11 June 2007

Interim Summary of The Study Group on the Internationalization of Japanese Financial and Capital Markets

While competition among markets is intensifying further on a global scale, the presence

of Japan’s financial and capital markets is diminishing in the international arena, the interim report finds.

There are concerns that at the present rate, the markets might not be able to properly fulfill the roles expected of the financial sector. Underlying factors that have been pointed out include the possibility of risk money not necessarily being supplied smoothly to the economy as the shift of funds from savings to investments is still on its way, and concerns in terms of the breadth of human resources and market practices worthy of an international financial center.

In order to build attractive markets that can be used by both domestic and overseas market participants with a sense of security, it is necessary to make comprehensive efforts to not only stimulate the markets and improve their efficiency, but also take steps to ensure transparency and fairness. Specifically, as described in the following pages, a wide range of issues — not only legislative issues but also issues relating to human resources, specialized services and infrastructure — need to be tackled by the government as a whole, and at the same time, by market players in an integrated manner.

Interim report

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