Sunday, February 13, 2011

IMF: Japan's debt and deficit 'are not sustainable'

The comments by IMF deputy managing director Naoyuki Shinohara come weeks after Standard & Poor's lowered the country's credit rating and accused the government of not having a clear plan to ease the debt mountain.

"If you look at Japan's outstanding debts and fiscal deficits, I think they are not sustainable over the medium- and long-term," Shinohara told reporters on the sidelines of a seminar in Tokyo.

"If (Japan) leaves the fiscal situation as it is, it could leave the source of trouble for the future," he said.

"It is important to make a national consensus at the earliest possible time and form a concrete agreement on how to achieve fiscal rehabilitation."

He added, however that "we don't think serious problems will occur imminently," citing Japan's huge pool of savings.

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