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Media Briefing by the Japanese Assistant Press Secretary
International Media Centre, Savannah, June 9, 2004, 16h45

ASSISTANT PRESS SECRETARY: What I would like to do is to give you a brief outline of the Prime Minister Koizumi's bilateral meeting with King Abdullah of Jordan this morning, and then what the Prime Minister said in the morning session about the macro economy. And I think I will be able to give a brief explanation as to what transpired, what was discussed between Prime Minister Koizumi and President-designate Yawar of Iraq and President Karzai of Afghanistan immediately before the working lunch started at 12:00 noon.

The Prime Minister's meeting with King Abdullah started from 8:30 a.m. for about 30 minutes. In the bilateral context, Prime Minister expressed his appreciation for the various cooperation that Japan has been getting from Jordan, especially in relation to the reconstruction assistance in Iraq. And he also noted that this year is the 50 th anniversary of the establishment of diplomatic relations between Japan and Jordan. And he expressed the hope that further cooperation would take place between the two countries.

King Abdullah made the following remarks in reply:

Japan 's role in the Middle East, including one on Iraq, is highly appreciated in the Middle East, and Jordan would like to continue to extend its cooperation. Jordan also appreciates Japan 's assistance to Jordan so far, and right now there are various consultations going on between the two countries relating to education, health care, assistance to Palestine and also such issue as the United Nations trust fund for Iraq.

Jordan, on its part, is intending to carry out various reforms, and it would like to turn itself as a model in the Middle East. And the next the upcoming several years will be a critically important period for Jordan, and he looks to Japan to continue its assistance to Jordan.

The remaining issue was Iraq, and much time was devoted on this topic. The Prime Minister Koizumi said that the unanimous adoption of the Security Council Resolution on Iraq was an indication of the spirit of international cooperation, and he would like the Iraqi people to demonstrate their willingness to build, reconstruct their own nation to the international community.

It will be important to overcome the sectional differences relating to religious schools, and the international community, on its part, would like to assist the Iraqi people in establishing a stable government. And for that purpose, Iraq continues to need assistance from the international community, and Japan would like to do its part.

Japan would like to cooperate with the countries in the Arab world to provide assistance to Iraq.

The situation, the security situation in Iraq continues to be rather tight. And we haven't yet come to a stage where Japanese government officials and business people in the private sector can freely go in and cooperate with Iraq. But in the meantime, the SDF are dispatched and engage themselves in humanitarian and reconstruction assistance. Those Iraqi people in the leading positions in Iraq, including the governing council, and also the religious leaders, have expressed a high evaluation of the activities of the Self Defense Forces in Iraq, and he also emphasized that Japan's SDF will not engage in security operations in Iraq.

And as this is so, it's all the more necessary for Japan to enjoy the full-fledged cooperation from various countries concerned, including Jordan.

King Abdullah replied that if there is anything that Jordan can do as a friend of Japan to Japan's assistance, Japan 's activities in Iraq, Jordan would be glad to do so. Jordan would also like to continue its cooperation with Japan on the question of Palestine.

Japan 's role in the region is regarded as one that is neutral and fair, and for this reason, it is highly appreciated. He looks to Japan to provide further assistance and cooperation in the political process to push the roadmap forward.

And the Prime Minister replied, as he was finishing the conversation, that Japan would like to cooperate for the question of Palestine in accordance with the roadmap.

In the morning session of the summit as such, there was a discussion about the economy and trade. And perhaps I had better limit myself to what Prime Minister Koizumi said in this session; and was named as a lead speaker in this segment.

The Prime Minister started by expressing his condolences for the demise of the former President Reagan, and he referred to the great contributions that the former President made for the peace and stability in the world.

Then he made the following remarks:

The world economy is now facing a brighter prospect. At the timing when the resolution was adopted on Iraq, as a result of the steady reform efforts among the G8, the prospect for the world economic growth is now 4 percent about 4 percent for this year. For Japan, the United States is the number one trading partner, and China ranks as the second trading partner, and we witness extensive investment in the Chinese economy. And he regarded China not as a threat, but as a chance, a good opportunity.

