Withdraw policy of rescuing banks with tax money and destroying small businesses: JCP

The Japanese Communist Party in parliament demanded that the government withdraw the policy of using 2 trillion yen (17 billion dollars) of tax money to rescue Resona Bank and destroy small businesses, its borrowers.

In the House of Representatives Budget Committee meeting on May 28, JCP representative Sasaki Kensho criticized the Koizumi government for disclaiming all responsibility for the failed economic policy.

Prime Minister Koizumi Jun'ichiro insisted that his policy is in line with reform, and that he will seek the people's judgment in a general election as to whether he should be held responsible.

Sasaki said that under the government policy of speedy write-offs of bad loans held by major banks, banks are driven into denying new loans and forcibly collecting the loans to satisfy the tightened standards on bank assets. Pointing out that small- and medium-sized businesses account for 76 percent of the amount of Resona loans and 99 percent of the number of the loans, he said the government policy will destroy the small business borrowers.

Sasaki further pointed out that if Resona Bank takes in the 2 trillion yen in tax money allegedly for "revival", the bank will have to follow stricter norms than before in regard to borrowers. Takenaka Heizo, economic, fiscal, and financial minister, could not help admitting that small businesses will not be exempt from the loan write-off procedure entitled "revival".

The JCP lawmaker demanded that the government end the policy of writing off bad loans. (end)




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