Japanese leader Yasuo Fukuda has spoken of his "worry" over the current credit crunch in an interview with the BBC.

Mr Fukuda said there was a need for governments around the world to take concerted action to improve the current instability in the money markets.

He made his comments after the market had closed in Tokyo, where shares recovered some of their value after significant losses the day before.

He said US problems were depressing the value of shares in Japanese companies.

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"In terms of the real economy, the United States is not doing all that badly," he said.

"In fact, the Japanese economy is also faring pretty well. So it is only the stock markets around the world that are sliding fairly rapidly."

He praised the US authorities for "responding firmly to the situation by cutting taxes and reducing interest rates", saying Japan also needed to take "appropriate measures".

If nervousness among investors proved to be temporary, he said, then he would not be too concerned.

But if it proved to be more long term, it would worry him.

"If the current situation is short-lived then it won't have any major impact," he said.

"But if it is prolonged and the securities markets continue to slip significantly, then the real economy, while it is doing fairly well right now, may sooner or later be affected. I am somewhat worried about that."

He said he was watching the markets closely but he believed that any action to try to calm them had to be taken in concert with the other leading economies around the world.

(BBC)

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