Unit Eight Winds of Change at BOJ(国际经贸高级英语复旦大学)

1、TEXT The Bank of Japan, which traces its history back 116 years, is currently in the midst of a major transformation. With the enforcement of the amended Bank of Japan Law this April, the BOJ will receive legal backing in line with global standards for autonomy and transparency, elements of great im

2、portance for a central bank. With a lineup of new faces on the Policy Board, the Bank is now trying to achieve its paramount goals of price stability and maintaining a secure credit system. This article will examine the newly transformed BOJ. Key Words: Autonomy and Transparency New BOJ Deputy Gover

3、nor Fujiwara Sakuya assumed his post on March 20. “In autonomy,” he stated at a news,Unit Eight Winds of Change at BOJ,conference held that day, “our model is Germanys Bundesbank, and in transparency, it is the United States Federal Reserve Board the Fed.” It would be no overstatement to say that th

4、ese words fairly articulate the ideals sought under the newly amended Bank of Japan Law. The key words of the newly transformed BOJ are thus “autonomy” and “transparency.” The original Bank of Japan Law was enacted in 1942, in the midst of World War II. The law contained a provision which charged th

5、e BOJ with “monetary control as well as maintenance and nurturing of the credit system in accordance with state policy for the purpose of appropriately manifesting national economic power.” The law also contained a provision stating that “the Bank must be operated with the mission of achieving solel

6、y the purposes of the state.”,Unit Eight Winds of Change at BOJ,In short, the law essentially stated the Banks purpose as supporting, in the spheres of monetary and currency policy, a government engaged in prosecuting a war. The law is thus completely unsuited to present-day conditions in Japan. “Au

7、tonomy” refers to the execution of monetary policy independently from politics and the bureaucracy, while “transparency” means the effort to disclose information such that the bank never becomes a power unto itself. These conditions are essential in winning confidence from the market. It hardly bear

8、s mention that the old Bank of Japan Law, enacted as it was more than half a century ago during wartime, was inadequate in achieving these ends. The Banks deficient autonomy in particular was a fatal flaw, with the BOJ being treated as little more than an arm of the Ministry of Finance (MOF) and pol

9、iticians brazenly intervening to manipulate the official discount rate.,Unit Eight Winds of Change at BOJ,For the BOJ, amending the outdated law and revising its content in line with global trends was, according to former BOJ Governor Mieno Yasushi, a “long-cherished desire.” In the face of politica

10、l opposition, this desire was not easily achieved. However, the idea of thoroughly revising the Bank of Japan Law arose in the context of proposed economic reforms by Prime Minister Hashimoto Rytar，who assumed office in January of 1996. Following subsequent deliberation by experts, a draft for the a

11、mended law was completed in February of 1997, passing the Diet in June of that year. The new law entered force on April 1 of this year. Treated vaguely under the old law, the BOJs autonomy was spelled out under the amended law in a provision stating that “the Bank of Japans autonomy regarding curren

12、cy and monetary control shall be respected.” Meanwhile, the powers of the Minister of Finance to give operational directives and relieve bank officials were removed, thereby narrowing the governments room for intervention.,Unit Eight Winds of Change at BOJ,This does not, of course, mean that the BOJ

13、 is free to formulate monetary policy arbitrarily and without heed to the government. The amended Bank of Japan Law, in fact, provides that “.the Bank of Japan shall always maintain close contact with the government and exchange views sufficiently, so that its currency and monetary control and the b

14、asic stance of the governments economic policy shall be mutually harmonious.” There can be no doubt, however, that the bank has greatly enhanced autonomy compared with the past. As one BOJ official put it, “a legal basis now exists for the Bank to formulate policy independently from politics and the

15、 government.” On the other hand, the BOJ cannot, despite its enhanced autonomy, remain insular from prevailing trends. The amended law therefore emphasizes the concept of transparency with a view to preventing such isolation. Concretely, the law provides that “the Bank shall endeavor to clarify to t

