Japan may lend $60 billion to IMF firewall

ROME - Agence France-Presse

A man talking on a mobile phone walks by an electronic stock board of a securities firm in Tokyo. Japan is considering to add $60 billion to IMF’s rescue funding.

Japan is considering lending about $60 billion to the International Monetary Fund to help strengthen a global firewall against contagion from the European sovereign debt crisis, Kyodo news agency said yesterday.

Tokyo is talking with some other key members of the IMF such as China and European nations to finalise their possible contributions to the multilateral lender, ahead of the Group of 20 finance chiefs’ meeting later this week in Washington.

If realised, Japan’s contribution could be one of the biggest by a member nation, Kyodo quoted an unnamed government official as saying.

China is expected to offer a similar amount, leading other emerging economies, some of which are still calling for additional efforts by European leaders to help themselves.

Japan, the second-biggest stakeholder in the IMF after the United States, has shown readiness to lead relevant discussions at the IMF and G-20, as the US government has shown reluctance to be aggressively involved in any fresh IMF resources boost, Kyodo said.

Tokyo has welcomed the recent decision by eurozone finance ministers to temporarily increase their bail-out funds to 700 billion euros ($915 billion) from 500 billion to prevent contagion from the fiscal problems in Greece, Ireland and Portugal spreading to bigger members such as Spain and Italy, the report said.