Press Release: Statement by IMF Managing Director Rodrigo de Rato at the Conclusion of his Visit to Japan

August 3, 2006

Press Release No. 06/176

Mr. Rodrigo de Rato, Managing Director of the International Monetary Fund (IMF), issued the following statement today in Tokyo:

"I am pleased to have had the opportunity to visit Japan again. I had the privilege of meeting with Prime Minister Koizumi. I also had productive meetings with Finance Minister Tanigaki, Bank of Japan Governor Fukui, and other senior officials and representatives of the academic and business communities.

"I am very optimistic about Japan's economic prospects. The economy is expanding strongly, driven increasingly by domestic demand. The corporate and financial sectors have strengthened considerably as a result of far-reaching restructuring efforts. Deflation pressures are abating and the risk of a deflationary relapse has receded.

"Notwithstanding the prospect of above-potential growth for the near term, major policy challenges remain. In particular, there is a need to pursue further fiscal consolidation and undertake additional reforms in a variety of areas to boost Japan's economic potential and cope with population ageing. The current favorable economic situation provides a good environment for moving forward on these fronts.

"During my visit, I also exchanged views with the Japanese authorities on the IMF's Medium-Term Strategy, which aims at positioning the Fund to help countries take the opportunities—and meet the challenges—of 21st century globalization. We discussed how best to address critical issues such as ensuring fair voice for all members and quotas that reflect the evolving weight of countries in the global economy. The valuable dialogue I have just had with the Japanese authorities will help the IMF to implement the Medium-Term Strategy, and will also aid preparations for the forthcoming Annual Meetings in Singapore in September."


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