Japan’s Hatoyama welcomes G20 regulation debate

September 4, 2009

JAPAN-ELECTION/   By Tetsushi Kajimoto
   TOKYO, Sept 4 (Reuters) – Japan’s next leader, Yukio Hatoyama said on Friday the fact that the Group of 20 finance ministers meeting in London this weekend will discuss financial regulation was a sign the world is reflecting on the excesses of market fundamentalism.
   A financial regulatory debate ahead of the Sept. 4-5 meeting has been dominated by European moves to seek consensus on limiting bank bonuses and by a U.S. push for tougher bank capital standards. [ID:nL3171976] [ID:nL113139]
   Hatoyama, who’s Democratic Party of Japan won Sunday’s national election by a landslide, stressed that financial regulation must be balanced with the need to maintain market functions. [ID:nTKU105528]
   “We can’t say regulation is better when it is uniformly strong,” Hatoyama said at an event in Tokyo for the World Economic Forum. “What’s needed is a balance between regulation by the government and markets.”
   Japan is preparing for a historic change after voters threw out the Liberal Democratic Party in the election, handing the novice DPJ the job of reviving a struggling economy and ending half a century of almost unbroken LDP rule. [ID:nPOLJP]
   The U.S.-educated Hatoyama had raised eyebrows in Washington with a recent essay in which he attacked the “unrestrained market fundamentalism” of U.S.-led globalisation. He sought to play down those comments on earlier this week in a call with U.S. President Barack Obama, saying he was not anti-American.
   No DPJ lawmakers will go to the weekend meeting of the G20 although finance ministry officials explained to senior party officials what topics would be on the agenda. [ID:nTFD006336]
   Outgoing Japanese Finance Minister Kaoru Yosano said Japan has no objection to a European push to limit bankers’ bonuses, which will also be discussed at the weekend meeting.
   European ministers are likely to push for a change in the culture of bankers’ bonuses, which some believe helped cause the excessive risk-taking by financial institutions that led to the global financial crisis. [ID:nL2567159]
   “Japan will take no exception to the issue involving bonuses,” Yosano told a news conference after a cabinet meeting.
   The U.S. Treasury Department on Thursday proposed tough international standards on capital and liquidity at banks, saying new rules are needed to reduce the risk of another global financial crisis. [ID:nN03126032]
   Yosano said the G20 must pay heed to financial sector conditions and the possible impact on broader credit conditions in each country when considering when and how to implement regulation on banks’ capital ratios.
   Yosano will skip the G20 meeting due to health reasons, and Senior Vice Finance Minister Wataru Takeshita will go in his place. Bank of Japan Governor Masaaki Shirakawa will also attend the meeting. (Additional reporting by Chisa Fujioka; Editing by Hugh Lawson) ((tetsushi.kajimoto@thomsonreuters.com; +81 3 6441-1829; Reuters Messaging: tetsushi.kajimoto.reuters.com@reuters.net)) ((If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com)) Keywords: G20/JAPAN 
Friday, 04 September 2009 08:20:19RTRS [nT319626  ] {C}ENDS

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