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Japan says TPP is not a place to negotiate currencies

[TOKYO] Japanese Finance Minister Taro Aso dismissed on Friday a call to set up a forum within the Pacific free trade negotiations to stop countries from manipulating exchange rates.

Mr Aso's comments follow remarks from Australia's trade minister earlier this stating week that countries involved in the Trans-Pacific Partnership (TPP) free trade talks are considering a US proposal for finance ministers to discuss currency questions.

The move falls short of calls by US automakers such as Ford Motor Co and some US lawmakers to include sanctions against currency manipulation in the trade deal.

"We consider that (TPP) is basically not a place to negotiate currencies, which have been fully dealt with the IMF, G7 and G20," Mr Aso told a news conference after a cabinet meeting. "Even if Japan and the United States go further on this, other countries would not support it. We have not heard anything specific but we don't acknowledge that currency policy is being discussed."

A key economic adviser to Prime Minister Shinzo Abe also echoed concerns that the currency debate could hamper efforts of trade liberalisation.

"It's inappropriate to deter benefits of free trade by bringing the exchange market issue to the trade issue, which are essentially unrelated," Koichi Hamada, an emeritus professor of economics at Yale University, was quoted by Jiji newsagency as telling an international conference in Tokyo.

The yen has lost over a third of its value versus the dollar since late 2012, when Mr Abe swept to power pushing aggressive monetary stimulus to reflate the economy.

Weaker exchange rates make a country's exports cheaper and give exporters a competitive advantage.

Economy Minister Akira Amari said currency concerns should not be addressed in the free trade talks as he is attending the 12-nation Trans-Pacific Partnership (TPP) talks being held in Hawaii this week.

REUTERS