TOKYO (Reuters) – Japanese Finance Minister Taro Aso said on Monday he and U.S. Treasury Secretary Janet Yellen agreed in phone talks that the highest priority was to get their economies out of the current crisis through bold fiscal measures.
Speaking after his first talks with Yellen since she became the new U.S. Treasury Secretary, Aso said they had also agreed that it was important to hold close discussions on foreign exchange rates.
“We reaffirmed that it’s important to maintain G7 (Group of Seven) as well as G20 (Group of 20) agreements of up until now,” Aso told reporters after the talks, which came as both countries continue their battle to cushion the economic blow from the COVID-19 pandemic.
Yellen underscored the importance of the U.S.-Japan alliance and conveyed her intention to deepen economic and financial cooperation with Japan to strengthen both economies, the U.S. Treasury Department said in a statement about the call.
“The Secretary conveyed her readiness to work closely with Japan, both bilaterally and multilaterally, to address key regional and global challenges such as the economic response to the COVID-19 pandemic and climate change,” it added.
During the call, Aso also brought up Japan’s desire to move forward with international discussions aimed at reaching a global taxation agreement, he said.
Treasury did not single out digital taxation in the context of Yellen’s meeting with Aso, but Yellen had pledged to re-engage actively in the ongoing OECD discussions on international taxation in her calls with the French and German finance ministers last week.
Aso had told parliament last month that Japan’s views on key economic topics were in line with those expressed by Yellen at her congressional testimony.
Key for Japanese policymakers is the U.S. currency policy under the Biden administration, due to Tokyo’s long history of having to jawbone investors or directly intervene in currency markets to address unwelcome yen spikes that hurt exports.
Yellen last month said the value of the dollar should be determined by markets, a break from former President Donald Trump’s desire for a weaker U.S. currency.
“The United States does not seek a weaker currency to gain competitive advantage and we should oppose attempts by other countries to do so,” she said.
(Reporting by Takaya Yamaguchi, Leika Kihara and Daniel Leussink; additional reporting by Kaori Kaneko in Tokyo and Andrea Shalal in Washington; editing by Shri Navaratnam, Larry King and Chizu Nomiyama)