FINANCE MINISTERS AGREE ON NEED FOR STABILITY
Finance ministers from seven major
industrialized nations agreed on the need to stabilize
currencies at current levels but said more action was needed to
reduce trade imbalances and sustain economic growth.
    In a communique issued after a four-hour meeting at the
U.S. Treasury that ended last night, the ministers said the
value of the dollar and other currencies was basically correct
now, and they welcomed new measures planned by the Japanese to
boost their economy.
    West German Finance Minister Gerhard Stoltenberg called it
a "good meeting" and in brief remarks exchanged with reporters
other ministers seemed pleased with its outcome.
    Shortly after the communique was issued and just as foreign
exchange trading opened in Tokyo, the Bank of Japan intervened
again to prevent the yen rising too quickly.
    The communique said, "The ministers and governors reaffirmed
the commitment to the cooperative approach agreed at the recent
Paris meeting. They agreed, however, that further actions will
be essential to resist rising protectionist pressures, sustain
global economic expansion and reduce trade imbalances."
    It welcomed the plans set this week by the Japan's ruling
Liberal Democratic Party to stimulate its economy with what the
communique termed "extraordinary and urgent measures" including
an "unprecedented front-end loading of public works
expenditures."
    The meeting of the so-called Group of Seven brought
together ministers and central bank governors of the seven
major industrial democracies, the United States, Japan, West
Germany, France, Britain, Italy and Canada.
    The communique said the ministers reaffirmed the commitment
on cooperation reached in a meeting on February 22 in Paris
when they had agreed to stabilize foreign exchange rates at the
then-current levels.
    In the weeks that followed, the dollar continued to fall
against the Japanese yen despite massive dollar purchases by
the Bank of Japan and other central banks and is now trading at
around postwar lows.
    Japan has come under growing criticism from both the United
States and European countries for its only modest efforts to
open its markets to outside competition and to reduce its
exports.
    The communique said Japan affirmed its intention to open
domestic markets to foreign goods and services but did not
elaborate.
    It said the officials "reaffirmed the view that around
current levels their currencies are within ranges broadly
consistent with economic fundamentals and the basic policy
intentions outlined at the Louvre meeting."
 Reuter