On the occasion of the Global Forum, Prime Minister expressed the view that China should not be taken as a threat and should be taken as a chance. In those days, Japan was flooded with cheap goods from China, but as he predicted on the occasion that China has had a positive impact on the Japanese economy and is making a positive impact on the world economy as a whole.

The economy recovered in Japan last year and the stock price rose from below 8.000 yen to the level above 11,000 yen. And for the non-performing loan issue, or bad performing bad loan issue, there was a rumor that as long as Prime Minister Koizumi was in power, that Japan would not make headway in this. And also, he was criticized that if the government takes the initiative as indicated, as dictated by Prime Minister Koizumi, then Japan would suffer from increasing non-performing loans.

But, in fact, the non-performing loans are decreasing, and the Japanese economy grew at a pace which was beyond the economic forecast, and investment is also growing.

Then he went on to say that he would like to mention the four points. The IMF forecast for the economic growth of Japan for this year is now 3.4 percent, and in Japan, in the first quarter the economic growth was 1.5 percent, which stands at an annualized rate of 6.1 percent.

While he was saying there will be no economic growth without reform, he was retorted by some quarters that there would be no reform without economic growth. But nowadays, he no longer sees these criticisms leveled against him.

In order to promote the WTO negotiations, Japan would like to make its own contribution while giving due consideration to developing economies. At the same time, he would like to see various contributions to be made from the developing countries.

On the price of oil, now it is $40 per barrel. On the occasion of the Rambouillet Summit 30 years ago, which was held immediately after he was elected as a member of the Japanese Diet, the summit turned into what should be properly termed as an oil summit. And the oil, which stood at the price of $2.00, then increased, shot up to more than $10.00 in 1973. And Japan still relies on the exported oil for more than 90 percent of its demand. And there was a very extensive discussion which took place at the Rambouillet how to deal with the oil crisis.

Since then, Japan has promoted the alternative sources of energy, and it was at the time when $1 was 230 yen to 250 yen to $1, whereas right not it is about 110 yen to $1. And Japan 's reliance on oil has decreased by half; so the Japanese economy by half.

Prime Minister Taksin of Thailand actually approached Prime Minister Koizumi before he came over to Sea Island, and Prime Minister Taksin asked Mr. Koizumi to raise the issue of impact of the sharp rise of oil crisis on the non-oil-producing countries, non-oil-producing developing countries. And it is in this context that he would like to seek special consideration from the G8 leaders at Sea Island.

He also appreciated the OPEC decision to increase its oil production.

The main topic on the occasion of the first G8 summit meeting in Rambouillet was the instability of international economy. And now we are in the midst of the 30 th G8 summit and the G8 Summit wholeheartedly welcomes the adoption of the Security Council Resolution on Iraq, and as an indication that the international community tackles with this issue in unity, and he would see this united stand of the G8 on dealing with this main topic of the day.

In relation to what Prime Minister Koizumi as I outlined to you, there was one I understand that there was one leader who said that he highly appreciated the structural reform efforts that have been underway in Japan, and he would like to learn from this successful example. I also understand that a number of summit leaders referred to the price of oil.

Before taking questions, I just would like to briefly mention the conversation between Prime Minister Koizumi and Iraqi President Yawar and also Afghani President Karzai. President Bush introduced President Yawar to Prime Minister Koizumi, and then the three stood side by side and then there was some discussion.

The two Presidents appreciated Japan 's assistance, and Prime Minister Koizumi said that it's important for the Iraqi people also for the people in Afghanistan to show, demonstrate their own willingness and intention to reconstruct their countries.

President Karzai said that recently he visited Kandahar and he was impressed with the road construction that was underway with the help from Japan. And from President Yawar, in Iraq, the SDF was that's Self Defense Forces was welcomed, and he replied Prime Minister Koizumi said that when the Iraqi leaders, like members of the governing council and the religious leaders visited Japan, he heard these words of appreciation from these leaders.

