Hiroshi Nakaso: Toward innovative payment and settlement systems
Keynote speech by Mr Hiroshi Nakaso, Deputy Governor of the Bank of Japan, at the
9th Asia Banking CEO Round Table, Tokyo, 25 November 2014.
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Introduction
Thank you for your kind introduction. Distinguished guests, friends, and colleagues. It is my
great pleasure to speak at the 9th Asia Banking CEO Round Table.
Today's theme is "Operating in a New World: Digitisation and Disruptions in Banking."
Initially, I was somewhat puzzled by the word "disruptions," but soon realized that disruption
is only a prerequisite to creation. Banks can generate new value-added by discarding old
business models and embarking on innovative challenges. Now, the questions are: What is
the role of central banks in accelerating such innovation? What can we central bankers do to
help banks steer through new challenges? How can we work together with the financial
community to maximize the benefits of households and businesses? These are all very
deeply rooted in the fundamental purpose of central banking; that is, to contribute to the
sound development of the national economy.
Today, I will explain our efforts toward creating innovative payment and settlement systems.
In my view, the future payment and settlement infrastructure should offer an environment that
facilitates the smooth delivery of the Japanese yen and Japanese government bonds (JGBs)
anywhere and anytime. This is what I would call the ubiquity of the Japanese yen and JGBs.
As a guardian of the national payment and settlement systems, the Bank of Japan (BOJ) will
cooperate with bankers, market participants, and central bank colleagues overseas to make
the unprecedented a reality with ideas that are innovative if sometimes disruptive, to borrow
a word from today's main theme of the round table. Please note that the views expressed
today are mine, not necessarily those of the BOJ.
The plan of my talk is summarized on slide 1. First, I will consider where we currently stand
and what we can expect for the future. Next, I will elaborate on four major areas in which we
are exerting efforts toward better payment and settlement systems. After that, I will briefly
touch on recent developments in Japan's economy and the conduct of monetary policy under
the quantitative and qualitative monetary easing. Lastly, I will make my concluding remarks.
I. Where do we stand and what do we expect for the future?
Following the Asian currency crisis in 1997-98, the region has seen remarkable
performance. Asian economies and financial markets have been expanding at a healthy
pace. As you can see on slide 2, according to the IMF, the average GDP growth rate of
Asian emerging economies since 2000 marked 8.0 percent, whereas that of advanced
economies was merely 1.8 percent. Likewise, on slide 3, when we compare the capital
inflows into Asia and other leading economies, big gyrations in capital flow were observed
before and after the Lehman crisis. The capital flows to the euro area and the United States
changed their course from inflow to outflow. Despite this development, capital has flowed into
Asia steadily.
On the back of such performance, a number of initiatives have taken place in the region to
build a safety net, thereby raising its capacity for crisis management. These initiatives are
namely (i) the Chiang Mai Initiative (CMI), (ii) the Asian Bond Fund (ABF), and (iii) the Asian
Bond Markets Initiative (ABMI). We all know that, after the Lehman crisis, the region has
remained resilient and the safety net has effectively prevented risk from permeating it.
Let me briefly elaborate on these initiatives. The CMI is a set of international swap
arrangements in the region, having started from a network of bilateral arrangements and now
developed into a common multilateral arrangement. The Chiang Mai Initiative
Multilateralization (CMIM) is a multi-lateral currency swap contract covering all ASEAN+3
members. The objective of the CMIM is twofold: first, to address balance of payment and
short-term liquidity difficulties in the region; second, to supplement the existing international
financial arrangements. In July this year, the CMIM was amended by doubling its total size
from 120 billion to 240 billion U.S. dollars, and by introducing a precautionary line in order to
strengthen the regional safety net. As for the ABF, this concerns the enhancement of bond
markets in Asia. The Asian Bond Fund 1, often referred to as ABF-1, invested in U.S.
dollardenominated bonds issued by sovereign and quasi-sovereign borrowers in some EMEAP
(Executives' Meeting of East Asia and Pacific Central Banks) economies, while ABF-2,
launched in December 2004, invested in domestic currency bonds rather than U.S.
dollardenominated bonds. Lastly, the ABMI, started in 2003, aims to develop efficient and liquid
bond markets in Asia, so that savings in the region can be better utilized for investments in
the region. Under this initiative, the ASEAN+3 economies have set up a forum to explore the
possible establishment of cross-border securities settlement infrastructure, which I will come
back to later.
