Japanese PM calls for fiscal reform in policy speech

15:53, June 11, 2010      

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Naoto Kan, Japan's Finance Minister addresses a press conference in Tokyo, capital of Japan, on June 3, 2010. Japan's DPJ chooses Naoto Kan as new Party President on June 4. (Xinhua Photo)Japan's Prime Minister Naoto Kan on Friday called for multilateral discussions to end the nation's unsustainable dependency on public borrowing and called for fiscal reform to tackle prolonged deflation in the country.

Speaking in his first policy address to parliament since taking office as prime minister on Tuesday, Kan pledged to work on fiscal reform, highlighting the debt crisis in the eurozone as a potential pitfall.

"We can see from the eurozone confusion that began in Greece that our finances can go bankrupt if we don't address our rising public debt," said Kan.

"We cannot sustain public finance that overly relies on issuing bonds. There is a risk of default if the growing public debt is neglected and if trust is lost in the bond market," the premier said.

Kan called for multilateral cooperation between the parties to address Japan's burgeoning debt, which is almost 200 percent of annual economic output, the largest in the industrialized world.

According to the Ministry of Finance, Japan's state debt amounted to a record 882.9 trillion yen (9.7 trillion U.S. dollars) as of March 31.

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