Shii calls on government to give strong guidance to banks

Japan Press Weekly

Japan Press Service Co., Ltd. is the only news agency providing information of progressive, democratic movements in Japan

Shii calls on government to give strong guidance to banks

Asked by reporters to comment on the government plan to submit a bill to pave the way for tax money to be used to help regional banks, Japanese Communist Party Chair Shii Kazuo explained the JCP position that puts emphasis on the need to help small- and medium-sized businesses raise funds at a news conference on October 23.

The following are the main points made by Shii:

The government should give guidance to the three major banks to stop exercising reluctance to lend money to small- and medium-sized businesses and stop carrying out forcible debt collections from them. It should also restore the full credit guarantee program for small- and medium-sized businesses.

If there are regional banks that have difficulty keeping their equity capital ratio, the banking industry should help them rebuild financially without relying on tax money.

The government injected more than 40 trillion yen of tax money into banks, including the three major banks, but more than 10 trillion yen was not repaid.

The Bank of Tokyo-Mitsubishi UFJ, Ltd. invested 950 billion yen in Morgan Stanley, the world’s largest financial services firm.

Japan’s major banks are investing abroad while continuing forcible debt collection policy against small- and medium-sized enterprises. They totally neglect their public responsibility.

The use of tax money is not effective in helping banks become financially sound institutions. The task now is to completely change the way of doing business from one of playing casino capitalism that has failed in the U.S. into one of focusing on what banks should do to finance industries.

- Akahata, October 24, 2008