Finance chief's debut low-key - The Japan Times

MARSEILLE, France — For Japan, the Group of Seven financial meeting that just ended was an important opportunity to raise concerns about the yen's recent appreciation and seek the understanding of other industrial powers for additional interventions by Tokyo in the currency market.

New Finance Minister Jun Azumi appears to have made a smooth — albeit low-key — diplomatic debut, fulfilling his pledge to make the nation's case to its G-7 partners.

Before he took office when Prime Minister Yoshihiko Noda created his new Cabinet earlier this month, Azumi was little known in the financial markets.

Considered a novice in global finance, some economists even pointed to the possibility of macroeconomic slipups because of his lack of experience in the field.

During the half-day meeting in Marseille, France, he explained to his G-7 peers that a strong yen could derail the otherwise robust recovery of Japan's economy following the catastrophic earthquake and tsunami in March.

Azumi also sought the understanding of the other G-7 members for Tokyo's position on currency market intervention. Nevertheless, the postconference statement did not reflect his arguments — with the wording on the currency nearly identical to the previous statement released Aug. 8.

Although Azumi said other G-7 members were sympathetic to Japan's currency stance, his remarks drew little reaction, with most participants more focused on addressing the European debt crisis and spurring global economic growth.

A U.S. official revealed that only one G-7 country — Japan — took up the currency issue during the meeting.

Following the rare move by the Swiss Central Bank to set a minimum exchange rate target against the euro, the yen could draw more buying, rising even higher as it becomes the lone safe-haven currency.

Given the size of Japan's economy, the world's third-largest, many analysts and government officials said it is unlikely Tokyo will take a similar defensive step.

Japan faces a plethora of challenges — from combatting the strong yen to restoring fiscal health while maintaining growth — and needs policy coordination with G-7 members.

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