In human terms, America would be seen as the erstwhile partner who had turned his back on friends in need. While America's interests are clearly at issue, other countries must demonstrate leadership as well. Japan needs to demonstrate its ability to exercise its leadership and stimulate its own economy and open up its market. As the second largest economy in the world, Japan must take the necessary steps to deal with its financial systems, to generate solid growth in domestic demand and further open its markets. It is in Japan's interest, Asia interests and the global economic interests for Japan to take strong action.
China also plays a crucial role in Asia's economic stability and, in fact, the global economy.
I have already referred to the recent assurances by Chinese officials confirming their commitment to exchange rate stability. These have been both significant and welcome. AEA, as it stated before this subcommittee last November, wants to work closely with the Administration and Congress to ensure that we have, as soon as possible, a successful conclusion to these negotiations, assuming a strong protocol that adequately addresses our commercial concerns. Europe, also affected by the Asian crisis, is seeing economic growth and must continue to take necessary steps toward structural reform that will strengthen its recovery. As Europe strengthens its economy, it too can become an engine of global growth.