What is the objective of these initiatives? The CMIM set up the safety net in the region, while
the ABF put in place a keystone for the primary bond market and the ABMI has been aimed
at fostering regional securities settlement infrastructure. As I said, Asia is a region that has
registered the fastest growth in the world, and it continues to enjoy high growth potential. The
role of banks will become even more important down the road, as they contribute to
facilitating balanced growth in the region. There are two channels through which banks can
contribute. The first is reinforcing their lending activity in business areas with growth
potential. The second is enhancing payment services and reinforcing payment infrastructure.
In the following, I will focus on the latter role expected of banks today.
As a central bank, we need to work together with banks to ensure that they contribute to the
balanced growth of the region. I find it particularly important that central banks lay the
foundation for banks so that they can exert the utmost efforts to demonstrate their
intermediary function. I say this because we provide an infrastructure with finality for the yen and
JGBs. As I summarized on slide 4, banks can complete payments and settlements by resorting
to the central bank's services. "Central bank money," consisting of cash and central bank
deposits, constitutes the most intrinsic foundation and underpinning of the nation's financial
system by providing a settlement chain in collaboration with "commercial bank money."
Let me paraphrase what I mean by this. A central bank issues money and delivers it to end
users, such as households and businesses, through the network of banks' branches and
ATMs. Likewise, non-cash payments are provided to the end users through the nation's
payment and settlement systems in collaboration with banks. It is evident that the central
bank's money and its payment and settlement services furnish the national economy with the
"ultimate finality" of payments and settlements.
Raising the standard of our services will incentivize banks to improve their payment services to
their customers, thereby creating an environment conducive to sustainable growth and a stable
financial system. This leads me to say how important it is for central banks to be involved in the
functioning of the payment and settlement system and to provide settlement finality.
The enhancement of payment services is driven by the need to make the best use of
innovative information technology and related skills. I believe this is well captured in today's
main topic of the round table. Frankly speaking, however, I have an impression that
nonbanking institutions have recently been playing an active role in providing innovative means
of payment. On slide 5, the amount and volume of settlements through non-banking
institutions - which are exemplified by credit cards, electronic money, and debit cards - are
compared with those through banking institutions, which are summarized under the headline
of the Zengin System. The Zengin System is an online network that links banks nationwide
and processes customers' fund transfers in real time all over Japan. The evidence suggests
that payment instruments provided by non-banking institutions have far outpaced the Zengin
System both in terms of amount and volume.
As another example, take the emergence of Bitcoin. It may well be that Bitcoin excels in
facilitating access to the global markets and securing users' anonymity, so that customers
find it more convenient to use Bitcoin for payment rather than settling transactions through
conventional means of payment in the banking system. We central bankers should consider
carefully how we can ensure the proper functioning of the traditional transmission channel of
monetary policy while Bitcoin and other virtual currencies continue to be used in the world.
One possible solution that addresses the Bitcoin issue is enforcement action. New regulation
may curtail its further usage. Nevertheless, payment services provided by banks have a
comparative advantage over those provided by non-banking institutions, because a central
bank can complement banks' services by providing a payment instrument with finality. Such
funding is not readily available to non-banking institutions. Owing to this, improving the
convenience of banks' payment services and encouraging better access to those services
appear to be the most essential ways of responding to a number of challenges triggered by
non-banking institutions' innovative activities.
The network of a central bank and banks constitutes the core of payment infrastructure, but
from the central bank's perspective, we need to make incessant efforts to ensure that those
banks have a firm footing with regard to the provision of payment services, and that they
make efforts to ground their presence in the payment system.
II. Major initiatives in Japan
Next, I would like to explain major initiatives that are underway in Japan in the context of
banking and non-banking activity.
It is understandable that much attention is being paid to the conduct of monetary policy, but a
central bank plays no less a crucial role in building the most important infrastructure for the
economy. That is, to enhance the payment and settlement infrastructure. It is fair to say that
the central bank's payment services provide a pivotal underpinning for the conduct of
monetary policy. Without the smooth settlement of funds among banks and other financial
institutions, we cannot contribute to the stability of Japan's financial system either.
