Japan Minister Leaves Us To Face Problems At Home

In his last big job as a finance minister after Prime Minister Ryutaro Hashimoto dissolved the parliament on Friday, Kubo vigorously attended many events during the annual meeting of the International Monetary Fund (IMF) and World Bank.

On Saturday he met with Group of Seven (G7) finance ministers and central bankers who welcomed the recent moves in the foreign exchange market and agreed on the importance of cutting fiscal deficits.

Kubo also talked with US treasury secretary Robert Rubin and acting US trade representative Charlene Barshefsky individually about economic and trade issues, especially the bilateral insurance dispute.

Kubo and Rubin reaffirmed their commitment to keep close cooperative ties in the foreign exchange market.

 

With Barshefsky, Kubo agreed to settle the row over how to deregulate Japan's insurance market by December 15. He even managed to fly to New York on Monday to make his first speech to a public audience overseas and read a speech to the annual IMF/World Bank meeting himself, the first Japanese finance minister to do so in four years.

But once back home, Kubo must take on the difficult task of cutting Japan's budget deficit while strengthening its fledgling economic recovery. Japanese cabinet ministers had already decided to implement the planned consumption tax hike to 5 per cent from the current 3 per cent in April 1997 to make up for previous tax cuts.

But election-related pressure is growing for a freeze or some other steps to lighten the burden for consumers.