, financial markets are beginning to expect more action plans at the financial crisis summit in November in Washington, so having gone through the experience of overcoming its own financial crisis in the 1990s what can Japan bring to the table to make the summit successful with action not just words.

PRIME MINISTER TARO ASO: I really haven't got an answer that will be the answer at the moment, but I would say that on the basis of the plan of action that the G7 came up with recently major countries are now taking firm actions. In Japan as well we are putting into place the necessary measures, such as securing liquidity of the Bank of Japan, the passing in the parliament of a supplementary budget, and also next week we will be putting together a new economic package. But the important thing is that at the summit we should not simply discuss immediate measures to overcome the financial crisis like the current stock market situation, but we also need to discuss medium to longer-term vision among leaders a little bit more, such as matters related to the international settlement system.

New types of financial instrument such as derivatives developed by the financial sector were not fully supervised or monitored by rating agencies and governments, and it is also suspected that these new financial instruments lacked transparency. So, as you know, people are learning lessons about that. Widely differing views are heard about such instruments, as you are quite aware. So how are we to best deal with this kind of problem? I believe that various countries have disparate views on that. Some suggest that there should be stronger regulation. Others would say that stronger regulation would impede free imagination or various innovations. But the problem is that damage has been done, and some people feel that they have been taken for a ride, especially those who experienced exchange losses and so on, and they are not quite convinced by the sufficiency of the regulations. They feel there are problems with the supervision.

These financial instruments flow around the world, but the supervisory authorities are country by country, and if instruments flow beyond borders then they are beyond the control of a single country authority, so there are numerous problems that need to be discussed, as I see it. I think the countries will come up with their ideas by mid-November, and Japan shall actively work on these ideas. Of course, for now we need to overcome the immediate crisis, and then we also have to come up with a proper vision for the medium and longer term, so I think it should be a two-tier process.

MODERATOR: Thank you very much.

We have come to the time to conclude this press conference by Prime Minister Aso. Thank you very much for your cooperation.