ADB praises Japan's overtures to Asia

ADB praises Japan's overtures to Asia

TOKYO (Reuters): A senior official from the Asian Development Bank said "excellent signals" were sent from Japan at Saturday's meeting of finance officials from the Group of Seven (G-7) and Asian nations.

Peter Sullivan, the bank's eastern region vice president, told Reuters that the meeting was successful on a number of fronts, particularly on Japan's commitment to move to improve its economic and financial situation.

"We received excellent signals," he said.

"The pressure was on (Japan) and the commitment was made... We'd like it to happen immediately,"he said.

He said the Asian Development Bank's (ADB) role was basically to explain social sector issues in a number of countries in Asia, particularly in Indonesia and Thailand.

The general tone of the meeting was positive, he added.

"I think it's important that there be unanimity among multinational institutions such as the World Bank, IMF and Asian Development Bank, and bilaterals on the financial and on the social side, and I think that was achieved," he added.

Sullivan said he was particularly pleased by China's commitment to maintain the stability of the yuan, which he termed "tremendous".

But he noted that things remain far from settled in the region in terms of social fallout from this past year's string of economic and currency crises, and that the situation in Indonesia was especially severe.

The devastating influence of "El Nio," which brought severe drought and widespread forest fires to Indonesia, has combined with political instability to create a crisis situation in the country's eastern islands, Sullivan said.

Along these lines, the ADB is currently working out the details of $300 million in project and program loans to target education and health problems in the eastern islands, which they hope will be approved by the end of June.

He said the ADB was also working out the details of a $1.5 billion financial governance loan to cover the banking and financial sectors, which would include technical help and work on developing a long-term bond market.

Sullivan said he hoped this would be approved by the end of the month, but added that it was conditional on agreements being reached between the IMF and Indonesia.

He added that one positive aspect of the crises that have hit Asia one after the other is that organizations like the ADB and IMF, as well as different countries in the region, are now in closer touch than ever.