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Japan to pledge $22 billion trade support, aid to Asia
April 1, 2009 / 5:40 PM / 9 years ago

Japan to pledge $22 billion trade support, aid to Asia

<p>Britain's Prime Minister Gordon Brown greets his Japanese counterpart Taro Aso (R) inside 10 Downing Street in London April 1, 2009. World leaders will have their work cut out at a G20 summit where U.S. President Barack Obama makes his first major international sortie, under perhaps more pressure than anyone to show that the country where the crisis began can lead the way out. REUTERS/Olivier Hoslet/Pool</p>

LONDON (Reuters) - Japanese Prime Minister Taro Aso will pledge fresh support for trade financing and offer up to $20 billion in aid for Asia at a G20 summit on the global economic crisis, an official said on Wednesday.

In a meeting with Indonesian President Susilo Bambang Yudhoyono ahead of the summit, Aso said he would offer a fresh $22 billion in support for trade with developing countries.

British Prime Minister Gordon Brown, host of the G20 meeting of advanced and emerging economies, is calling for a $100 billion expansion of trade finance to bolster global trade flows.

“At this summit, countries should affirm their determination to take every fiscal and monetary measure to revive the world economy and to send a strong message on the issue of avoiding protectionism,” Aso was quoted by a Japanese government official as saying at the bilateral meeting.

“In particular, it is key to restore growth in Asia’s economies,” he was quoted as saying.

World Bank President Robert Zoellick announced a $50 billion program on Tuesday to reverse the steep fall in trade caused by the worst financial crisis in nearly 80 years and urged G20 leaders to follow suit.

The World Trade Organization has warned that global trade will slump 9 percent this year, the biggest drop since the Great Depression.

Japan’s economy has been hard hit by depressed global demand, with its exports halving in the space of a year and hurting its big car and tech manufacturers in particular.

Japan had said ahead of the summit that it would propose a plan to help a government-backed agency provide trade insurance for Japanese exporters doing business with importers in developing countries.

It would also back a state bank making loans for trade with developing countries.

The initiative follows a $1 billion aid scheme Tokyo unveiled in February to boost trade in Asia, which reflected its growing concern of the damage shrinking global trade and liquidity is having on many of its export-reliant Asian neighbors.

Japan would also offer up to 2 trillion yen ($20 billion) in overseas development assistance to Asia to help the region’s economies spur domestic demand, Aso was quoted by the official as saying in his meeting with Yudhoyono.

“We hope that these steps will contribute to growth in Indonesia,” he was quoted as saying.

(Editing by Mike Peacock)

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