16、he public the content of its decisions, as well as its decision making process, regarding currency and monetary control.”,Unit Eight Winds of Change at BOJ,Previously, the BOJ had for the most part not publicly disclosed the process through which it formulated policy, but as described below, the Ban

17、k now discloses the deliberations leading to policy formulation in considerable detail. The call more than 10 years ago for a more open Bank of Japan has at long last been addressed with these amendments in the law. A Visible Policy Board No doubt it is the reform of the Policy Board, the highest de

18、cision-making body of the BOJ, which most clearly represents the concrete embodiment of the ideas incorporated into the amended Bank of Japan Law. This is because not only has autonomy been greatly strengthened over the past, but transparency has been enhanced as well.,Unit Eight Winds of Change at

19、BOJ,Although the Policy Board was designated as the supreme decision making body under the old law as well, important policy matters were in reality said to be formulated by a meeting of BOJ executives, including the deputy governor and the executive directors, with the Policy Board serving as littl

20、e more than a rubber stamp. The Board was thus frequently seen as a “sleeping board.” The amended Bank of Japan Law has greatly strengthened the Boards functioning by expressly placing the Board in charge of formulating interest rate policy. In the course of the Diet deliberations on the proposed am

21、endments to the Bank of Japan Law, the BOJ even explicitly declared that the meeting of executives would be ended. As stated by Koino Shigeru, former member of the Policy Board, “the Policy Board has become the supreme decision making organ in both name and fact.”,Unit Eight Winds of Change at BOJ,A

22、lso, although previously the Policy Board had a total of seven members, including the Governor, two had been representatives from the MOF and the Economic Planning Agency (EPA). Under the amended law, members include the governor and two deputy governors, as well as six other members, for a total of

23、 nine. Meanwhile, the “reserved seats” for the MOF and the EPA have been eliminated. An environment has thus now been created in which the members of the Policy Board can converse with the government without hesitation. The lineup of the Board has also undergone a change. There was a time, from 1996

24、 through 1997, when the entire membership of the Policy Board, including then-Governor Matsushita Yasuo from the MOF, was made up of persons from the central bureaucracy. Following enforcement of the amended law, all four new members of the Policy Board appointed in April of this year are independen

25、t of the government. Other changes in the membership had taken place prior to that time, such that the,Unit Eight Winds of Change at BOJ,diverse, with two members from the Bank of Japan, one from the bureaucracy, two from industry, one from the banking sector, two from academia, and one journalist.

26、Formerly, nearly all members had ranged in age from the late fifties to the seventies. However, Ueda Kazuo, a prominent economist appointed to the Board in April, is a youthful 46. Shinozuka Hideko, an academic specialist on labor issues, has become the first female member of the Board. Nor do the n

27、ew members pull their punches when stating their views. At a press conference on April 1, Nakahara Nobuyuki, a member hailing from the oil industry, rattled financial markets by bluntly stating that, though the official discount rate was already at a historical low of 0.5%, further moves to ease cre

28、dit should be considered if the economy continues to slow. Not a few members have also expressed,Unit Eight Winds of Change at BOJ,criticism and dissatisfaction over the way things have been done at the BOJ in the past. The new style has been welcomed by observers in financial markets as well. Nishi

29、kata Isao, General Manager of the Asset Liability Management Department of the Asahi Bank, credits new members with being “more forthright in their statements and more visible than in the past. ” Hopes are that forthright speech and actions by members of the newly staffed Policy Board will be a heal

30、thy stimulus for BOJ lifers. Another point warranting mention with respect to the Policy Board is the institution of regular Monetary Policy Meetings. Formerly, the BOJ would often alter monetary policy without notice. Questions over when the official discount rate might suddenly be changed therefor

31、e generated increasing unease and unnecessary confusion in financial markets. To avoid this situation, the amended Bank of Japan Law provided for regular meetings of the Policy Board at which,Unit Eight Winds of Change at BOJ,discussions would be held solely with respect to the issue of monetary pol

