Beijing: Japan's Finance Minister yesterday said he told Chinese Premier Wen Jiabao he expects China to make a wise decision about its yuan currency amid international pressure for China to let it strengthen.
"The issue of the yuan, currencies and excess liquidity are related to each other. I told him that," Naoto Kan, who is also deputy prime minister, told reporters after meeting Wen in Beijing yesterday. "But I did not tell him what to do."
Kan also said he warned Wen about the impact of an asset bubble on the economy, following on from Japan's own experience with a property bubble in the 1980s.
China has come under pressure from some Group of Seven rich nations to revalue its currency, which critics say it keeps artificially low, giving it an unfair export advantage and hindering more balanced economic growth.
But Wen said arguments on the issue should not be made in a one-sided manner, Kan told reporters.
"He told me that there are various relations with regard to trade, such as Japan-China, US-China and EU-China, so things should not be said unilaterally," he added.
No major problems
"Generally speaking I think that's right. With regard to Japan-China trade, Japan has no major problems... but relations vary with other countries, so I told him that I expect China to make a wise decision."
Saturday's meeting between Kan and Wen was held ahead of regular bilateral talks between finance officials from both sides, the third in a series, aimed at deepening financial dialogue between Asia's two economic giants.
Speaking at a news conference after the financial talks, Kan said the two sides did not discuss the yuan further.
Instead, they agreed to support further development of their "strategically reciprocal relations", he said. They also agreed to meet again in Tokyo next year.
