Wednesday, January 27, 2010

Date Wednesday, January 27, 2010
Venue Washington D.C., USA
B1 Conference Center, Center for Strategic and International Studies
1800 K Street, NW Washington DC, 20006
Sponsors Japan Economic Foundation (JEF)
Center for Strategic and International Studies (CSIS)
Topics "What is Next for the U.S. and Japanese Economies?"
Panel 1: Outlook for the Japanese Economy (Audio Link to CSIS)
Panel 2: Outlook for the U.S. Economy (Audio Link to CSIS)
Panel 3: Panel Discussion: Agenda for Bilateral Cooperation (Audio Link to CSIS)
Luncheon Keynote Address: Economic Outlook and U.S.-Japan Relations (Video Link to CSIS)

ParticipantsWednesday, January 27, 2010List

SummarySummary (English)Summary (Japanese)

Chairman's SpeechOpening Remarks by Noboru Hatakeyama (January 27, 2010 @JEF-CSIS Conference in Washington D.C.)

"What is Next for the U.S. and Japanese Economies?"

Dr. John Hamre, Distinguished guests, Ladies and Gentlemen, it is my great honor to be here with you today in this important conference.

First of all, I would like to express my heartfelt gratitude to Dr. Hamre for co-organizing this conference and to all speakers and discussants and the participants for attending the conference in spite of your busy schedule.

Today, we will discuss the possible future courses of US and Japanese economies. Both economies have faced with difficulties and challenges. There are many issues to talk. For example, will our economies encounter with double dips this year? Which sector could we expect to play a leading role to stimulate and accelerate respective economic growth? Could green related technologies and health related new inventions actually substitute auto and its related industries? What sort of new business-models would help corporations to revitalize their activities? Should we be ready for a new capitalism with a change of roles of governments and private sectors to some extent?

In our national security front, our discussion may have to touch upon if a commitment made by a former government can survive a power shift. As you know well, the new Hatoyama cabinet
decided to review by May this year a commitment made by former cabinets. Obama administration also changed a policy implemented by the Bush administration regarding missile deffense system which had been deployed in Check and Poland.

Our topics won't end up at those points. We have to scrutinize the realities and cultivate possible collaborative policy areas between our two countries. For example, we have to address the real reasons for the financial crisis that was deepened by Lehman Brother's collapse in September 2008. Since then many international conferences were held, including G20 in London and Pittsburgh to come up with counter measures to prevent recurrence of financial crisis from happening. However they have never referred to possible prohibition of a securitization of sub-prime loans which was the most important reason for the financial crisis. Securitization in general would be all right but when it comes to a securitization of sub-prime loans the story would become quite different. Would there be any rooms for governments of the US and Japan to co-operate with each other to prohibit it?

Another example would be for us to take joint initiatives to keep stimulating our economies, analyzing whether economic recoveries as of now in both countries are sustainable and, if not, coming up with proposals to continue the current recoveries. In this respect, a President Obama's proposal to impose a new tax on financial institutions, including banks is quite interesting. Reportedly, the Government of Japan has been asked if it will do the same. If Japan accepts this proposal, it will become the first economic collaboration between Japan and the US under the current governments.

The Democratic Party of Japan stated in its manifest for the election for the house of representatives that it would accelerate negotiations on a Japan-US FTA. Although it would be ideal to conclude a full fledged US-Japan FTA, my proposal is to strike a .US-Japan FTA only for trade in services since I am afraid that the US Congress and Japanese diet are not supportive of such a full fledged FTA which includes both trade in goods and services.
Although the original nature of a FTA remains in the economic field, a FTA can lead to strengthened political relations between countries involved in it. Like any other FTAs, a US-Japan FTA, even if it be that only for trade in services, will contribute a lot to deepen and enhance the mutual dependence further more.

I would like to expect that the speakers and commentators today would touch upon those issues, and at the end of this dialogue, all the participants could find out the wisdoms and realistic solutions to make the economies securities of both countries more vigorous and more closely knitted.

With these comments, I would like to thank the people belonging to Center for Strategic and International Studies (CSIS), and the other participants once again for joining us today.

Thank you.

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