32、icy. In January of this year and prior to the enforcement of the amended BOJ Law, the BOJ from this beginning created a system for regular Monetary Policy Meetings. With this move, changes in monetary policy would in principle be limited to days on which Monetary Policy Meetings were held, or once o

33、r twice a month. Also initiated was a system to release the minutes of Monetary Policy Meetings after a lapse of five or six weeks. Although such publication has taken place in the United States and the Britain for some time now, disclosing the contents of important meetings in this way after a laps

34、e of only several weeks is virtually unprecedented in Japan, and the move is seen as a groundbreaking step. Since the discussions leading to the formulation of monetary policy will thus become known, BOJ officials argue that the new system “brings Japan into line with global standards for transparen

35、cy.”,Unit Eight Winds of Change at BOJ,The Right Person for the Job The Policy Committee may be seen as symbolizing the newly transformed BOJ, but BOJ lifers are facing major changes as well. The most significant aspect of this change is seen in the abolition of the traditional system of automatic a

36、nnual promotion and the thoroughgoing implementation of a merit-based promotion system. With the personnel shakeup this April, Kuroda Iwao, former Director of the BOJs Institute of Monetary and Economic Studies, was promoted to the post of executive director. The appointment of his replacement, howe

37、ver, raised many eyebrows at the BOJ. Kuroda entered the BOJ in 1996. Thus, according to the customary system, under which younger staffers were automatically promoted on an annual basis, Kuroda would have been followed by a person entering the Bank between 1968 and 1970. Nevertheless, Okina Kunio,

38、who entered the BOJ in 1974, was tipped for the post.,Unit Eight Winds of Change at BOJ,The system of automatic advancement is a characteristic feature of Japanese-style management which stubbornly persists even at private-sector companies facing international competition. This system of advancement

39、 has been even more deeply rooted in the bureaucracy for decades. Observers were therefore all the more surprised to see a decidedly merit-based system implemented at the Bank of Japan, given the Banks quasi-bureaucratic status. As one BOJ official confided, “there was talk at the BOJ over the past

40、several years to the effect that the system of automatic advancement was outdated, and the enforcement of the amended Bank of Japan Law heightened our sense that the time for a change had come. Any system that fails to make efficient use of human resources and remains stymied by the constraints of a

41、nnual advancement will sink.”,Unit Eight Winds of Change at BOJ,Several similar merit-based promotions were subsequently announced. It was soon apparent that Okinas promotion was no isolated case. This meant that, for BOJ employees with talent, ambition, and a distinct field of expertise, the way wa

42、s now open for early advancement to executive posts. This cannot help but invigorate the organization of the BOJ. Dusting off the Banks Reputation The foregoing paragraphs have sketched the positive side of the newly transformed Bank of Japan, with particular focus on the enforcement of the amended

43、Bank of Japan Law. However, any discussion of recent events at the BOJ would have to touch on an unfortunate event which surfaced in the spring of this year.,Unit Eight Winds of Change at BOJ,In March of this year, a 42-year-old section chief of the Credit and Market Management Department (presently

44、 the Financial Markets Department) was arrested by the Tokyo District Prosecutors Office on suspicion of bribe-taking and was dismissed from the BOJ in early April for disciplinary reasons. The event marked the first instance in the 116year history of the Bank in which an employee of executive rank

45、was arrested in a corruption case. It amounted to an unprecedented scandal. The former section chief was charged with releasing confidential BOJ information in exchange for lavish entertainment from private financial institutions, and revelations followed that many other BOJ executives had received

46、similar entertainment, although their acts have not amounted to crimes per se.,Unit Eight Winds of Change at BOJ,Public criticism of the BOJ increased sharply in the wake of the scandal, coming as it did immediately prior to the enforcement of the amended BOJ Law. Despite not having served out their

47、 terms of office, then-BOJ Governor Matsushita Yasuo and Deputy Governor Fukui Toshihiko were forced to resign to take responsibility. The resignation of Deputy Governor Fukui in particular came as a great shock to observers at overseas central banks since Fukui, an ace among the true-blood BOJ rank