History shows that central banking has been involved in the functioning of payment and
settlement much longer than in the operation of monetary policy. The term "central banking"
comes from the fact that this has long been at the center of the payment and settlement
infrastructure. As the central bank of Japan, the BOJ also runs the payment and settlement
systems in funds transfers and JGBs. Thus, it is our supreme responsibility to ensure that
central bank money, which possesses ultimate finality, as I mentioned, is used in places
where it should be used.
Based on such understanding, I would like to elaborate on four areas in which we have been
making extensive efforts. As summarized on slide 6, these are namely (i) cross-border
collateral arrangements between central banks, (ii) the T+1 project for JGB settlement,
(iii) possible cross-border expansion of the yen and JGBs, and (iv) the improvement in retail
payment services. It is important to recognize that these will contribute to enhancing the
ubiquity of the Japanese yen and JGBs.
The first area aims at enhancing the convenience of banks and businesses through the
central banks' cooperation. All the rest are challenging to the banking industry, but the
reward it eventually will get will be worthwhile. All areas would enable financial transactions
that are not currently available. From the central banks' perspective, the implication derived
from those innovative measures is exciting. Minimizing the unsettled funds and facilitating the
ubiquity of the yen and JGBs will open a new frontier in financial services. With that in mind,
let me now explain the four major initiatives in turn.
A. Cross-border collateral arrangements with central banks in Asia
The first initiative is cross-border collateral arrangements with Asian central banks, with
which the BOJ has been collaborating.
Specifically, with the Bank of Thailand, the BOJ established in 2011 a framework in which
Thai Baht liquidity could be provided by the Bank of Thailand against JGBs and the yen as
collateral. A similar arrangement was established with the Monetary Authority of Singapore in
2014, and agreed upon in principle with Bank Indonesia in 2013.
As shown on slide 7, under such arrangements, the central bank in a host country - in this
case, the Bank of Thailand - provides liquidity in its own currency to banks against JGBs as
collateral. The BOJ plays the role of a custodian to receive JGB collateral from those banks.
All these arrangements allow eligible banks - both Japanese banks and other banks
operating in respective countries - to obtain liquidity in local currencies from central banks to
which JGBs are submitted as eligible collateral. Thus, those banks have additional sources
of local currencies from local central banks under stressed funding conditions. Such
arrangements are beneficial to their customers (e.g., firms), which will be able to maintain
stable borrowings in local currencies from their banks. In sum, financial cooperation with
central banks in Asia will contribute to the stability of financial systems as well as
development of our economies. It also can be regarded as an important cornerstone for the
BOJ to germinate its initiatives to ensure the ubiquity of JGBs.
B. T+1 project for JGB settlement
The BOJ also has been working with market participants to improve the safety of JGB
settlement. For example, we implemented online processing of JGB settlement as early as
1990. We also embarked on various initiatives including a delivery-versus-payment (DVP)
mechanism in which a delivery of securities takes place if, and only if, payment occurs. Lastly,
we have collaborated closely with market participants to introduce a central counterparty (CCP)
for JGB transactions. As for the latter, the Japan Securities Clearing Corporation (JSCC), after a
merger with the Japan Government Bond Clearing Corporation (JGBCC) in October 2013, has
become a CCP for JGB cash transactions, in which it plays the role of a buyer to every seller as
well as the role of a seller to every buyer. Thus, the JSCC provides guarantees for JGB
settlements even in the case of a default by market participants.
In the course of advancing measures to improve the safety and efficiency of JGB
settlements, the collaboration between the BOJ and market participants has been one of the
most important elements.
In this context, another initiative that the BOJ has been working on is to shorten the time lag
between the execution of JGB trading and settlement. At present, the JGB settlement cycle
is T+2 for both standard outright transactions and special collateral repo transactions, and
T+1 for general collateral repo transactions. As you can see on slide 8, we have been
working with market participants to shorten such settlement cycles, from T+2 to T+1 for both
standard outright transactions and special collateral repo transactions, and from T+1 to T+0
for general collateral repo transactions to ensure improvement of the safety in JGB markets.
In fact, the Working Group on Shortening of JGB Settlement Cycle, which was set up under
the auspices of the Japan Securities Dealers Association, identified three overarching
principles for shortening the JGB settlement cycle. The first was to reduce the settlement
risk. The longer the time lag between trading and settlement, the more unsettled positions
accumulate; hence, the settlement risk rises. By containing such a build-up of unsettled
positions, we can effectively mitigate the settlement risk.
