25 November 2003
Financial Services Agency

EU-Japan High Level Meeting on Financial Issues

EU-Japan High Level Meeting on Financial Issues co-chaired by the European Commission and Ministry of Finance of Japan took place in Brussels on 19 November 2003. Mr. Makoto Hosomi, Deputy Commissioner for International Affairs, and other representatives attended the Meeting from the FSA.

The following is the Press Release announced after the closing of the Meeting.

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Press Release

EU-Japan High Level Meeting on Financial Issues
19 November 2003, Brussels

The annual EU-Japan High Level Meeting on Financial Issues was held in Brussels on 19 November 2003. The meeting was co-chaired by Mr Regling, Director-General of DG Economic and Financial Affairs, Mr Schaub, Director-General of DG Internal Market, for the European Commission, and Mr Mizoguchi, Vice Minister of Finance for International Affairs, for the Japanese side. Mr Hosomi, Deputy Commissioner for International Affairs of the Financial Services Agency, also participated in the meeting, along with officials from both sides.

Against a background of an overall deepening of EU-Japan relations, also within the framework of the EU-Japan Action Plan, a broad exchange of views took place - in a constructive and fruitful atmosphere - on issues related to macroeconomic developments and policies in the EU and in Japan, regulatory and supervisory developments in the financial services' area and international issues of common interest.

Recalling the shared challenges arising from globalisation and the knowledge-driven economy as well as from promoting economic growth and enhancing confidence in financial markets, the parties noted the many similarities in policy approach and reconfirmed their commitment to the EU-Japan High Level Meeting on Financial Issues dialogue.

In the macroeconomic session, the stagnation of growth in the EU in the first half of 2003 was noted, but the EU side stressed that there are signs that a turnaround in economic activity is taking place at the current juncture. The recovery is supported by rising confidence, low interest rates, better financial conditions and an improved international environment. The monetary policy stance and the developments as regards fiscal policies were also discussed.

The Japanese side described the gradually improving economic situation in the first half of the year, which was supported by the strong revival of private capital investment. The Japanese side stressed that the progress in financial and corporate restructuring has positively contributed to the recovery of business confidence. The protracted deflation and the challenges for fiscal policy were also discussed.

Both sides also exchanged views on global issues, including the prospects for the current global economic recovery of gaining momentum and resilience.

The two parties also exchanged information and views on the progress of restructuring in the financial and corporate sectors in Japan as well as on the expected economic, financial and legislative impact of EU enlargement.

During the financial services session, the EU presented the latest developments in the Financial Services Action Plan (FSAP) and noted that progress in adopting the legislative measures to timetable has been maintained despite weak economic conditions. The Council and Parliament should conclude the remaining FSAP measures before April 2004, ahead of the European Parliamentary elections, and implementation of the FSAP by 2005 is thus still on target.

The Japanese side reported on Japan's progress on financial sector reform, including recent developments in the Japanese financial services area.

Both sides exchanged views on international issues of joint interest such as corporate governance, accounting and auditing issues, as well as issues related to the New Basel Capital Accord.

The parties re-confirmed their commitment to the informal dialogue between regulators in the financial services sector within the existing framework.