And President Yawar said that it's not only the members of the governing council, but the whole nation of Iraq is appreciative of Japan 's assistance. And then it went to the outreach as such.

I'm happy to take your questions. Please.

Q Could I just ask about the Iraq debt, what has been discussed thus far about reducing Iraq 's debt which Japan holds

ASSISTANT PRESS SECRETARY: In the summit process as such, I understand that this debt issue hasn't come up yet. But it may come up as we move along, because we have some portions left. Japan 's position on this actually dates back to U.S. Special Envoy James Baker's visit to Japan at the end of last year.

On that occasion, the Prime Minister met Mr. Baker, and he mentioned that Japan was prepared to substantially reduce the Iraqi debt in consultation with the countries concerned.

To be more specific, Japan would be prepared to eliminate the vast majority of its Iraqi debt if the other members of the Paris Club would be prepared to do the same. And since then, the discussion has been going on in the forum of this Paris Club, and Japan 's position remains the same. So if there is a collective willingness to carry out the debt reduction, then Japan would be ready Japan can and could be flexible as to the specific amount, the ratio of that debt reduction.

Q I want to do some catch-up, because yesterday's briefing was cancelled. During Prime Minister's bilateral talk with President Bush, did the two leaders say anything about the issue of Taiwan or China v. Taiwan or things like that?

ASSISTANT PRESS SECRETARY: Before I answer your question, you mentioned that the briefing was cancelled yesterday. Was it by me?

Q I think you adjourned the second briefing at 9:00 p.m. Evening.

ASSISTANT PRESS SECRETARY: Actually, it was done. I mean, there was a briefing, but we needed to wait for some people to come in. So I adjourned it once, but then excuse me but I would be happy to answer any questions that you may have.

On this specific topic, the issue of Taiwan did not come up in Prime Minister Koizumi's talk with President Bush.

Any more questions?

Q On debt reduction, you mean that didn't come up in the afternoon, or are you just referring up to the end of the morning session?

ASSISTANT PRESS SECRETARY: Up to the end of the morning session, I understand that there was no discussion as such on Iraqi debt issue.

Q I believe there was they were talking about discussing it was expected to be discussed this afternoon.

ASSISTANT PRESS SECRETARY: Well, it may or it may not. I mean we can't foresee what the leaders will say. The evening dinner will be devoted to regional issues. So perhaps it may, but it may not.

Q If I could ask one more question. Was there any other response to the Prime Minister's discussion of Japan 's economic health from the other leaders?

ASSISTANT PRESS SECRETARY: Well, I understand that the number of leaders referred to the recovery of the world economy, and then there was a discussion about their own economy. But to answer your question, there was no other reference from other leaders on the spot to Japan's state of the economy.

Okay? Please.

Q Thanks. I understand that during the Prime Minister talked with President Bush, he mentioned Japan 's wish to be a permanent member of U.N. Security Council. So how active is Japan pursuing this goal, and did he mention the same issue during his talk with other leaders?

ASSISTANT PRESS SECRETARY: The reform of the United Nations system and, to be more specific, the reform of the Security Council by possibly expanding the membership, the number of members in the Council, is a longstanding argument, and Japan has been advocating for an expansion of the Security Council by increasing the number of permanent seats as well as non-permanent seats for many years now. So it's not, in that sense, something new.

Also, Japan 's financial contribution to the United Nations is very large, second only to the United States. So we believe that with so much amount of taxpayers' money being poured into the United Nations system, we would like to see more efficient workings of the U.N. bodies.

Up to now, it was British Prime Minister Tony Blair and French President Jacques Chirac and the Jordanian King that Prime Minister met in a substantial bilateral discussion. And in none of these meetings was this issue of United Nations reform mentioned in these meetings.

Okay. Thank you very much.

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