08/04/1998 14:39:18 Summers-Japan success crucial for world economy
MILWAUKEE, Aug 4 (Reuters) - Japan's success in solving its
economic problems is crucial for the rest of the world economy,
Deputy Treasury Secretary Lawrence Summers said on Tuesday.
Summers, speaking to the National Governors' Association,
also said Russia's economic problems had the potential to
affect other countries. China recognized the need to hold the
yuan currency stable, he added.
Treasury released a text of Summers' comments in advance.
"Japan's actions to fix its problems and to get its economy
growing are crucial to the future to the world economy,"
Summers said. "Japan, the world's second largest economy, has
been mired in recession for seven years and faces banking
problems several times larger than our own savings and loan
crisis in the early 1980s."
Summers said a stable Chinese currency was critical to the
maintenance of economic stability across Asia, but stressed
that the Chinese authorities were aware of that.
"The Chinese have recognized that their continued
commitment to addressing their financial sector problems and to
maintaining a stable currency will be critical to the stability
of Asia," he said.
He added: "In Russia, continuing structural problems have
been exacerbated by contagion effects from Asia... Russia's
trouble, in turn, has the potential to become central Europe's
and the world's."
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