48、s, was seen as nearly certain to take over as Governor in late 1999 with the expiration of Matsushitas term. To replace Matsushita, Prime Minister Hashimoto appointed former BOJ executive Hayami Masaru, who had also served as president of a major trading company. To replace Fukui, Hashimoto named Fu

49、jiwara Sakuya, who had been a career journalist. Although Hayami was an old BOJ hand, the appointment of a career journalist to an executive,Unit Eight Winds of Change at BOJ,executive position at a public institution is virtually unseen in Japan. Fujiwaras promotion was thus an exceptional instance

50、 indeed. Underlying the recent scandal was an atmosphere in which lavish entertainment from financial institutions exceeding all social norms had become an almost daily occurrence. In other words, the problem concerned not merely the individual officer who was arrested but the very fabric of the Ban

51、k of Japan as an organization. “There was a need,” says Fujiwara, “to clear the air by bringing in a common mans perspective and getting in touch with normal life again.” Clearly, Fujiwaras appointment aims to rectify the flaws of the old order. The elimination of the,Unit Eight Winds of Change at B

52、OJ,former system of advancement and the meritbased promotion of capable young staffers can also be seen as a link in this rectification. If such reforms continue, the BOJ is sure to become a fully modern institution not merely in its outward legal structure but its inner constitution as well. A cert

53、ain Japanese proverb states in effect that a bad thing can often be turned into a good thing. It means that if used properly, even a tragedy can be made to yield something good. No doubt those within the stately walls of the BOJ are somberly meditating on the import of this saying. (from Look Japan,

54、 September 1998),Unit Eight Winds of Change at BOJ,Unit Eight Winds of Change at BOJ,Exercises . Translate the following into English, using the words or phrases in the text:,1. 日本银行业的改革之风,winds of reform in Japans banking sector,2. 与全球有关自治与透明度要求标准一致的修正后的日本银行法,the amended Bank of Japan Law in line w

55、ith the global standards for autonomy and transparency,3. 谈及货币政策领域的首要目标,touch on the paramount goal in the sphere of monetary policies,Unit Eight Winds of Change at BOJ,4. 使央行承担起保持价格稳定、建立安全可靠的信贷体系的职责,5. 产生不必要的金融市场的恐慌,generate unnecessary panics in the financial markets,6. 独立于行政机关的货币政策的执行,the executi

56、on of monetary policies independent of the bureaucracy,7. 负责制定利率政策的机构,the institutions in charge of formulating the interest-rate policies,charge the central bank with maintaining price stability and nurturing a secure credit system,Unit Eight Winds of Change at BOJ,8. 创历史纪录的0.5%的低贴现率,9. 根据国家政策不断维持和

57、完善信贷体系,to keep maintaining and nurturing the credit system in accordance with the state policy,10. 在财政政策和货币政策的范围内,in the spheres of fiscal and monetary policies,11. 今年开始实施的新经济法,the new economic law entering force this year,a discount rate at a historical low of 0.5%,Unit Eight Winds of Change at BOJ

58、,12. 在推行经济政策的前提下,13. 通过财政政策加强政府职能,to strengthen the governments functions through fiscal policies,14. 赢得市场信心的关键举措,key measures which have won confidence from the market,15. 以功绩为标准的晋升制度的贯彻,the implementation of a merit-based promotion system,in the context of propelling economic policies,Unit Eight W

59、inds of Change at BOJ,. Translate the following sentences into English:,1. 说日本银行的坏账已积累到了一个很高的水平绝对不是言过其实。(overstatement),It is no overstatement to say that the bad accounts in Japans banks have accumulated to a very high level.,2. 央行的半行政机构的状况阻碍了其正常运作，因此，许多经济学家呼吁央行增加其自治程度以合乎全球的标准。(stymie; in accordance with),The central banks quasi-bureaucratic status has stymied its normal operations, so many economists call for the enhancement of its autonomy in accordance with the gl