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Sunday, Oct. 14, 2012
No marching orders in global 'talking shop'
By JUN HONGO
The main events of the annual IMF and World Bank meetings came to a close Saturday in Tokyo, with mixed reviews of the achievements and progress made.
One of the success stories for Japan was the Sendai Dialogue held Tuesday and Wednesday, through which the government shared the lessons of the Great East Japan Earthquake and proposed that both the International Monetary Fund and the World Bank join Tokyo in spreading disaster prevention measures around the world.
"Many nations suffer tragedies and rebound. Great nations like Japan take tragedy and share the lessons learned with others," Word Bank President Jim Yong Kim said in a speech Thursday.
The IMF's managing director, Christine Lagarde, also touched on her visit to Sendai during the meetings. Referring to victims of the March 2011 earthquake and tsunami who have recovered since the disasters, Lagarde said IMF member nations must also unite and work together to overcome uncertainties surrounding the global economy.
"It is laudable that aiding disaster prevention in developing countries was discussed, especially among finance ministers" who have the power to provide the necessary funding for such projects, said Takumo Yamada, advocacy manager of Oxfam Japan.
Yamada also welcomed comments by Lagarde endorsing the European Union's proposed financial transaction tax, which should prevent the gap between the rich and poor from widening.
But he noted that the meetings failed to reach expectations in certain areas, including mapping out measures to bring the eurozone's long-running debt crisis to an end and to tackle the rising cost of food in many parts of the world.
While the annual meetings began with the IMF downgrading its economic growth projections for the current year and 2013, they failed to deliver a palpable resolution that would support a global economic recovery, Yamada noted.
"These are serious issues, especially in developing countries, but a sense of urgency was lacking in the annual meetings. They felt more like a talking shop," he said.
While successfully organizing an event that drew more than 20,000 people to the capital, the government also came up short in pushing some parts of its agenda.
On Thursday, just as the Group of Seven finance ministers and central bank chiefs were preparing to meet, Bank of Japan Gov. Masaaki Shirakawa told reporters that the country is ready to "contribute to (the sound) management of the global economy."
But a Finance Ministry official revealed that the G-7 members didn't come up with any new measures or joint initiatives to stabilize the troubled global economy.
"It didn't turn into a meeting about reaching a joint understanding" on a solution to stabilize the world economy, the official acknowledged.
Finance Minister Koriki Jojima had expressed hope of taking the opportunity of hosting the G-7 gathering to explain the need to curb the soaring yen, but the issue failed to become a major topic of conversation among the participants.
Meanwhile, the absence of senior Chinese leaders from the annual meetings also left a sour taste. Though it is regarded as the engine for global economic growth while Europe's debt woes continue, China's central bank chief and finance minister were a no-show in Tokyo amid soaring bilateral tensions over the Senkaku Islands rift.
Lagarde said China had "lost out" by sending low-ranking representatives to the meetings instead of its top officials. Beijing's envoys were also absent from some meetings they had been expected to play a key role in, including a conference Thursday on Myanmar's democratization and development that was attended by 26 countries, including all of the G-7 member states.
"China lacks common sense for pulling out of the meetings," Hideaki Kase, a political analyst and coauthor of "Kokomade Chigau Nihon to Chugoku" ("This is How Different Japan and China Are"), told The Japan Times.
Beijing's decision, clearly aimed as retaliation against Japan's purchase and nationalization of the disputed Senkakus in mid-September, will certainly backfire, Kase said.
"The act of not attending an international conference of this magnitude only deepens distrust of China among other countries," especially as it is the second-largest economy in the world, he said. In addition, "fixing the relationship between Japan and China has become (more) difficult."
As for the IMF, it failed to accomplish the key goal of reforming its governance in time for the Tokyo meetings.
Lagarde said the multilateral lender's internal reforms are "at the finishing line," but it failed to seal the deal in shifting more power to emerging countries such as China.
"The process is considerably behind schedule," Oxfam Japan's Yamada said. "This is an issue that brings into question the very legitimacy of the IMF, and it needs to be addressed as soon as possible."