US Treasury Secretary Lawrence Summers on Friday urged Japan to continue making efforts to ensure stable economic growth, a Japanese government official said.

The Japanese economy has made progress, but Japan has yet to realize its potential growth rate, Summers said during a meeting with Japanese Prime Minister Keizo Obuchi.

Summers told Obuchi that confidence in the Japanese economy has been restored among investors, and that the country's financial system has been strengthened, the official said.

But he urged Obuchi to continue deregulation, especially in the telecommunications sector, saying it would be important to boost investment, the official said.

Summers is in Tokyo to attend Saturday's meeting of finance ministers and central bankers from the Group of Seven (G-7) major economies.

The G-7 groups Britain, Canada, France, Germany, Italy, Japan and the United States. (Xinhua)