The second principle was to enhance the liquidity, safety, and efficiency of the JGB market.
The JGB market - the largest financial market in Japan - provides a benchmark that
facilitates the transactions of other financial assets such as corporate bonds and CP.
Shortening the settlement cycles will make it smoother for banks to raise funds against JGB
collateral. In effect, this will in turn provide investors with a variety of short-term investment
opportunities.
The last principle for the shortening of JGB settlement cycles was to maintain and reinforce
the international acceptance of JGBs. As for the outright transactions, T+1 has already been
achieved in the United States and the United Kingdom. In Asia, Singapore has also moved to
the T+1 platform. In these economies, shortening of the cycles has often been discussed in
the context of maintaining a competitive edge against peers overseas.
Based on these principles, market participants are now aiming to achieve T+1 for JGB
transactions as early as 2017. This is also a part of efforts to achieve the ubiquity of JGBs.
By the end of spring 2015, members of the working group will come up with a more concrete
timetable to achieve T+1, and we are actively providing support on that front. On this point, I am
particularly heartened by the fact that the shortening of settlement cycles is not simply motivated
by the reduction of the settlement risk. Market participants also regard this as a means to
enhance investment opportunities through the internationalization of the yen and JGBs.
As Japan is in the first set of time zones, it is beneficial to tackle a move toward a shorter
settlement cycle. The shorter cycle is an integral part of the initiative to achieve advanced
and market-wide development of straight-through processing (STP). The shorter cycle will
also help galvanize Tokyo's position as a global financial center as it becomes a frontrunner
of financial networks.
C. Possible cross-border expansion of the Yen and JGBs
The third initiative concerns possible cross-border expansion of the yen and JGBs. Under
this initiative, the BOJ will provide a cross-border payment network by anchoring payment
and settlement systems.
1. Extension of the operating hours of the BOJ-NET
Specifically, as shown on slide 9, the BOJ has already announced that it will extend the
operating hours of the BOJ-NET until 9 pm JST from February 2016. This will generate a
longer overlap of the operating hours not only between Japan and Asian countries but also
between Japan and European countries. Consequently, new financial services will become
available, such as overseas remittance services in yen by customers, same-day foreign
exchange transactions - or T+0 transactions - between banks, and the usage of JGBs as
collateral to raise foreign currencies and post as eligible collateral to overseas CCPs to meet
margin requirements.
Beyond extending the operating hours of the new BOJ-NET, additional proposals are
currently being considered. These include measures such as global access and a
crossborder link in Asia to enhance the ubiquity of the yen and JGBs.
2. Global access
Starting with global access, as shown on slide 10, this allows the BOJ-NET participants that
physically have a presence in Japan and hold current accounts at the BOJ to set up their
BOJ-NET terminals in their overseas locations, whereby staff members can operate the
terminals. For example, if a Japanese bank sets up its BOJ-NET terminal in its London base,
it can post JGBs as collateral to a European CCP in London. Alternatively, if a Japanese
bank sets up its BOJ-NET terminal in its Bangkok base, it can carry out same-day remittance
of its customers' funds from Thailand to Japan. Although much needs to be examined
beforehand, the requests from Japanese and foreign banks have been heard and global
access could significantly improve the convenience of the yen and JGBs.
3. Cross-border linkage
The second measure concerns enabling cross-border linkage between the BOJ-NET and
systems overseas. Allowing the BOJ-NET to be connected with its overseas counterparts
can introduce a DVP mechanism for JGB transactions, in which the delivery of JGBs can be
made simultaneously with funds transfers. For example, as shown on the left side of slide 11,
the DVP mechanism for foreign securities' transactions can be used. A Japanese bank
(Bank A) can make yen funding available to a foreign bank (Bank B) that provides foreign
securities as collateral to the Japanese bank overseas. Alternatively, as shown on the right
side of the slide, a Japanese bank (Bank A) can also provide JGBs as collateral to a foreign
bank (Bank B), which can provide foreign currency funds to the Japanese bank overseas at
the same time. By linking the BOJ-NET with those systems overseas, we can facilitate such
DVP transactions, and this will again contribute to enhancing the efficiency and convenience
of the yen and JGBs. In this regard, we are currently continuing discussions with Asian peers
concerning regional settlement infrastructure that promotes cross-border securities
transactions in the region.
