TOKYO Japanese Finance Minister Taro Aso on Friday urged the United States to keep explaining to financial markets how it plans to wind back its massive monetary stimulus, noting the tapering is a good thing as it reflects an improving economy.
Ahead of his departure for the Group of 20 finance ministers' meeting in Sydney this weekend, Aso called on emerging market economies to implement necessary reforms to guard against any spillover from the U.S. tapering.
Global economic growth and ructions in emerging markets are set to take centre stage at the G20 meeting, following turmoil in emerging markets after the U.S. taper raised concerns of sharp capital outflows and weaker growth.
"It is a good thing that the United States is starting to reduce its quantitative easing as it reflects improvement in the U.S. economy," Aso told reporters after a cabinet meeting.
He noted that one impact has been a weakening of many emerging market currencies as foreign capital is withdrawn, leading to inflation pressures and funding concerns for those countries with large current account deficits.
"It is important for emerging economies to correct these things by making their own efforts," he said.
The G20 finance ministers and central bank chiefs are expected to discuss emerging market economies, fiscal policies of advanced economies and monetary policy, Aso said.
With host Australia keen to focus on growth, he said Japan would explain to its G20 peers its economic situation and efforts to spur growth in the world's third-largest economy.
"Each country must steer economic policy by considering not just its own situation but also others," Aso said. "We must do things in accordance with international cooperation."
(Reporting by Tetsushi Kajimoto; Editing by Dominic Lau and John Mair)