Tokyo, Beijing to act jointly on IMF issues

BEIJING - Reuters

Wang Qishan, deputy prime minister of China, and Japan Finance Minister Jun Azumi (not in picture) have agreed to jointly respond to funding requests from the IMF. REUTERS photo

Japan and China agreed yesterday that they will jointly respond to any funding request from the International Monetary Fund (IMF), which is looking to more than double the size of its war chest to help countries deal with the eurozone crisis.

Japanese Finance Minister Jun Azumi, after meetings with Chinese Vice Premier Wang Qishan and Finance Minister Xie Xuren, said the two countries were ready to support the IMF but further efforts by euro zone members were necessary.

“What we agreed on...is that European countries need to do more, although (the situation), including Greece, is headed in a good direction,” Azumi told reporters in Beijing.

“We can expect some sort of request from the IMF to those including the United States, Japan and China. We agreed that Japan and China will coordinate closely and will jointly respond to IMF.”
The IMF is seeking to raise $600 billion in new resources to help deal with the eurozone debt crisis but countries outside of the 17-country euro bloc want to see its members stump up more money before they commit additional resources to the IMF.

The Japanese minister said the two sides did not discuss the specific size of any funding support for the IMF although a Japanese finance ministry official said Tokyo was willing to commit a “sizeable” amount.

“The idea is Japan and China will coordinate, not compete, on any IMF action,” the official said, adding that both countries were fully aware of their importance in dealing with the crisis.

China ready to move

China, which has been consistently reluctant to make firm financial commitments, is seen as having the financial firepower to bail out some European governments given its $3.2 trillion worth foreign exchange reserves at hand.

Earlier in the month, Chinese Premier Wen Jiabao said the world’s No. 2 economy is considering increasing its participation in the European rescue funds and is still studying how it might go about doing it, including possibly through the IMF.