4. ASEAN+3 initiatives
The kind of cross-border linkage that I have illustrated will contribute to stable daily funding in
foreign currencies on an ongoing basis. What kind of technological innovation can make this
come true? A possible answer is currently being discussed in the ASEAN+3 countries. They
created a forum in which the establishment of cross-border linkage in the region is currently
being explored. More concretely, the set-up of a cross-border link between the securities
settlement system in one country and the central bank's real-time gross settlement (RTGS)
system in another has been discussed, as shown on slide 11. Such cross-border linkage will
enable market participants to settle foreign-currency funding transactions against domestic
assets as collateral on a DVP basis. If this means of funding, which is known as
crosscurrency repos, becomes available on an ongoing basis, it will contribute to improving the
safety and efficiency of financial transactions in the entire region.
D. Improvement in retail payment services: 24/7 services and financial EDI
The last initiative that I want to mention is the improvement of retail payment services. We
are particularly interested in two issues. First, whether to realize real-time payments between
end users on a 24/7 basis; second, to enhance linkage between remittance information with
payment information to achieve financial Electronic Data Interchange (EDI).
1. 24/7 services
As for the 24/7 services in retail payments, let me step back and explain where we currently
stand in Japan. As you can see on slide 12, the Zengin System, which is at the core of the
Japanese payment system, has long been regarded worldwide as one of the most advanced
systems in the field of retail payment.
It already allows for near real-time payment services during the daylight hours of working
days. More recently, however, some countries, including Singapore in our region, have
developed 24/7 retail services. These offer near real-time payment services 24 hours a day,
7 days a week; hence, they are known as 24/7 services. We also have seen similar services
being offered in countries like the United Kingdom and Sweden. In light of such progress in
overseas economies, it has become a must in Japan to elevate bank transfers to a
comparable level of convenience and efficiency in terms of service availability. This would
ensure smooth operation of retail payment services to underpin business and household
activities.
2. Financial EDI
Slide 13 presents another issue that we are interested in: realizing financial EDI. As you
know, businesses have started to electronically exchange remittance information, such as
purchases and sales orders, by taking advantage of internet technologies. An arrangement
to link such remittance information with payment information - namely, information related to
a beneficiary's bank account and the payment date - and to exchange both remittance
information and payment information together is called financial EDI.
The question is: What is the benefit to businesses in adopting financial EDI? In the short run,
they incur costs associated with developing IT systems that accommodate standardized
formats to exchange data electronically. However, in the medium to long run, they can enjoy
the benefits of raising the efficiency of their operation. For example, firms will be able to
automate the reconciliation of payment information with remittance information; thus, they no
longer need to rely on manually processing accounts receivable.
Looking at the Japanese situation, the Zengin System moved its platform to the
6th generation in November 2011, and one of the new features at that time was to accept the
ISO 20022 XML format as an option for transfer messages. Nevertheless, because the
adoption of this format is not an obligation and it requires coordination among a wide range
of stakeholders, neither banks nor customers have taken advantage of the new format. From
the viewpoint of maintaining competitiveness against their peers overseas, Japanese firms
would need to articulate the means through which to reduce costs by realizing financial EDI
as well.
To be fair, the Japanese Bankers Association has already started looking into the issues of
whether to extend the operating hours of the Zengin System and how to make use of
financial EDI within the Japanese context. It is expected to release the results of its study by
the end of this year. These initiatives show that Japanese banks have started taking
measures to build infrastructure surrounding retail payment systems as a foundation to
underpin their basic payment services.
III. Japan's economy and monetary policy
Thus far, I have focused on the rather technical issues concerning payment and settlement
systems. However, given the continued interest in our monetary policy, and particularly in the
latest action we have taken, I want to spend a few minutes on monetary policy at this point.
In April last year, the BOJ introduced the Quantitative and Qualitative Monetary Easing
Policy, dubbed the QQE, to achieve the price stability target of 2 percent at the earliest
possible time, with a time horizon of about 2 years. The main objectives of the QQE have
been to dispel a view that took root among people over a long period of deflation that prices
would not rise - in other words, a deflationary mindset - and to create a situation in which
households and firms behave on the assumption that prices would moderately increase.
