WASHINGTON, April 18 The following are comments
on Thursday from finance officials in Washington for the
semiannual meetings of the International Monetary Fund and World
Bank, and a meeting of Group of 20 leaders.
MEXICAN FINANCE MINISTER LUIS VIDEGARAY ON ASSET PRICE
"There is a call from the G24 members to have clear
coordination and better communication between advanced economies
and emerging markets ... towards using coordination as a way to
mitigate these potential asset appreciation bubbles. The
consensus is that this is something that has to be closely
G24 DEVELOPING, EMERGING ECONOMIES COMMUNIQUE
"We call on (advanced economies) to take into account the
negative spillover effects on (emerging markets and developing
countries) of prolonged unconventional monetary policies,
including on inflation and the volatility of capital flows and
BANK OF JAPAN GOVERNOR HARUHIKO KURODA ON WHETHER JAPAN IS
LIKELY TO DRAW CRITICISM FROM G20 NATIONS OVER ITS AGGRESSIVE
"I don't think there will be such discussion. Our so-called
quantitative and qualitative monetary easing was taken purely
for domestic policy reasons, which is to achieve price stability
and meet our 2 percent price target roughly in two years. It is
absolutely not aimed at weakening the yen.
"We've made that clear to markets and policymakers around
the world. I think we've gained broad understanding on that
KURODA ON EASING AND ASSET PRICE BUBBLES:
"In general, I don't see signs of asset price bubbles
brewing in emerging economies as a result of the monetary easing
steps of advanced nations. It's true that the massive monetary
stimulus of advanced economies may affect emerging economies
including through capital inflows ... Such spill-over effects
had been discussed even before the G20 meeting, and will likely
be on the agenda at (this week's) meeting too."
FRENCH FINANCE MINISTER PIERRE MOSCOVICI ON BANKING UNION:
"We must go as far as possible without treaty change and
consider whether ... that is necessary. But if it must be, they
must be very technical. The idea of a treaty change, which is
never popular in Europe, must not be used as a pretext to stop
"If necessary we can have one. But it has to be necessary
and technical because it's clear people are not very fond of
huge treaty changes; we've had a lot in the last years."
"We want a full banking union and we want it fast."
MOSCOVICI ON BALANCING GROWTH, FISCAL CONSOLIDATION
"It is logical that some countries like ours adopt a good
rhythm, balance between fiscal consolidation, which is a
necessity, and also sustaining growth, which is indispensable
for our people."
"We need to find the right balance, the right balance is to
say that we must sustain growth but, at the same time, that we
must absolutely reduce our deficits and reduce our debt."
EU'S OLLI REHN ON U.S., IMF URGING LESS FISCAL RESTRAINT
"They are preaching to the converted."
"In the early phase of the crisis it was essential to
restore the credibility of fiscal policy in Europe because that
was fundamentally questioned by market forces."
"There was no choice. Decisive action was taken. Now as we
have restored the credibility in the short-term, that gives us
the possibility of having a smoother path of fiscal adjustment
in the medium-term."
"I have been somewhat struck by the perception of the
economic and fiscal policy in Europe."
REHN ON JAPAN'S STIMULUS EFFORTS
"I can well understand the concern of the Japanese
government about the slow growth and deflation, that is why I
see the merit of providing economic stimulus to support growth
and to exit from the long-lasting deflation that Japan has
"However, Japan still faces the challenge of putting
together a credible long-term strategy of fiscal consolidation
-- I speak deliberately of the long-term -- and deciding on
structural reforms that will help boost sustainable growth and
"So I understand these short-term measures to stimulate the
economy and tackle deflation, but they do not yet respond to the
medium to long-term challenges that Japan faces."
THARMAN SHANMUGARATNAM, SINGAPORE DEPUTY PRIME MINISTER AND
FINANCE MINISTER, ON THE RISE OF EMERGING MARKET NATIONS:
"Let's not assume that this is now a permanent ascendance.
Moving from middle income to upper middle income and high income
is not just about macroeconomic policies. It's not an automatic
game of catch-up. It involves profound institutional changes.
Profound institutional changes in systems of governance -
economic and social. It involves systems of financial governance
as well. Profound institutional changes. What happened to create
wealthy societies in Europe and the United States and Japan
pre-war and in the immediate post-war period is still an
aberration in world history. Let's not assume that we're now in
a world where the emerging markets are on a permanent trajectory
of ascendance. The chances are that it's going to be a
multi-polar world but it rests on major institutional reforms in
the emerging economies.
BANK OF CANADA GOVERNOR MARK CARNEY ON THE FED'S GUIDANCE:
"It helps market participants understand not exactly the
timing of adjustment of interest rates but the minimum
conditions before the Fed even thinks about adjustment of
CARNEY ON EXIT FROM UNCONVENTIONAL MONETARY POLICY:
(Asked whether central banks have the necessary tools for
exit strategies from their ultra-easy policies:)
"The tools are there. It hasn't been done before so I think
there's a need for humility around it and an appropriate caution
"It can also, as appropriate, influence the continued path
of unconventional policy. If there is a prospect of an exit, if
the timing of the exit becomes more clear, it obviously
influences the path, magnitude and composition of unconventional
policy. At least those are considerations that need to be taken
into account by relevant central banks."
IMF MANAGING DIRECTOR CHRISTINE LAGARDE ON CYPRUS:
"(The) Cyprus resolution is not a template. And the way in
which the two largest banks of Cyprus and the rest of the
banking system has been restructured in the way it has, and in
the way it should have been, is not a template for other
countries, if only because the situation of Cyprus is extremely
specific for all sorts of reasons."
LAGARDE ON GLOBAL RECOVERY:
"We're also seeing the emergence of a three-speed global
recovery: those countries that are doing well, those countries
that are on the mend, and those countries that still have quite
a distance to travel."
"The three-speed recovery is not the healthiest we could
think of ... what we need is a full-speed global recovery."
LAGARDE ON U.S. FISCAL TIGHTENING:
"The U.S. managed to avoid the fiscal cliff. It still needs
however to fix the pace of its fiscal adjustment. Better
quality, less of it upfront, much more well-planned,
well-anchored, well-communicated for the future. And this would
certainly support the recovery in private demand."
LAGARDE ON ECB POLICY:
"Of all the major central banks in the world, clearly the
ECB is the one that still has room to maneuver. It will be for
them to determine when is the right time to use that space and
to potentially reduce interest rates. What in our view is more
critically important is to make sure there is fluid transmission
between central banks and banks, and amongst banks ...
"There has to be enough strengthening as well as
restructuring if need be of banks within the euro-zone regions
in particular, as well as the right influx from the top at the
right moment. That should hopefully unleash the credit that is
so much needed for SMEs and consumers to invest again."
LAGARDE ON SPAIN:
"We believe considering the situation of the country and the
efforts that had been undertaken, the 20 percent unemployment
rate at the moment, it's clearly needed to do fiscal
consolidation but we don't see the need to do upfront, heavy
duty fiscal consolidation as was initially planned. Spain needs
more time and needs to be able to adjust into its fiscal
consolidation efforts it has done already."
LAGARDE ON EURO-ZONE, JAPAN:
"On the euro area, policymakers have accomplished a great
deal over a short period of time. The priority now is to fix
frail banking systems and press ahead with banking union.
"In Japan ... the recently announced framework of ambitious
monetary easing is, from our point of view, a positive step. But
it is not enough. Japan needs more ambitious plans to bring down
debt plus structural reforms to shift the economy into a higher
gear. That's the whole plan behind this three-arrows policy mix
which the prime minister has described, and we are certainly
keen to see the other two arrows into action."