Specifically, in terms of the policy transmission mechanism, we intend to raise inflation
expectations through a strong and clear commitment to achieve the price stability target of
2 percent, and at the same time to exert downward pressure across the entire yield curve
through massive purchases of government bonds. As a result, real interest rates will decline,
thereby stimulating such private demand components as business fixed investment, private
consumption, and housing investment. The upward pressure on prices will grow stronger as
demand increases and the output gap narrows accordingly. Rises in actual inflation rates will
be translated into higher expected rates of inflation and thus lower real interest rates. This
will reinforce the virtuous cycle as the economy is provided with additional stimulus.
Since its inception, the QQE has been producing the intended effects, and Japan's economy
has steadily followed a path towards the achievement of the price stability target of 2 percent.
In fact, the year-on-year rate of change in the consumer price index (CPI) excluding fresh
food, which stood at minus 0.5 percent in March 2013 immediately before introducing the
QQE, subsequently turned positive and moved up to reach above 1 percent by the end of
last year.
In recent months, however, a couple of developments on the price front have attracted our
attention. First, the decline in demand following the consumption tax hike has been
somewhat protracted in durable consumer goods including automobiles, as well as in
housing investment. Second, crude oil prices have declined substantially after the summer.
These factors have contributed to slowing the CPI inflation rates, which had hovered in the
range of 1.0-1.5 percent since the end of the last year, down to 1.0 percent in September.
Of the two factors, the temporary weakness in demand associated with the consumption tax
hike has already started to wane. Meanwhile, the decline in crude oil prices will have positive
effects on economic activity and push up prices over the longer-run. Nevertheless, given the
fact that Japan's economy is currently in a transition process of converting the deflationary
mindset, prolongation of the current downward pressure on prices, albeit temporarily, was
judged to run the risk of delaying the process. To prevent such risk from materializing and to
maintain the improving momentum of expectation formation, we decided to take preemptive
actions to expand the QQE at the Monetary Policy Meeting held on October 31, as shown on
slide 14.
Specifically, we decided to accelerate the pace of buildup in the monetary base by about
10-20 trillion yen to "an annual increase of about 80 trillion yen." In order to carry this out, we
will increase the amount outstanding of the holdings of JGBs by about 30 trillion yen to "an
annual increase of about 80 trillion yen." At the same time, we decided to extend the
average remaining maturity of the JGB purchases by about 3 years at maximum to "about
7-10 years." The purpose of the measures is to leave operational flexibility to buy JGBs from
across the maturity zones and thus effectively compress the entire yield curve in line with
market conditions, whereas the downward pressure on the yield curve has been rather
uneven thus far, with substantial declines in rates on the shorter end while rates on the
longer end remain relatively high. In addition, as for exchange-traded funds (ETFs) and
Japan real estate investment trusts (J-REITs), the increases in the amounts outstanding of
the BOJ's holdings will be tripled in both cases. The latest decision to expand the QQE will
further strengthen the policy transmission mechanism that I mentioned. The decision is also
intended to demonstrate and confirm our strong and unequivocal commitment to achieve the
price stability target.
Conclusion
Let me conclude. The BOJ endeavors to put an end, once and for all, to deflation and bring
the economy back on track towards sustained growth. In the meantime, as I explained to you
today, upgrading the financial and payment infrastructure is also an important part of our
mission. We have been taking a number of steps to bring the Japanese payment and
settlement systems to the forefront. Specifically, the BOJ would encourage the enhancement
of retail payment systems and examine the ways to realize payments and settlements using
the new BOJ-NET for cross-border transactions in yen or JGBs. The initiatives are part of our
priorities for fiscal 2014-18, which show our determination to progress toward the ubiquity of
the yen and JGBs by incorporating the latest technologies. I believe the initiatives will also
promote the internationalization of the yen, which has long been on the policy agenda but
with limited results thus far.
At the same time, I know that our efforts have to extend beyond national borders if we are to
upgrade the financial and payment infrastructure in the entire Asia Pacific region. Hence,
collaboration with market participants and other central banks in the region is essential.
Given the globalized and integrated nature of financial markets of today, only through
collective exercises can we jointly benefit from new ideas and innovation with respect to the
financial and payment infrastructure. The new initiatives would pave the way to further
innovation in the banking sector, enhance the safety and efficiency of financial markets, and
underpin the real economy. It is encouraging in this regard to see that ambitious talks among
the relevant authorities in Asia are already under way. We are committed to playing a key
role because we know too well that without prosperity in the region, there will be no growth
for Japan. Let me end my remarks by reiterating our commitment to contributing to the joint
works with ou